US reimposes all Iran sanctions lifted in 2015

8 NATIONS GET OIL WAIVER; 700 PEOPLE, ENTITIES ADDED TO BLACKLIST

The Trump administration yesterday announced the reimposition of all US sanctions on Iran that had been lifted under the 2015 nuclear deal.

The sanctions will take effect on Monday and cover Iran’s shipping, financial and energy sectors. With limited exceptions, the sanctions will penalise countries that don’t stop importing Iranian oil and foreign companies that do business with blacklisted entities.

Secretary of State Mike Pompeo said the sanctions “is aimed at depriving the regime of the revenues it uses to spread death and destruction around the world. Maximum pressure means maximum pressure.” He said eight nations, including Italy, India, Japan and South Korea, will receive waivers.

Treasury Secretary Stephen Mnuchin said 700 more Iranian companies and people would be added to the sanctions lists. To punish Iranian banks, Mnuchin said the global financial network SWIFT will also be subject to sanctions if it provides services to Iranian financial institutions

on the blacklist. The US released a list of demands that Iran must meet if it wants the sanctions lifted. They include ending support for terrorism, ending engagement in Syria and completely halting its nuclear and ballistic missile development.

The US has agreed to let eight countries - including Japan, India and South Korea - buy Iranian oil after it reimposes sanctions on the Opec producer on November 5, a senior administration official said.

The American president’s goal is to inflict so much economic pain that Iran abandons its nuclear programme permanently and also quits what his administration calls its “malign activity” in the region and beyond. President Donald Trump has vowed to exploit the US financial system’s global reach to ensure other countries fall into line or risk being barred from the vastly bigger US economy.

But waivers are being granted in exchange for continued import cuts so as not to drive up oil prices, said the official who asked not to be identified. Secretary of State Michael Pompeo was to announce the number of exemptions later yesterday.

China - the leading importer of Iranian oil - is still in discussions with the US on terms, but is among the eight, according to two people familiar with the discussions who also asked not to be identified. The other four countries that will get waivers weren’t identified.

The administration must maintain a delicate balancing act with the waivers: ensuring the oil market has sufficient supply and avoiding a politically damaging spike in fuel prices, while also ensuring that Iran’s government doesn’t collect enough revenue that the US sanctions become irrelevant.

Previously, Pompeo has said, “It is our expectation that the purchases of Iranian crude oil will go to zero from every country or sanctions will be imposed,” but also acknowledged that waivers were being negotiated with nations that say crude from the Middle East producer are critical to their energy industry.

Exemption

Turkey, a key destination for Iranian crude, may be among countries that are getting an exemption, Energy Minister Fatih Donmez told reporters in Ankara.

The waivers are only temporary, and the US will expect countries that get them to keep cutting Iranian imports in the months ahead, according to the US administration official, who declined to give details on the volume of oil the nations will be allowed to buy under the exemptions.

The identity of the countries getting waivers is expected to be released officially on Monday, when US restrictions against oil dealings with Iran go back into effect. The Trump administration has asked that those nations also cut other economic ties with the state, such as by reducing trade in goods that aren’t covered by the sanctions, the official said. –Bloomberg