Persian Gulf update 4/22/2019..US set to end waivers on Iran oil sanctions
Iran oil buyers punished, Saudi Arabia wins
Beijing consistently opposes Washington’s unilateral sanctions against Tehran and will take every effort to defend interests of national companies doing legal business with Tehran, the Chinese foreign ministry said after the US said it plans to end waivers for Iran crude sanctions.
“China has always opposed the US imposition of so-called ‘unilateral sanctions’ and ‘long-arm jurisdiction’,” Foreign Ministry Spokesman Geng Shuang told a daily news briefing in Beijing on Monday, adding that Beijing’s mutual cooperation with Tehran is in accordance with the law.
China’s dealing with Iran is “reasonable and legitimate, which thus deserves respect”, he said, noting that “the Chinese government will do its best to protect the legitimate interests of its companies”.
China is a major importer of Iranian oil and was one of eight buyers who were granted a waiver by the United States to continue buying Iranian oil.
It came after an American paper claimed that the United States is to announce that all importers of Iranian oil will have to end their imports shortly or face US sanctions.
The Washington Post reported Sunday, citing two State Department officials, that US Secretary of State Mike Pompeo — the alleged architect of the so-called zero tolerance policy — will make the announcement on Monday.
The administration of President Donald Trump left a multi-lateral nuclear agreement with Iran last May. Afterwards, Washington re-imposed the sanctions that had been lifted under the accord.
Last November, the US enforced sanctions targeting the Islamic Republic’s energy sector, however, it granted waivers from the bans to eight major importers of the Iranian oil, fearing market instability including China, India, Japan, South Korea, Taiwan, Turkey, Italy and Greece.
Now, Washington is expected to declare that the State Department will not be exempting the importers of Iranian crude or condensates beyond May 2, which is the deadline for renewing the waivers.
Officials in Asia opposed the expected move, citing tight market conditions and high fuel prices that are harming industry.
Following the WaPo’s report, Brent crude futures surged more than 3 percent to over $74 per barrel on Monday morning during Asia hours, while US crude futures rose around 2.67 percent to $65.71 per barrel.
The United States wants the Saudis to raise their oil output to prevent prices from spiking.
In early October 2018, Saudi Crown Prince Mohammad bin Salman (MbS) told Bloomberg in an interview that his country had met its promise to the United States to make up for Iranian oil supplies lost through US sanctions re-imposed after Washington’s withdrawal from a 2015 nuclear deal between Tehran and the P5+1 group of countries.
But, Iran’s Oil Minister Bijan Zangeneh dismissed the rhetoric by MbS about Riyadh’s capability to replace sanctions-hit Iranian oil, saying that the global market will never believe such claims.
“It seems that such remarks [by Saudi crown prince] have been made under [US President Donald] Trump’s pressure,” Zangeneh stressed.
Weeks later, the Saudi energy minister declared that his country would not be able to compensate for possible oil disappearance from global markets once the US re-imposes its sanctions against Iran.
Speaking in an interview with Russian news agency TASS, Khalid al-Falih said Saudi Arabia would have to use its oil reserves if it wanted to cover 3 million barrels per day of oil loss from Iran.
However, he added, there is no guarantee that oil prices would not go higher once anti-Iran sanctions come into force in early November.
Iran, the third-largest producer of the Organization of Petroleum Exporting Countries (OPEC), has blamed Trump for oil price hikes, but the US president has pointed the finger at OPEC and called on the oil-producing body to boost output.
A senior Iranian parliamentary said the US jittery calls for ending Iran crude sanctions waivers next month ends in nothing but fiasco as Washington is unable to stand the dire repercussions of any such move even for two months.
“The US is weak and shaky and it is in no condition to sanction us” any further, Abolfazl Hassan Beigi, a senior member of the parliament’s National Security and Foreign Policy Commission, said in Tehran on Monday.
“If the world is not supplied with Iran’s oil for two months, the global economy will be in trouble and undoubtedly, the US wouldn’t be able to make up for the losses,” he added.
His remarks came after Washington Post reported on Sunday that the State Department was set to announce that all countries would have to completely end their imports of Iranian oil or be subject to US sanctions.
