Trump Admin Places Sanctions on Iran Oil Minister

By Shaun Tandon

President Donald Trump's administration on Monday slapped fresh sanctions on Iran's oil sector including over sales to Syria and Venezuela, reducing Joe Biden's room for maneuver if he wins next week's election.

The Trump administration has since 2018 enforced sweeping sanctions aimed at ending all of Iran's key oil exports, seeking to choke off all cash sources for the regional nemesis of US allies Saudi Arabia and Israel.

Under the new measures, the administration designated the National Iranian Oil Company, Iran's petroleum ministry and the National Iranian Tanker Company under a counterterrorism authority, raising the bar for any future administration to reverse course.

The Treasury Department issued the sanctions by linking the three entities to the Revolutionary Guards' elite Qods Force, which was earlier designated as a terrorist organization by the United States and whose commander, Qasem Soleimani, was killed in a US attack at Baghdad airport in January.

Secretary of State Mike Pompeo said that the sanctions should send a warning to "the few remaining buyers of Iranian crude oil."

"These designations are an important step in the maximum pressure campaign to limit the Iranian regime's ability to threaten its neighbors and destabilize the Middle East," Pompeo said in a statement.

'Sanction Addict'?

Iranian Oil Minister Bijan Zanganeh denounced the sanctions as a "passive reaction to the failure of Washington's policy of reducing (Iran's) crude oil exports to zero."

"I have no assets outside of Iran to be subject to the sanctions. I would sacrifice my life, belongings and reputation for Iran," Zanganeh, who was also targeted personally, wrote on Twitter.

Foreign Minister Mohammad Javad Zarif called the United States a "#SanctionAddict," tweeting, "Kick the habit."

If Trump loses the November 3 election, the sanctions could be among his last volleys against Iran's leaders.

Biden, who leads in polls ahead of next Tuesday's election, favors diplomacy with Iran and backed an accord negotiated by previous president Barack Obama under which Tehran sharply curtailed nuclear work in exchange for promises of sanctions relief.

Behnam Ben Taleblu, a senior fellow at the Foundation for the Defense of Democracies, a group close to the Trump administration which presses for a hard line against Tehran, said that any administration would face a "significant" burden in clearing Iran over the oil sales in question.

“It's likely that the impact of these penalties, even this late in the game, could outlive the politics of 2020," he said.

The Treasury Department said that a network backed by the Qods Force shipped more than one dozen tankers of oil in spring 2019—mostly to Syria, where Iran is a top backer of President Bashar al-Assad as he emerges from a brutal civil war.

Separate from the terrorism designations, the Treasury Department imposed sanctions on a British-based Iranian businessman, Mahmoud Madanipour, and related companies for transactions with Venezuela.

The Treasury Department accused him of arranging the shipment of tens of thousands of metric tons of gasoline to Venezuela, where Trump has been trying unsuccessfully to depose the leftist leader, Nicolas Maduro, who has recently stepped up economic ties with Iran.

Earlier this month, the administration took another major step to cripple the Iranian economy by imposing sanctions on the nation's banks—making most transactions with the outside world difficult.

The measures alarmed European allies of the United States which warn of dire consequences even to humanitarian trade, although the Trump administration insists it is not targeting food or medicine.

Photo: IRNA

US Sanctions Chinese, UAE Firms Skirting Iran Oil Embargo

The United States on Thursday imposed sanctions against 11 Iranian, Chinese and United Arab Emirates companies accused of helping to bypass the American embargo on Iran's oil exports.

"Iran must stop exploiting its natural resources to fund terror and destruction across the region," US Secretary of State Mike Pompeo warned in a tweet.

It was the latest in a series of sanctions that Washington has slapped on foreign companies doing business with Tehran.

US President Donald Trump in 2018 pulled out of the international agreement signed with the country to prevent it from acquiring nuclear weapons, which he said was ineffective, and immediately re-established and tightened US sanctions against the Islamic Republic.

The US State Department imposed punitive measures on Iran-based Abadan Refining Company, three China-based companies (Zhihang Ship Management CO Ltd., New Far International Logistics LLC, Sino Energy Shipping Ltd) and another based in the UAE (Chemtrans Petrochemicals Trading LLC). Three executives from Abadan, New Far and Sino Energy were also targeted.

Meanwhile, the US Treasury Department has added to its blacklist six firms also based in those countries for doing business with Triliance Petrochemical, a company sanctioned in January for its involvement in the sale of Iranian petrochemical products.

Treasury said those funds are "a key revenue source for the Iranian regime, helping to finance its destabilizing support to corrupt regimes and terrorist groups throughout the Middle East and, more recently, Venezuela."

The newly blacklisted companies are the Iranian firms Zagros Petrochemical Company, UAE-based Petrotech FZE and Trio Energy DMCC, and Chinese companies Jingho Technology Co. Limited, Dynapex Energy Limited and Dinrin Limited, based in Hong Kong.

Photo: State Department

First Iranian Oil Tanker Docks in Venezuela

By Margioni Bermudez

The first of five Iranian tankers carrying much-needed gasoline and oil derivatives docked in Venezuela on Monday, Caracas announced amid concern in Washington.

