Iran allows private players to export oil in move countering sanctions

Iran allows private players to export oil in move countering sanctions
The US is in a hurry to clear Iranian oil shipments from the high seas.
By bne IntelliNews July 2, 2018

Iran is to allow private companies to export crude oil as part of its strategy to counter US sanctions, state media reported on July 1.

At the same time, Tehran is pressing fellow OPEC members, including regional arch-rival Saudi Arabia, not to breach agreed oil production levels.

As part of its attempt to undermine Iran’s economy to the point where the Iranians will be forced to renegotiate the nuclear deal abandoned by Washington in early May, the Trump administration is aggressively demanding that all countries stop importing Iranian oil from November.

“Iranian crude oil will be offered on the bourse and the private sector can export it in a transparent way,” Iranian First Vice President Eshaq Jahangiri told an economic event in Tehran broadcast live on state television, as reported by Reuters.

“We want to defeat America’s efforts... to stop Iran’s oil exports,” he added.

“Oil is already being offered on the bourse, about 60,000 barrels per day, but that has been only for exports of oil products,” Jahangiri said. Iran has an oil and petrochemicals bourse as part of its mercantile exchange.

Turkey, India and China have all said they are not bound by the US demand that they stop importing Iranian oil, but it remains to be seen what policies they will eventually pursue.

Iran warns on OPEC integrity
Separately, Iranian Oil Minister Bijan Zanganeh sent a letter to OPEC asking its members to adhere to the group’s agreement reached last month to collectively raise output and “refrain from any unilateral measures” that could undermine the unity of the producer group.

Referring to reports that Saudi Arabia may increase its oil exports to replace Iranian oil in world markets, Jahangiri said: “Anyone trying to take away Iran’s oil market [share] would be committing great treachery against Iran and will one day pay for it.”

The leader of Saudi Arabia promised US President Donald Trump that he could raise oil production if needed and that his country has 2mn barrels per day of spare capacity, the White House said on June 30. However, as analysts came to the conclusion that if correct that would mean Riyadh was essentially walking out on OPEC, it backed away from that statement, issuing a clarification. That stated that although Saudi King Salman bin Abdulaziz confirmed to Trump his country has the extra production capacity, the Saudis would “prudently” use it “if and when necessary to ensure market balance and stability, and in coordination with its producer partners, to respond to any eventuality.”

Giuliani implies regime change is the goal
Meanwhile, Trump’s close ally Rudy Giuliani on June 30 made remarks that suggest the US president’s decision to re-impose heavy sanctions on Iran is aimed squarely at achieving regime change in Iran. The former New York City mayor addressed a conference of the Paris-based National Council of Resistance of Iran (NCRI), an umbrella bloc of opposition groups in exile. Trump would suffocate Iran’s “dictatorial ayatollahs”, he said.

Giuliani added in an interview with Reuters: “I can’t speak for the president, but it sure sounds like he doesn’t think there is much of a chance of a change in behaviour unless there is a change in people and philosophy. We are the strongest economy in the world... and if we cut you off then you collapse.”

In comments posted to his official website, Iranian Supreme Leader Ayatollah Ali Khamenei said Trump would fail in any attempt to turn the Iranian people against the ruling system. “They bring to bear economic pressure to separate the nation from the system... but six US presidents before him [Trump] tried this and had to give up.”