Commander of the Islamic Revolution Guards Corps Navy Rear Admiral Alireza Tangsiri warned earlier today that the IRGC would block the Strait of Hormuz if Iran was prevented from using it for trade and oil exports to other states.
“According to international law, the Strait of Hormuz is a marine passageway and if we are barred from using it, we will shut it down. In case of any threat, we will have not even an iota of doubt to protect and defend the Iranian waters. We will defend our prestige and embark on reciprocal acts when it comes to defending Iran’s right,” General Tangsiri said in an interview with the Arabic-language al-Alam news channel.
He said that deployment of foreign military troops in the region stirred insecurity, adding that they were enemies of the regional nations and a threat to the region.
Iranian President Hassan Rouhani had also warned his US counterpart Donald Trump last July against the unbearable costs and dire consequences of blocking Iran’s oil exports, saying belligerency against Iran would the “mother of wars”.
“The regional states are either afraid of the US or do not trust it. Anyone who understands politics a little bit would never say that he/she would prevent exports of Iran’s oil. We have many Straits. The Strait of Hormuz is just one of them,” President Rouhani said, addressing the Iranian ambassadors to foreign states in Tehran, repeating his earlier tacit threat that Tehran would close off the Strait of Hormuz in response to any move by the US to zero its crude supplies.
He stressed that Iran had been the guarantor of security in the Strait of Hormuz all throughout the history, saying, “Mr. Trump! Do not twist the lion’s tail because you will regret. You are not able to provoke the Iranian nation against Iran’s security and interests.”
“The Americans should come to realize this point well that peace with Iran would be the mother of all peaces and war with Iran would be the mother of all wars. We do not quiver from threats and we have a deterrent power. Today our internal unity is more than before, threats make us more coherent and we will definitely beat the US,” Rouhani said, and added, “We would sustain costs, but will earn greater interests.”
President Rouhani underscored that the new conditions created after the US withdrawal from the 2015 nuclear deal was an opportunity for relations with the world, exports and home-made production, saying, “Today, talks with the US has no other meaning but surrendering and putting an end to the Iranian nation’s achievements. If we surrender to a liar bullying person like Trump, they will plunder Iran.”
Addressing a group of Iranians in Switzerland on July 2, President Rouhani had also said that “it would be meaningless that Iran cannot export its oil while others in the region can. Do this if you can and see its consequences”.
He also underlined that Tehran would never give in to pressure forced upon it by foreign countries.
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Lijan al-Hirak al-Shaabi, a popular group protesting against the policies of the Saudi ruling system, in a statement on Monday underlined continued resistance against Riyadh, describing the House of Saud as a sponsor of terrorism.
The statement described the Saudi government as a “sponsor of terrorism”, stressing that the flames of popular moves against the regime will not die.
“The Saudi regime which rules the Arab Peninsula, introduces itself as a supporter of Islam, while it is a sponsor of terrorism and it shelters terrorists by means of misuing global political support in return for economic resources that it has gained from people’s assets and properties,” it added.
The statement referred to the Saudi security forces’ destruction of al-Mansoureh village in Qatif region, the birthplace of Sheikh Nimr al-Nimr, the prominent Shiite cleric executed by Riyadh in 2016, saying that if the Saudi regime wants to annihilate the popular resistance, it will face more resistance.
Qatif, situated in Saudi Arabia’s Eastern Province, has been the scene of anti-regime protests since 2011, with demonstrators demanding free speech, the release of political prisoners,and an end to economic and religious discrimination.
Riyadh has suppressed pro-democracy rallies, but to no avail as protests have intensified since January 2016 when the Al Saud regime executed respected Shiite cleric Sheikh Nimr al-Nimr.
In 2017, Awamiyah, another Shiite-populated Qatif town, witnessed a deadly military crackdown on protests that were being held against the regime’s attempt to raze the historical Musawara neighborhood.
Saudi rulers claimed the district’s narrow streetsserved as a hideout for armed men who were behind the attacks on Saudi forces in Eastern Province.
Riyadh then deployed military forces with heavy weapons to the town, while bulldozers escorted by heavily armored military vehicles demolished several houses, businesses and historical sites across the region.
Dozens of civilians were killed during the weeks-long military crackdown. Some 30,000 people also fled the town.
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