In a statement delivered on state television, Oil Minister Tareck El Aissami said the convoy was an expression of the Venezuelan people's "self-determination" and praised Tehran's friendship at a time of need. 

"What great fortune to have Iran in these times," said the minister, surrounded by members of the military leadership.

Earlier, El Aissami triumphantly shared images on Twitter of the first ship, "Fortune" arriving at El Palito refinery on Venezuela's northwest coast.

"We keep going and WINNING!" El Aissami wrote.

The United States has closely monitored the shipments, concerned that Iran and Venezuela—both under US sanctions—were taking their longstanding ties to another strategic level.

The Iranian tankers have run the gauntlet of US warships arrayed off the Venezuelan coast after Washington announced last month it was stepping up its naval presence, arguing there was an increase in organized crime. 

Tensions between Washington and Caracas remain high following Venezuela's disruption last month of an abortive military assault by a group of mercenaries coordinated by a private US security company.

The US has stepped up sanctions against socialist President Nicolas Maduro and his inner circle, recently offering a $15 million reward for Maduro accusing him of masterminding a drug-smuggling ring.

Washington and more than 50 other states accuse Maduro of stealing 2018 elections and instead recognize his opposition rival Juan Guaido as interim president.

Vital Shipment

The vital shipment arrives at a time of chronic fuel shortages in the crisis-wracked South American country, exacerbated by the coronavirus lockdown.

In Caracas, where drivers lined up for hours to fill their tanks, Tehran's helping hand was viewed with a mixture of hope and suspicion.

Osvaldo Rodriguez, 22, doubts the fuel "is for us," but instead destined for those with their hands on the levers of power in Venezuela.

"If gasoline is sold at the same price as abroad, nobody will be able to afford it," he said, alluding to Venezuela's minimum wage of $4.60 a month.

Gasoline is currently selling for up to three dollars a liter on the black market in Caracas, unheard of in a country where motorists are used to filling up for practically nothing.

“We have no shortage of oil! Supposedly we are sitting on five billion barrels of it underground. But there's no gasoline," said Teodoro Lamonte, 50, as he slowly rolled his car along a line outside a service station.

Venezuela boasts the largest proven oil reserves in the world, but production has plummeted under the current regime and its oil exports have been hampered by US sanctions.

The Fortune arrived in Venezuela's territorial waters on Saturday night, escorted by the Venezuelan navy.

The navy on Twitter said its ships were escorting a second tanker, the Forest, which it said entered the country's waters early Monday.

The other Iranian tankers—Petunia, Faxon, Clavel and Forest—will arrive in the next few days, state television said.

The fleet is carrying around 1.5 million barrels of gasoline, according to press reports. Tehran had warned of "consequences" if the US stopped the ships from reaching their destination.

Iran and Venezuela have had close relations since the late socialist leader Hugo Chavez took power in Caracas in 1999.

Venezuela has been in recession for six years, its economy in shambles and its citizens struggling with shortages of basic necessities such as food and medicines.

US sanctions have targeted Venezuelan oil exports, starving Caracas of vital income.

Venezuela is almost entirely dependent on its oil revenues but its production has fallen to roughly a quarter of its 2008 level.

Maduro's government blames that on US sanctions, including against state oil company PDVSA, but many analysts say the regime has failed to invest in or maintain infrastructure.

Falling oil prices since 2014 have exacerbated Venezuela's economic crisis.

Last month, the oil ministry revealed that the price of Venezuelan crude had fallen to its lowest level in more than two decades, at less than $10 a barrel. Last year it averaged $56.70.

Photo: SHANA

Iranian Fuel Shipment Reaches Venezuelan Waters

The first of five tankers carrying much-needed Iranian fuel and oil products entered Venezuelan waters on Saturday, a Venezuelan government official said.

"The ships of the sister Islamic Republic of Iran are in our exclusive economic zone," Venezuelan oil minister Tareck El Aissami wrote on Twitter after the arrival of the first tanker, named Fortune.

The fleet is carrying about 1.5 million barrels of gasoline according to media reports, and arrives amid tensions between Tehran and Washington, which has imposed sanctions on Venezuelan oil exports and Iran.

Venezuela had said its navy and air force would escort the tankers after Tehran warned of "consequences" if the US stopped the ships from reaching their destination.

According to shipping tracker MarineTraffic, as of at 9:00 pm local time (0100 GMT Sunday) Fortune was near the coast of Sucre state in northern Venezuela after passing off Trinidad and Tobago.

It plans to sail to the El Palito refinery in Puerto Cabello in northern Carabobo state, according to the state-run television station. 

The rest of the Iranian ships—the Forest, Petunia, Faxon and Clavel—will arrive in the next few days, according to state television.

Relations between Caracas and Tehran have become close since former Venezuelan president Hugo Chavez took power in 1999.

Iran has repeatedly expressed its support for Nicolas Maduro, his successor, who is also supported by Russia, China, Turkey and Cuba.

The United States calls Maduro a "dictator", however, and has leveled a battery of economic sanctions against his administration, including an oil embargo that came into force in April 2019.

The fuel from Iran comes at a time when the shortage of gasoline, chronic for years in some parts of the country, has worsened in the midst of the COVID-19 pandemic. 

Venezuela has the largest oil reserves in the world, but its production is in freefall, a collapse that experts attribute to failed policies, lack of investment and corruption.

