US won’t be renewing oil waivers: Pompeo
Washington Post columnist Josh Rogin broke the news on Sunday evening, citing State Department officials. Reuters also confirmed the news.
US Secretary of State Mike Pompeo announced the decision on Monday that all eight countries that had been issued waivers, including China and India, will have to end their import of Iranian crude oil in early May or face sanctions, according to the reports.
Maximum pressure on the Iranian regime means maximum pressure. That’s why the U.S. will not issue any exceptions to Iranian oil importers. The global oil market remains well-supplied. We’re confident it will remain stable as jurisdictions transition away from Iranian crude.
— Secretary Pompeo (@SecPompeo) April 22, 2019
“The goal remains simple – the deprive the outlaw regime of the funds it has used to destabilize the Middle East for four decades and incentivize Iran to behave like a normal country,” Pompeo told a press conference in Washington on Monday.
“Our goal has been to get countries to cease importing Iranian oil entirely. Last November we granted exemptions from our sanctions to seven countries and to Taiwan. We did this to give our allies and partners time to wean themselves off Iranian oil and to assure a well-supplied oil market.”
“Today I am announcing that we will no longer grant any exemptions. We are going to zero. Going to zero across the board,” he added.
Pompeo said the US estimates its sanctions have denied the regime more than $10 billion.
“We will continue to enforce sanctions and monitor compliance. Any nation or entity interacting with Iran should do due diligence and err on the side of caution. The risks are simply not going to be worth the benefits,” he added.
Sarah Huckabee Sanders, the White House press secretary, earlier released a statement saying: “President Donald J. Trump has decided not to reissue Significant Reduction Exceptions (SREs) when they expire in early May.”
“This decision is intended to bring Iran’s oil exports to zero, denying the regime its principal source of revenue.
The United States, Saudi Arabia, and the United Arab Emirates, three of the world’s great energy producers, will take measures to assure global oil markets remain adequately supplied, the statement said.
“We have agreed to take timely action to assure that global demand is met as all Iranian oil is removed from the market.”
The decision could have serious consequences for Iran's neighbor Iraq, which depends on Iranian energy to subsidize its ramshackle power grid. Riots broke out in Iraq's southern city of Basra last summer when Iran briefly cut is electricity exports.
Washington granted Baghdad a waiver on sanctions in November, twice extended. It is unclear whether Iraq's special dispensation will also be discontinued.
Earlier, Pompeo held a phone call with Iraq’s Prime Minister Adil Abdul-Mahdi.
“The Secretary underlined his support for Iraq forging closer ties to neighboring Arab states,” according to a State Department readout.
Although Iraq’s non-Arab neighbor Iran was not mentioned in the readout, the statement reflects Washington’s desire to see Iraq source its energy from Saudi Arabia and others rather than Iran.
Responding to the US move, Seyyed Abbas Mousavi, Iran’s newly appointed foreign ministry spokesman, issued a statement saying: “Given the illegal nature of these sanctions, the Islamic Republic of Iran has attached no value...to these sanctions waivers.”
“However, given the negative practical implications of these sanctions and the possibility of increasing the level of these implications with not extending the waivers, the ministry of foreign affairs has today been in constant contact with the relevant internal bodies as well as holding intensive consultation with many foreign partners from Europe and neighbors.”
Decisions would be announced in due course, he added.
Iran’s Oil Ministry said it will continue exports, regardless of what decisions are made in Washington.
“Iran’s oil exports will not become zero under any circumstances,” an unnamed official within the ministry told Tasnim News on April 22. The only way Iran will stop exporting oil is if a decision to do so is made by Iranian officials “under some circumstances… and those circumstances have not risen yet,” the official said.
The ministry has not taken emergency measures in anticipation of the expiration of the waivers because such action is not necessary, the official said. “We have monitored, reviewed and analyzed the possible scenarios facing the oil exports. And for every scenario we have taken appropriate measures in our prewritten plans. It’s not the case that to export its own oil, Iran is waiting for American decision or indecision,” he explained.
Iran has years of experience in offsetting the actions of Americans and others, he added, and will also resist this latest encroachment by the US. “The global oil market needs Iran’s oil and we have numerous and diverse ways to sell our country’s oil,” the ministry official said.
The landmark 2015 nuclear deal gave Iran some relief from decades of sanctions. But after US President Donald Trump withdrew from the agreement last summer, Washington re-imposed sanctions on Iran’s energy, banking, and shipping sectors. US hawks pledged to bring Iranian crude exports to zero under what they called the “toughest ever” sanctions.
Iranian leaders have said they are accustomed to the sanctions they have lived under for 40 years, and Washington’s stance against them will not dent their revolutionary resolve.
Greece, Italy, and Taiwan – three of the countries that were issued waivers – have already complied are now import zero Iranian oil. China, India, Turkey, Japan, and South Korea must now do the same.
The United Arab Emirates (UAE) and Saudi Arabia are expected to offset supplies if the end of the waivers destabilizes the oil market, according to the Washington Post.
Trump’s administration will “try to rely on Saudi Arabia… to reverse policy and increase volumes to calm market fears of oil supplies quickly tightening,” predicted energy analyst Peter Kiernan, Reuters reported.
Tensions between Washington and Tehran have been on the rise after the US State Department designated Iran’s Islamic Revolutionary Guard Corps (IRGC) a terrorist organization earlier this month and Iran reciprocated by slapping the same label on US Central Command (CENTCOM). Iranian Supreme Leader Ali Khamenei appointed a new IRGC chief yesterday.
The IRGC terror designation could have dire consequences for Iraq, whose armed forces have close ties with the Iranian Guards. Washington may, however, be making some exemptions so that countries who have contacts with the IRGC and aid agencies working in Syria, Iraq, and Yemen can avoid sanctions.
“Simply engaging in conversations with IRGC officials generally does not constitute terrorist activity,” a State Department spokesperson told Reuters on condition of anonymity Sunday.
“Our ultimate goal is to get other states and non-state entities to stop doing business [with] the IRGC,” the spokesperson added.
Iraq’s Popular Mobilization Forces (PMF, known locally as Hashd al-Shaabi), have very close ties with the IRGC.
Chargé d’affaires of the US Mission in Iraq Joey Hood, in an interview on Saturday with Iraq’s Dijlah TV, said Baghdad will have to end Iran’s influence on their security forces, saying such dependency weakens Iraq’s sovereignty.
The Shiite PMF militia groups linked to the Revolutionary Guards are also connected to conflicts in Syria and Yemen and Washington will take steps to try to limit this in the coming days, he added in comments that were dubbed into Arabic by the TV station.
It’s time for the Iraqi army to impose its own authority throughout the country, he said.
Updated at 6:19 pm