The US has threatened sanctions on Russia, China and the EU (European Union) if they continue to buy oil from Iran. This was stated by the US Treasury Secretary Steven Mnuchin on Thursday. “Our intention is to enforce sanctions on Iranian Oil against all, including China, Russia and the EU,” Mnuchin said at the Financial Services Committee of the US House of Representatives.
One of the lawmakers commented to the head of the Ministry of Finance that the US is in a state of Trade War with China. “Again: we intend to implement sanctions against them (China), against Russia, and against Europe and others when it comes buying Iranian oil,” said Mnuchin.
The State Department earlier announced Washington’s aim to reduce Iran’s revenues from oil exports to zero. President Donald Trump announced the withdrawal of Washington from the Joint Comprehensive Action Plan (JCPOA Deal), and limit Tehran’s nuclear development.
The Iranian Quandary
Experts maintain that sanctions by the Trump administration will be a major blow to the export of Iranian oil, on which its economy is running. After the entry of the UWP into force, the production of Oil in Iran increased to 4 million barrels per day, and exports – up to 2.5 million barrels per day.
The US policy states that the countries that buy Iranian oil should “considerably” reduce their imports every 180 days. Although the law does not establish what “significant” reduction means, for the previous administration of President Barack Obama this meant 18% of the volume of imports every 180 days. While there is no clarity, what figures will guide the Trump administration.
Currently, China, Japan, South Korea, India and the EU are the key importers of Iranian Oil. In 2016, China, India, South Korea and Japan accounted for nearly 85% of Iranian oil exports. Some of these countries, due to the threat of US sanctions, have already started to reduce the purchases of Iranian oil.