Photo: Depositphoto

Iran Warns US Against Disrupting Oil Shipments to Venezuela

Iran's foreign minister on Sunday warned the US against deploying its navy in the Caribbean to disrupt Iranian fuel shipments to Venezuela.

In a letter to United Nations chief Antonio Guterres, Mohammad Javad Zarif warned against "America's movements in deploying its navy to the Caribbean in order to intervene and create disruption in (the) transfer of Iran's fuel to Venezuela."

He said that any such action would be "illegal and a form of piracy," according to a foreign ministry statement. 

Zarif added that the US would be responsible for "the consequences of any illegal measure."

Iran's Fars News claimed Saturday that it had received information that four US Navy warships are in the Caribbean for a "possible confrontation with Iran's tankers."

Elliot Abrams, the State Department's Venezuela envoy, has alleged that Caracas is paying Iran in gold to restore its troubled oil sector.

The US has imposed unilateral sanctions aimed at ending oil exports by both Iran and Venezuela, both major crude producers.

Zarif's deputy has summoned the Swiss ambassador, who represents Washington's interests in Tehran, to communicate Iran's "serious warning".

Abbas Araghchi said any potential threat to Iran's tankers would be met with a "quick and decisive response."

Venezuela has the world's largest proven oil reserves but analysts say that the sector operates below capacity.

The country's economy is in a state of collapse, with millions fleeing as they lack basic goods.

Iran has also taken a hit from renewed US sanctions after US President Donald Trump pulled out of a nuclear accord in 2018.

Maduro has withstood more than a year of US-led efforts to remove him and retains the support of the military.

Iran has repeatedly expressed support for Maduro against opposition leader Juan Guaido, who is recognised by some 60 nations as interim president due to reports of irregularities in Maduro's 2018 re-election.

Photo: IRNA

US Targets UAE-Based Firms for Shipping Iranian Oil

The United States on Thursday slapped sanctions on five companies based in the United Arab Emirates for allegedly shipping oil from Iran in defiance of President Donald Trump's unilateral sanctions.

The Treasury Department said that the five companies bought hundreds of thousands of metric tons' worth of oil last year from Iran's state oil company, declaring it to be from Iraq or otherwise disguising its origin.

The sanctions mark a rare US action against firms in the UAE, a close ally of Washington in its campaign against Tehran but also a major trading hub with a significant Iranian expatriate community.

"The Iranian regime uses revenues from petroleum and petrochemical sales to fund its terrorist proxies, like the IRGC-QF, instead of the health and well-being of the Iranian people," Treasury Secretary Steven Mnuchin said in a statement.

He was referring to the Revolutionary Guards' elite Qods force, whose commander, Qassem Soleimani, was killed in a US drone strike in January at Baghdad's airport.

The sanctions will block any US assets of the five companies and prohibit any transactions with them.

The five companies are Petro Grand FZE, Alphabet International DMCC, Swissol Trade DMCC, Alam Althrwa General Trading LLC and Alwaneo LLC Co.

Trump in 2018 bolted from an internationally backed deal under which Iran scaled back its nuclear program and demanded that all countries stop buying the cleric-ruled nation's oil, its key export.

With the notable exception of China, most countries have reluctantly stopped buying oil from Iran for fear of punishment from the United States.

Trump, who is closely allied with Iran's regional rivals Saudi Arabia and Israel, has vowed to curb Tehran's regional influence.

Photo: Wikicommons

U.S. Lifts Sanctions on Unit of China’s Biggest Shipping Company

By Stephen Cunningham

The U.S. lifted sanctions against a unit of China’s biggest shipping company that was accused of hauling Iranian crude in violation of American restrictions.

According to a notice posted on the Treasury Department’s website Friday in Washington, sanctions were removed. In September, restrictions were placed on the Dalian units of China COSCO Shipping Corp., sending freight rates soaring as traders canceled charters linked to the parent company. Four other Chinese entities were also sanctioned.

Tanker stocks DHT Holdings Inc, Nordic American Tankers Ltd., Frontline Ltd. and Teekay Corp. fell following Friday’s announcement, all dropping by more than 4%.

“With all of the sanctioned tankers back in the open market, overcapacity will weigh even faster and heavier on rates,” said Peter Sand, chief shipping analyst at Bimco. “In combination with demand being low from China, this will be an added burden for the crude oil tanker market.”

Temporary Waivers

The penalties had barred U.S. citizens and companies from dealing with the firms, effectively blocking them from American banks at the heart of the global financial system. However, companies still doing business with the COSCO unit were twice given temporary waivers to wind down their transactions, with the latest one due to run out on Feb. 4.

“The actual impact via the COSCO sanctions was limited as temporary waivers allowed most of the vessels to continue to operate on global trade routes,” said Randy Giveans, vice president for equity research at Jefferies LLC in Houston. “And other vessels just switched to regional, short-haul trades.”

The announcement comes weeks after U.S. President Donald Trump called a truce in his trade war with China and signed what both sides called a “phase one” agreement. In October, people familiar with the matter said China was planning to ask the U.S. to lift the sanctions during trade negotiations in Washington.

