Fresh sanctions on Iran’s oil sector prior to elections

Fresh sanctions on Iran’s oil sector prior to elections

/ Policy & Regulations / Tuesday, 27 October 2020 08:31

President Donald Trump's administration slapped fresh sanctions on Iran's oil sector including over sales to Syria and Venezuela, reducing Joe Biden's room for maneuver if he wins next week's election.

Under the new measures, the administration designated the National Iranian Oil Company, Iran's petroleum ministry and the National Iranian Tanker Company under a counterterrorism authority, raising the bar for any future administration to reverse course.

The Treasury Department issued the sanctions by linking the three entities to the Revolutionary Guards' elite Qods Force – which was earlier designated as a terrorist organization by the United States and whose commander, Qasem Soleimani, was killed in a US attack at Baghdad airport in January.

Secretary of State Mike Pompeo said that the sanctions should send a warning to "the few remaining buyers of Iranian crude oil."

"These designations are an important step in the maximum pressure campaign to limit the Iranian regime's ability to threaten its neighbors and destabilize the Middle East," Pompeo said in a statement.

Iranian Oil Minister Bijan Zanganeh denounced the sanctions as a "passive reaction to the failure of Washington's policy of reducing (Iran's) crude oil exports to zero."

"I have no assets outside of Iran to be subject to the sanctions. I would sacrifice my life, belongings and reputation for Iran," Zanganeh, who was also targeted personally, wrote on Twitter.

Foreign Minister Mohammad Javad Zarif called the United States a "#SanctionAddict," tweeting, "Kick the habit."  

Inhibiting Biden?

If Trump loses the November 3 election, the sanctions could be among his last volleys against Iran's leaders.

Biden, who leads in polls, favors diplomacy with Iran and backed an accord negotiated by previous president Barack Obama under which Tehran sharply curtailed nuclear work in exchange for promises of sanctions relief.

Henry Rome, a senior analyst at the Eurasia Group risk consultancy, said that Biden if elected could still ease sanctions but would face an added political obstacle by letting critics accuse him of glossing over terrorism.

"The new designations are almost certainly designed to inhibit a potential Joe Biden administration's diplomatic efforts with Iran," Rome said.

Behnam Ben Taleblu, a senior fellow at the Foundation for Defense of Democracies, which presses for a hard line against Tehran, said that any administration would face a "significant" burden in clearing Iran over the oil sales in question.

"It's likely that the impact of these penalties, even this late in the game, could outlive the politics of 2020," he said.

The Treasury Department said that a network backed by the Qods Force shipped more than one dozen tankers of oil in spring 2019 – mostly to Syria, where Iran is a top backer of President Bashar al-Assad as he emerges from a brutal civil war.

Separate from the terrorism designations, the Treasury Department imposed sanctions on a British-based Iranian businessman, Mahmoud Madanipour, and related companies for transactions with Venezuela.

The Treasury Department accused him of arranging the shipment of tens of thousands of metric tons of gasoline to Venezuela, where Trump has been trying unsuccessfully to depose the leftist leader, Nicolas Maduro, who has recently stepped up economic ties with Iran.

Earlier this month, the administration took another major step to cripple the Iranian economy by imposing sanctions on the nation's banks – making most transactions with the outside world difficult.

The measures alarmed European allies of the United States which warn of dire consequences even to humanitarian trade, although the Trump administration insists it is not targeting food or medicine.

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