Baku, Azerbaijan, Nov.8
Trend:
Russia could help Iran evade US sanctions by buying up Iranian oil and reselling it as its own, Head of Economic Research at Italy-based Sogefi Group and expert in energy policy Luis Colasante said in an interview with Azernews.
He was talking about the possible ways of bypassing US sanctions for ensuring Iranian oil supplies to the world market.
Colasante noted that Trump administration is restoring sanctions lifted under the 2015 nuclear deal in a bid to pressure the Islamic Republic.
"These sanctions will hit the Iranian oil sector, banks, and shipping, and will make it difficult to do business with them. The US is betting that economic pressure will force Iran to change its tune and agree to a new, much more restrictive nuclear deal than the one reached in 2015 between Tehran and the six world powers," said the expert.
He pointed out that Iran’s oil exports have fallen since the Trump administration announced at mid-year that they would re-impose sanctions on the Iranian economy.
“But the exemptions granted to Iran's biggest oil customers - China, India, South Korea, Japan, Italy, Greece, Taiwan, and Turkey - allow them to import at least some oil for another six months more. This group of eight buyers imported over 80 percent of Iran's roughly 2.6 million barrels per day of oil exports last year. Only China, India and Japan imported around 1.6 million barrels per day," said the energy expert.
Colasante said the Trump administration fears that Russia could help Tehran evade US sanctions by buying up Iranian oil and reselling it as its own.
He noted that Russia can purchase Iranian oil for domestic usage, thus buying Iranian oil at preference prices and export its internal production.
“But at the end, Russia doesn’t need to import oil from any country. Even in the last five months, Russian production has increased by 400,000 barrels per day and the country has the capacity to increase it by another 300,000 barrels per day," the expert said.
In May, Trump announced that the United States would withdraw from the Iran nuclear agreement and re-impose sanctions against Tehran that had been lifted under the accord.
The first round of the US restrictions entered into force in August, and a second round came into effect on Nov.5.
The sanctions are designed to target Iranian oil exports and the country's financial sector and are aimed at dissuading third countries from doing business with Iran.