Rates to transport oil had soared when the restrictions were placed on the COSCO units, data from the Baltic Exchange in London show. Daily earnings for 2 million-barrel carrying supertankers hit $300,000 a day briefly in October, before quickly retreating as trades become more challenging due to the high cost of moving cargoes. They still remained high by industry standards, though, and exceeded $100,000 as recently as this month.

Even if rates decline further after the return of the sanctioned ships, it won’t necessarily boost U.S. crude exports to China. Beijing’s 5% tax on American crude imports, in effect since September, is an obstacle.

”U.S. crude exports to China would still require the dismantling of Beijing’s U.S. crude tariffs,” said Frode Morkedal, managing director of equity research at Clarksons Platou Securities AS, an investment banking unit of the world’s biggest ship-broker.

Photo: FleetMon

U.S. Extends Clampdown on Iran With Sanctions on Energy Firms

By Serene Cheong and Elizabeth Low

The U.S. sanctioned four companies that it says have traded hundreds of millions of dollars worth of Iranian petroleum and petrochemicals in its latest effort to clamp down on Iran’s revenue sources.

The Treasury Department penalized Triliance Petrochemical Co. Ltd., Sage Energy HK Limited, Peakview Industry Co. Limited, and Beneathco DMCC for dealings with the state-owned National Iranian Oil Co., it said in a Jan. 23 statement. The transactions helped finance Iran’s Islamic Revolutionary Guard Corps-Qods Force and its terrorist proxies, the department said.

The move is a continuation of the White House’s aggressive strategy to penalize firms dealing with Iran, a country it nearly went to war with earlier this month. Last July, It sanctioned Zhuhai Zhenrong Co., a secretive company with links to the Chinese military and a history of taking Iranian crude and fuel. A couple of months after that it threw global shipping markets into disarray after it penalized a unit of COSCO Shipping Corp.

“Iran’s petrochemical and petroleum sectors are a primary source of funding for the regime’s global terrorist activities and enable its persistent use of violence against its own people,” Treasury Secretary Steven Mnuchin said in the statement.

In 2019, Triliance Petrochemical ordered the transfer of the equivalent of millions of dollars to NIOC as payment for Iranian petrochemicals, crude oil, and petroleum products shipped to the U.A.E. and China after the expiration of any applicable exceptions, the Treasury Department said. In facilitating these shipments, Triliance worked to conceal the origin of these products, it added.

Triliance and Sage are based in Hong Kong, while Peakview is headquartered in Shanghai and Beneathco in Dubai. Calls to Triliance’s head office went unanswered, while a person at Beneathco declined to immediately respond to questions. Contact information for Sage and Peakview wasn’t immediately available.

All property and interests in the property of the designated companies are blocked and U.S. persons are generally prohibited from engaging in transactions with them, while foreign financial institutions that knowingly deal with them may be penalized, the department said.

Photo: IRNA

Iran Retains 'Strong Voice' in OPEC ahead of Key Meeting

By Benoit Pellegrin

Iran, hit by year-long US oil sanctions and recent protests over domestic fuel price hikes, retains a "strong voice" in the OPEC producing cartel which meets this week, analysts say.

The Islamic republic suffers from tumbling output yet remains a significant player in the Organization of the Petroleum Exporting Countries (OPEC), whose 14 nations from Africa, the Middle East and Latin America together pump 40 percent of the world's oil.

Washington had re-imposed sanctions last year on Tehran's exports after withdrawing from a 2015 nuclear deal.

"They still have a strong voice," SEB analyst Bjarne Schieldrop told AFP ahead of this week's gathering of both OPEC and its partners that include Russia.

OPEC descends on its plush Vienna headquarters Thursday and Friday and is expected to maintain output cuts alongside its partners—or perhaps even go deeper.

The cuts of 1.2 million barrels per day from October 2018 levels were originally fixed in December last year and were already extended at OPEC's last meeting in July.

Crucially however, Iran was exempt from the deal, which is aimed at shoring up world oil prices and protecting precious revenues.

Yet the republic's output has been shredded by US sanctions that prevent it exporting oil abroad.

According to OPEC data, Iran produced 2.192 million barrels of crude oil per day (mbpd) in the third quarter of 2019.

That contrasted sharply with the 3.813 mbpd of production which the Middle Eastern nation averaged in 2017.

PVM analyst Tamas Varga told AFP that Iran was suffering as a result of "maximum pressure from the United States.”

"Oil export exports are falling," he added.

At the same time, some OPEC nations like Iraq and Kuwait have been able to keep their own output levels unchanged despite the cartel's pact, Schieldrop said.

"The situation is unfair seen from Iran's side," he told AFP.

Meanwhile, Iran's regional rival Iraq has not curbed its output, instead exceeding its own quota despite criticism from OPEC's de-facto leader Saudi Arabia.

In the absence of US sanctions on Iran, oil prices would currently be trading far lower, according to Schieldrop.

"If that was not happening, we would have very low prices today," he noted. Iran—a founding OPEC member which sits on the world's fourth-biggest oil reserves and second-largest gas reserves -- still retains its authority within the cartel.

It has been vocal critic of Russia's increasingly powerful role within the so-called OPEC+ grouping.

But analysts note that Iran now faces social unrest linked to the impact of US sanctions.

