LONDON – Iran has bypassed U.S. sanctions and exported more oil to China and other countries in recent months, laying a lifeline for its ailing economy and undermining the Trump administration’s so-called campaign to exert maximum pressure on Tehran.
The extent of Iranian oil sales is difficult to estimate because they often take place in secret. Several companies following the world oil trade claim that shipments from Iran have roughly doubled from the low levels at the beginning of the year, although estimates vary widely.
Iranian crude exports reached 1.2 million barrels a day in the fall, up from 481,000 barrels a day in February, according to estimates by TankerTrackers.com, a U.S. company that uses satellite imagery to track shipments.
Meanwhile, SVB International in Washington reported that Iran was exporting 585,000 barrels of crude oil a day in November, up from 230,000 a year earlier. According to Petro-Logistics, exports rose from 222,000 to 447,000 barrels per day.
More conservative figures suggest that US sanctions have kept most of Iran’s crude oil in the bottle. However, the sharp rise of three market indicators indicates that Tehran has been more successful in selling its oil lately.
Minister
Mike Pompeo.
said last year that the United States was targeting zero oil exports from Iran and had previously tried to bring them below 1 million barrels a day, the provisional penalty level of 2.5 million barrels a day by 2018.
Among Iran’s largest buyers is China, which imported 62,000 barrels of Iranian oil a day in October, according to Beijing’s official trade statistics in June. Industry observers have stated that the actual figures are likely to be much higher and include oil transhipments through other Asian countries.
Socialist leader of Venezuela
Nicolas Maduro,
which has long been at odds with Washington and is under U.S. sanctions – has also started buying Iranian gasoline. And Syria has started importing Iranian oil again this year, according to ship trackers and an Iranian oil officer.
China is one of the largest consumers of Iranian oil.
Photo:
Bloomberg
Iranian shippers are increasingly evading sanctions by deactivating radio transponders to prevent detection, while operators carrying Iranian crude oil change the names of their ships or falsify bills of lading.
More recently, they have started transferring oil to areas previously considered too risky, including the waters off the coasts of US allies Iraq and the United Arab Emirates, according to people familiar with the subject.
US officials acknowledge that Iran is an oil exporter, but argue that the sanctions still have serious economic consequences for the country, including a sharp decline in the number of rials.
The Iranian currency has depreciated by 85% since the beginning of 2018 and Iranian inflation of over 30% has made meat a luxury item. The cuts made by the government last year led to protests resulting in hundreds of deaths.
Secretary of State Mike Pompeo said last year that the United States is striving for zero oil exports from Iran.
Photo:
Reuters
Pompeo said the sanctions have reduced Iran’s oil revenues by $70 billion. United States since May 2018 and that reducing the pressure on Tehran would be a dangerous step. November,
Keith Crack,
The Assistant Secretary of State for Energy described the US sanctions against Iran as remarkably effective.
Iran will be one of the biggest foreign policy challenges for the President-elect.
Joe Biden
when he enters the White House in January, and his transition team says there are likely to be policy changes, including compliance with Iran’s nuclear agreement in 2015. Jake Sullivan, the national security advisor appointed by Biden, said this month that the administration would be willing to implement the agreement – a step that would likely require lifting U.S. sanctions – and use it as a basis for further negotiations on broader issues.
Jake Sullivan, appointed National Security Advisor by President-elect Joe Biden.
Photo:
Mark Makela/Getty Images
Most oil buyers and transporters have stopped doing business with Iran after Washington imposed a total embargo on Iranian crude oil after the Trump government withdrew from the Obama-led nuclear deal with Tehran in 2018.
Iranian traders and some potential buyers have said they expect American pressure to ease as soon as Mr. Trump leaves his office.
The Iranians have to sell oil and we need energy, said a civil servant in Italy, who was once a big buyer of Iranian oil. Tenders will be resumed immediately once the sanctions have been lifted, the official said.
At the same time, emerging Asian economies benefit from the substantial discounts offered by Iranian traders. An advisor to a major Chinese oil company said Iran offered discounts on crude oil of up to $1 a barrel. Traders also sell petroleum products at lower prices.
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Commodity trader
Ali Amirliravi
said Iran offers a discount of $70 per ton of propane, making it 16% cheaper than propane from Saudi Arabia. Buyers from China, India and South Korea were looking for Iranian oil, according to another Iranian trader, who said he was talking about shipments but had not yet made a sale.
Syria resumed imports of Iranian oil in March after trade was interrupted under indirect pressure from the United States. Washington has forced some countries that have allowed Iranian tankers to register under their flag to cancel these registrations. Iran has resumed its sales to Syria and is sending its own fleet of ships under Iranian flag.
This summer, oil-rich Venezuela began buying Iranian gasoline after its refineries almost closed due to American restrictions on Caracas.
In July, the United States intercepted four tankers carrying Iranian fuel on their way to Venezuela, seized the fuel and threatened to arrest the Greek shippers carrying it. In September, Iran sent three of its own tankers, over which the United States has less control, to deliver gasoline to Venezuela, according to Marine Traffic, a ship tracker.
Mail Benoit Faucon at [email protected].
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