US May Extend Iran Oil Sanctions Waivers

EghtesadOnline: The United States is likely to renew waivers to sanctions for most countries buying Iranian crude, including the biggest buyers China and India, in exchange for pledges to cut combined imports to below 1 million barrels per day.

News ID: ۷۴۶۹۲۲

16 March 2019

"That would be around 250,000 bpd below Iran’s current exports of 1.25 million bpd," two sources familiar with the matter told Reuters.

“The goal right now is to reduce Iranian oil exports to under 1 million barrels per day,” one of the sources said, adding the US President Donald Trump administration was concerned that pressing for a complete shutdown of Iran’s oil in the short-term would trigger a global oil price spike.

Washington may also deny waivers to some countries that have not bought Iranian crude recently, Financial Tribune quoted the sources as saying.

Trump re-imposed sanctions in November after pulling out of a 2015 nuclear accord between Iran and six world powers. Those sanctions have already halved Iranian oil exports.

To give time to importers to find alternatives and prevent a jump in oil prices, the US granted Iran’s main oil buyers waivers to sanctions on the condition they buy less in the future.

The waivers are due for renewal every six months.

“Zeroing out could prove difficult” one of the sources said, adding a price of around $65 a barrel for international benchmark Brent crude was “the high end of Trump’s crude price comfort zone.”

Both sources said they were briefed by the Trump administration on the matter but were not authorized to speak publicly about it and asked for anonymity.

Brian Hook, the State Department’s special representative on Iran, also said in remarks at an industry conference in Houston that Washington is pursuing its plan to bring Iranian crude exports to zero.

Trump “has made it very clear that we need to have a campaign of maximum economic pressure” on Iran, Hook said, “but he also does not want to shock oil markets.”