Protests broke out across the country from November 15 and were ignited by a price hike on fuel—a heavily subsidized commodity in Iran—as part of an effort to ease pressure on the sanctions-hit economy.

"Iran is suffering economically and socially," Varga said.

Videos emerged this week showing harrowing scenes of bleeding protesters, burning roadblocks and snipers on rooftops after Iran lifted a near-total internet blackout.

The footage has opened a window onto what analysts say was one of Tehran's bloodiest crackdowns.

Many videos from some of the estimated 100 areas where demonstrations erupted appear to show security forces firing at close range at unarmed demonstrators or beating them with batons.

Meanwhile, The US State Department announced that Secretary of State Mike Pompeo would meet Wednesday in Portugal with Israeli Prime Minister Benjamin Netanyahu, who was expected to call for increased US pressure on the "tottering" Iranian government.

Photo: IRNA

Iran Moves on Ultra-Cheap Petrol

Iran imposed petrol rationing and raised pump prices by 50 percent or more on Friday, in a new move to cut costly subsidies that have fueled high consumption and rampant smuggling.

The Islamic republic provides some of the most heavily subsidized petrol in the world, with the pump price previously standing at just 10,000 rials (less than nine US cents) a liter.

Each driver with a fuel card will now have to pay 15,000 rials (13 US cents) per liter for the first 60 liters of petrol bought each month, the state-run National Iranian Oil Products Distribution Company said.

Each additional liter will be charged at 30,000 rials.

Fuel cards were first introduced in 2007 with a view to reforming the subsidies system and curbing large-scale smuggling.

The head of Iran's Planning and Budget Organization, Mohmmad Bagher Nobakht, said the proceeds from the price hike will be used to provide additional subsidies for 60 million people in need.

He said President Hassan Rouhani had insisted that "all extra revenues from the petrol price reform should be paid back to the people.”

"The first payments will be handled within the next week or 10 days," Nobakht told state news agency IRNA.

Ulta-low petrol prices have led to high consumption, with Iran's 80 million population buying an average of 90 million litres per day, according to state news agency IRNA.

They have also fuelled very high levels of smuggling—estimated at around 10 to 20 million litres per day, IRNA said.

Smuggling has intensified as the rial has plummeted against the dollar since Washington unilaterally abandoned a 2015 nuclear deal with Tehran and reimposed crippling sanctions last year.

Inflation is now running at more than 40 percent and the International Monetary Fund projects that the troubled economy will contract by nine percent this year and stagnate in 2020.

Photo:

Iran Says Oil Field Found With 53bn Barrels of Crude

By Amir Havasi

Iran has discovered a massive new oil field, President Hassan Rouhani said Sunday, a find that would boost its proven reserves by about a third in a rare piece of "good news" for an economy battered by US sanctions.

In a speech aired on state TV, Rouhani said the country's economy had stabilised despite punishing US measures against its senior leaders, banking and finance sectors.

The vast field in the southwestern province of Khuzestan holds an estimated 53 billion barrels of crude, he said.

The 80-meter deep reservoir stretches nearly 200 kilometres from Khuzestan's border with Iraq to the city of Omidiyeh.

"This is a small gift by the government to the people of Iran," he said in a speech from the central city of Yazd.

"We announce to America today that we are a rich nation, and despite your enmity and cruel sanctions, Iranian oil industry workers and engineers discovered this great oil field."

The find would add around 34 percent to the OPEC member's current proven reserves, estimated by energy giant BP at 155.6 billion barrels.

Iran, a founding member of the Organization of the Petroleum Exporting Countries, sits on what were already the world's fourth-biggest oil reserves.

The new reserves, if proven, would lift it to third place, just before regional arch-rival Saudi Arabia.

'Unconventional' Sales

But it remains to be seen how much the country can benefit from the new field.

Iran has struggled to sell its oil since US President Donald Trump withdrew from a landmark 2015 nuclear deal last year and reimposed unilateral sanctions.

In May, Washington ended temporary sanctions waivers it had granted to the eight main buyers of Iranian oil, ratcheting up the pressure on holdouts China, India and Turkey to find other suppliers.

Tehran does not report exact figures, but says some crude is still exported via "unconventional" means.

It has hit back at the US with a series of countermeasures, stepping up its nuclear activities and threatening to go further unless the deal's promised economic benefits materialise.

It insists its moves are transparent and easily reversible, calling on the deal's other parties to honor their commitments.

The remaining parties to the 2015 accord—Britain, China, France, Germany and Russia—have been working on measures to help it avoid US sanctions, but with few results so far.

Since the US withdrawal, tensions have cranked up in the Gulf with a series of mysterious attacks on tankers and Saudi oil installations, with Tehran and Washington narrowly avoiding an armed confrontation after the downing of a US drone over Iranian territory.

Economic 'Disruptors'

Iran has experienced a sharp economic downturn this year, fuelled in part by US sanctions, with a plummeting currency sending inflation skyrocketing and hiking the prices of imports.

But Rouhani insisted the economy had now stabilised.

"Our people weathered hard days in the past year ... (but) I believe America is now hopeless," he said.

The IMF has said Iran's economy will contract by a massive 9.5 percent this year, its worst performance since 1984 when the Islamic republic was at war with neighbouring Iraq, but notes the growth is expected to stabilise at zero next year.

