The US has sanctioned seven companies and two tankers involved in the trade of Iranian petrochemicals and petroleum products, the latest of a steady stream of sanctions that have been issued as the US continues nuclear talks with Tehran.
“The President is committed to driving Iran’s illicit oil and petrochemical exports – including exports to China – to zero under his maximum pressure campaign,” Secretary of State Marco Rubio said in an April 30 statement.
The new sanctions show the US government’s resolve to show that it can target many areas of Iran’s energy trade, said Rachel Ziemba, a senior advisor at political risk consultancy Horizon Engage.
This is not the first time the US has sanctioned the petrochemical industry, Ziemba said. But the sanctions do target a small Turkish buyer, one of the first non-Chinese buyers to be sanctioned, Ziemba said.
“Until now, most of the targeted entities are sellers, not buyers,” she said. “This could make some buyers, including in Turkey or the UAE, more wary, but overall, I still think that the combo of discounts and illicit trade will keep trade flowing after a short-term, potentially modest decline.”
The latest sanctions are in line with the previous string of sanctions, including the recent sanctions on Iran’s LPG trade, said Ellen Wald, president of Transversal Consulting.
“Tightening of sanctions in concert with the ongoing talks is designed to show Iran that the United States is serious about squeezing Iran’s sources of income,” Wald said.
The fact that Iran is still engaged in nuclear talks despite multiple rounds of recent sanctions shows how hard-pressed they are for negotiations to succeed, said Alex Vatanka, a senior fellow at the Middle East Institute.
The risk of the pain of sanctions reaching the people has now reached a level that threatens the survival of the regime, he said. Striking a nuclear deal and getting sanctions relief will help the regime live for another day or another year, he said.
President Donald Trump has more room to impose more sanctions on Iran, but is likely holding back to encourage talks, Vatanka said.
“The sanctions they are introducing are meant to push Iran down the path of negotiations, not choke Iran, if you will,” he said.
New sanctions
The new sanctions target four sellers and one purchaser of Iranian petrochemicals that have generated hundreds of millions of dollars in funds for Iran, the State Department said April 30.
The buyer was a Turkey-based entity that has imported over $15 million worth of shipments containing Iranian-origin petrochemical products from several US-designated Iranian companies, it said in a statement.
The State Department also sanctioned one marine management company, Vroom Marine Venture, and two tankers, the Eloise and the Olia, for transporting petroleum products, the statement said.
Vroom, through the ships it has managed over the years, has transported multiple shipments of petroleum products, including naphtha, the statement said.
The State Department also sanctioned an Iran-based cargo inspection company, which certifies that a purchased cargo is properly loaded onto the vessel, it said.
“By doing so, they reduce the risk these sanctions violators face, thereby playing an important role in the supply chains for illicit Iranian energy products,” the State Department said.
Source: Platts