Authorities have cracked down hard on "economic disruptors"—Iranians accused of exploiting shortages and fluctuations in gold and currency prices, with dozens tried and some executed.

"I call on the judiciary... to explain billion-dollar corruption cases to the people," Rouhani said during his speech in Yazd.

"Where has the money gone?"

He pointed to a "$2.7 billion case" whose suspect has been "arrested, sentenced to die and is now in prison"—but in which the money is yet to be recovered.

He appeared to be referring to business magnate Babak Morteza Zanjani, on death row after being convicted in 2016 of embezzling $2.7 billion while helping the government circumvent international sanctions.

Photo: IRNA

U.S.-Sanctioned Cosco Unit Gets Two-Month Wind-Down Period

By Stephen Cunningham

Companies still doing business with a U.S.-sanctioned unit of China’s biggest shipping company have less than 60 days to wind down their transactions.

The temporary reprieve comes after last month’s surprise announcement of sanctions against the Dalian units of China COSCO Shipping Corp. caused freight rates to skyrocket as traders canceled charters linked to the parent company.

The U.S. on Thursday issued a license permitting activities deemed necessary to the “maintenance or wind down of transactions” with one of the units, Shipping Tanker (Dalian) Co., until Dec. 20, according to a statement.

Tanker stocks DHT Holdings Inc, Nordic American Tankers Ltd., Frontline Ltd. and Teekay Corp. fell following the announcement.

The Treasury Department sanctioned the Dalian units in September for allegedly hauling Iranian crude. Four other Chinese entities were also sanctioned at the same time. The penalties bar U.S. citizens and companies from dealing with the firms, effectively blocking them from American banks at the heart of the global financial system.

Tanker rates soared after the sanctions as shippers scrambled to find replacement ships, depressing refining margins and affecting normal crude flows around the world.

The sanctions also created uncertainty among among shippers on whether cargoes that had already been loaded onto the vessels of sanctioned firms could be delivered or not.

Photo: Fleetmon

Iran Says China's CNPC Pulls Out of Gas Project

Iran's oil minister said Sunday that China's CNPC has withdrawn from the development of an offshore gas field and that state-owned Petropars will take over the entire project.

The South Pars gas field was to be developed jointly by France's Total, China National Petroleum Corporation and Petropars under a $4.8-billion deal signed in July 2017.

The deal came after Iran reached a 2015 agreement with world powers that gave it relief from sanctions in exchange for limits on its nuclear program, ending years of economic isolation.

Total left the project three months after US President Donald Trump's administration withdrew from the nuclear accord in May last year and reimposed sanctions on Iran's oil industry and other key sectors of the economy.

"Phase 11 (of South Pars) will be entirely developed by Petropars company," Iran's Oil Minister Bijan Namdar Zanganeh was quoted as saying by the ministry's official website.

Asked whether CNPC International had abandoned the project, Zanganeh said:

“Yes, they have.”

The other parties to the Iran nuclear deal—Britain, France, Germany, China and Russia—have vowed to stay in the accord despite the US withdrawal, but their efforts have so far borne no fruit.

Zanganeh said that Petropars did not take the lead on South Pars from the outset because "we wanted to attract foreign investment for this project" and that Petropars was "supposed to learn alongside these (foreign) companies".

He added that the development of a pressure booster platform would depend on talks between Iran's MAPNA Group and other companies.

Petropars signed a $440 million agreement in September with another state-owned firm, Pars Oil and Gas Company, to develop the Balal field in the Persian Gulf.

Photo: IRNA

Iran on Track to Open New Oil Terminal Outside Persian Gulf

Iran said on Monday that it is on track to create a new oil terminal on the Sea of Oman that would open a new export route for its crude and allow tankers to bypass the strategic Strait of Hormuz.

The National Iranian Oil Company signed a contract worth around $52 million Monday with three local companies to supply 50 pumps for the pipeline project, according to the Iranian oil ministry's Shana website.

The pipeline will run from Bushehr province on the Gulf to Bandar-e-Jask on the Sea of Oman, on the other side of the Strait of Hormuz.

"Construction of the Goreh-Jask pipeline and the crude oil export terminal at Jask Port are among the priority plans," Shana reported.

The approximately 1,000-kilometre (620-mile) pipeline will bring oil from Goreh in Bushehr to Jask, making it "strategically important as the country's second-largest crude oil export terminal," Shana reported.

According to Tehran's official IRNA news agency, Jask will export its first crude within 18 months.

In September 2018, Iranian President Hassan Rouhani announced "a major part" of Iran's exports would be shifted to Jask from the Kharg Island terminal -- deep in the Gulf.

He said the project would be completed by the end of his term in summer 2021.

To reach the oil terminal on Kharg Island, tankers must pass the chokepoint Strait of Hormuz—through which most Persian Gulf oil passes—slowing deliveries by several days.

Iran has in the past repeatedly threatened to block the strait—which is used by its Gulf rivals including Saudi Arabia—when faced with sanctions on its oil exports and possible military action by the US.

Washington and Tehran came close to armed conflict in June following a military escalation in the Gulf.

Tension has grown since May 2018 when the United States withdrew from a landmark 2015 nuclear deal with Iran and reimposed sanctions aimed at stopping it from exporting oil.

Washington, Riyadh, Berlin, London and Paris blamed Iran for attacks that damaged the Saudi oil sector on September 14.

Photo: IRNA

Tanker Costs Surge as Chinese Firms Sanctioned Over Iranian Oil

By Alaric Nightingale and Firat Kayakiran

Oil-tanker costs are surging after the U.S. slapped sanctions on Chinese companies it accused of hauling Iranian crude, prompting a scramble in freight markets to secure alternative vessels.

Rates for ships hauling 2 million-barrel cargoes of Middle East oil to Asia jumped 15% or more, according to brokers. Shares of tanker operators also gained.

“There’s a lot of panic out there,” said Halvor Ellefsen, a tanker broker at Fearnleys in London. “Modern vessels are available, but just hard to get.”

The list of sanctioned Chinese companies includes a unit of COSCO Shipping Corp., which operates the world’s second-largest tanker fleet. The penalties bar U.S. citizens and companies from dealing with the sanctioned entities, effectively blocking them from American banks at the heart of the global financial system. As a consequence, oil traders spent the day canceling bookings and letting provisional charters lapse.

Tankers were being booked for about 75 Worldscale points for voyages to Asia, brokers said Thursday. A benchmark published by the Baltic Exchange in London was at 64 on Wednesday. Worldscale is an industry standard that allows traders to easily calculate costs and returns from thousands of different tanker routes. Shares of Frontline Ltd. advanced 8% in Oslo while Euronav NV gained 7.6% in Antwerp.

Rates were already rallying after attacks on Saudi oil installations earlier this month obliged traders to seek alternative cargoes, particularly from suppliers in the U.S. and elsewhere in the Atlantic Basin.

The sanctioned COSCO unit, COSCO Shipping Tanker (Dalian) Co., operates 26 supertankers capable of hauling a combined 52 million barrels of oil, according to data from Clarkson Research Services Ltd. Its parent company is not affected by the sanctions, the U.S. Treasury said.

China opposes the penalties against its companies and citizens and has consistently disagreed with the U.S. imposing unilateral sanctions, Geng Shuang, a foreign ministry spokesman, said at a media briefing.

“Western charterers may avoid all those COSCO VLCCs, but China Inc. is still the largest importer of crude oil, so domestically alone there could be usage of those vessels,” said Jon Chappell, an analyst at Evercore ISI in New York. “Longer term it’s hard to see how it has a sustainable impact unless the ships are banned from global trading.”

Photo: Wikicommons

China Urges 'Restraint' from US, Iran After Saudi Oil Attack

China on Monday urged the United States and Iran to "exercise restraint" after a drone attack on Saudi oil infrastructure, which Washington has blamed on Tehran.

Chinese foreign ministry spokeswoman Hua Chunying also said it was not responsible to accuse others "in the absence of a conclusive investigation or verdict.”

"The Chinese side's position is that we oppose all actions that enlarge or intensify conflict," she told reporters at a regular press briefing in Beijing.

"We hope that both sides can exercise restraint and jointly safeguard the peace and stability of the Middle East," she added.

The drone strikes on Saturday, claimed by Tehran-backed Huthi rebels in Yemen, hit two oil plants in Saudi Arabia and caused a record surge in oil prices, as output from the world's top exporter was slashed in half.

US Secretary of State Mike Pompeo has accused Tehran of launching the attack and said that the US would ensure "Iran is held accountable for its aggression."

On Sunday, President Donald Trump also hinted at a potential American military response to the attack by saying the US was "locked and loaded" to respond.

Iran, however, has dismissed accusations from the US, suggesting that Washington was seeking a pretext to retaliate against the Islamic Republic.

Photo: PRC MFA

Iran Sold Oil Wanted by U.S. But Doesn't Know Where It Is Going

By Arsalan Shahla and Mahmoud Habboush

Iran said it sold an oil cargo on board a contested tanker sailing the Mediterranean Sea but didn’t know where the vessel was going amid U.S. efforts to block delivery of the crude.

The Adrian Darya 1, the tanker that the U.S. sought to seize in Gibraltar last week, was sailing more than halfway into the Mediterranean Sea on Monday without declaring any destination. Iran didn’t identify the buyer of the roughly 2 million-barrel cargo.

The buyer will determine where the oil is delivered, Iranian government spokesman Ali Rabiei said announcing the sale. He didn’t say when Iran sold the crude in comments carried by state-run IRNA news agency.

Iran’s tanker fleet is under intense scrutiny as the U.S. seeks to cut off the Islamic republic’s ability to sell crude, normally the country’s main export earner. Iran’s oil sales have tumbled under U.S. sanctions threatening to punish most interactions with the Iranian government over its nuclear program.

French President Emmanuel Macron renewed efforts over the weekend to save the 2015 nuclear agreement with the Islamic Republic. Both Iran and other signatories to the deal oppose the U.S. President Donald Trump’s tougher measures and Macron proposed allowing the Middle Eastern producer to sell more crude in exchange for returning to full compliance with the agreement. Macron discussed the idea in meetings with Trump and Iranian Foreign Minister Javad Zarif in Biarritz, the site of the Group of Seven summit.

Those discussions would likely do little to solve the immediate problem of the Adrian Darya 1. The Trump Administration is seeking to block the tanker’s voyage by threatening sanctions to stop the ship from being able to call in any port or offload any oil.

The tanker on Sunday changed the signal sent from the vessel’s satellite transponder to “For Order,” a designation meaning the ship isn’t disclosing any destination, according to Bloomberg tanker-tracking data. The Adrian Darya 1, which last week changed names from Grace 1, was sailing south of the Greek mainland, according to tanker-tracking data.

The ship had on Saturday signaled Turkey’s port of Mersin, switching from the previous target of Kalamata in Greece. Greek officials said the ship would be unwelcome after the U.S. threatened sanctions against anyone aiding the tanker, while a stop in Turkey would also pose complications in an already fraught relationship.

The vessel may seek to transfer the crude to smaller ships for delivery to Turkey or Syria and could “go dark,” turning off its satellite transponder to mask the location of any unloading. The vessel’s current trajectory could lead to any of the ports in the eastern Mediterranean or, potentially, to the Suez Canal.

The Aryan Darya 1 wouldn’t be able to transit Suez without offloading some of the oil on board since a fully laden tanker of that size would sit too deep in the water to make the passage. The Suez Canal leads to the Red Sea and from there the vessel could sail on to the Persian Gulf and Iran.

A U.S. attempt to seize the tanker before leaving Gibraltar was denied by a court in Gibraltar. A court in the territory refused the petition from the American government since, while European Union rules prohibit dealing with sanctioned entities in Syria, they are less comprehensive than U.S. sanctions law with regards to Iranian oil sales.

Photo: Bloomberg

U.S. Sanctions Are Forcing Iran to Ditch Push to Cleaner Fuels

By Verity Ratcliffe

Iran is about to burn a lot more fuel oil as a result of U.S. sanctions and new global shipping rules, reversing the nation’s progress in switching to cleaner-burning natural gas.

Power plants and other industrial facilities will burn more than 200,000 barrels a day of highly polluting fuel oil next year, double the amount Iran used in 2018, according to a forecast by Iain Mowat of consultant Wood Mackenzie Ltd.

Iran produces a surplus of fuel oil, and the excess has swelled since the U.S. began restricting the OPEC member’s exports last year. Sanctions also prevent Iran from importing the equipment it would need to refine the heavy oil product into less-polluting products like gasoline and, even if they find a way building refineries takes time.

The situation will only worsen once the International Maritime Organization restricts the use of high-sulfur fuel oil for most vessels starting Jan. 1. Commercial ships and power stations are the two main sources of demand for fuel oil. By curbing the shipping industry’s appetite, the UN agency’s new measure will leave Iran little choice but to burn more fuel oil at home to generate electricity.

Iranians “will have no choice but to dump it at whatever low price they can get for it, cut back on refining or use it themselves,” said Robin Mills, chief executive officer of Dubai-based consultant Qamar Energy. Since anyone buying Iranian fuel oil would run afoul of U.S. sanctions, even rock-bottom prices might not be enough to stimulate sales, he said.

Iran is a prime candidate for flouting the next year’s new IMO rules by using high-sulfur fuel oil in its own fleet, Mills said. International ports, however, have arranged for harsh penalties for violators.

Iran’s government says it wants to build new refineries to process fuel oil into other products. Although refineries typically take four years to complete, Tehran is hoping for faster results, said Sakineh Almasi, a spokeswoman for the parliamentary energy commission, according to the parliament’s Icana news service. Almasi didn’t say how the government plans to work around U.S. sanctions.

Meanwhile, Iran’s storage facilities for oil and fuel are filling up fast. Because the government prefers to reserve precious spare storage capacity for higher-value products such as condensate, it can’t accumulate surplus fuel oil for long, Mills said.

Iran’s use of fuel oil to produce electricity peaked in 2013 and has since fallen sharply as the country’s power plants switched to cleaner-burning natural gas. In the Iranian year ending in March 2018, they consumed about a quarter of the fuel oil they burned four years earlier, according to state-owned Thermal Power Plants Holding Co. A TPPH representative wasn’t immediately available to comment on the outlook for future consumption.

The resurgence in Iranian fuel-oil demand threatens to make the country’s notorious air pollution even worse. Fuel oil contains much more sulfur than natural gas does. Power plants emit these pollutants, blamed for causing acid rain and contributing to human health conditions such as asthma and even lung cancer.

Photo: Tasnim

Iran Denies Giving Gibraltar Assurances for Release of Tanker

By Amir Havasi

Iranian officials on Friday denied that any assurances were given to Gibraltar to release an Iranian tanker now sailing on into the Mediterranean, calling it a "victory" for Tehran.

The ship's seizure, with the help of British Royal Marines, had triggered a sharp deterioration in relations between Tehran and London and what Britain saw as the tit-for-tat detention by Iran of the British-flagged tanker Stena Impero.

Gibraltar's Supreme Court ordered the tanker released on Thursday after the British overseas territory said it had received written assurances from Iran that the Grace 1 would not head to any country subject to European Union sanctions.

The ship had been detained on suspicion that its cargo was destined for the Banias oil refinery in Syria in breach of an EU embargo.

But Iran denied it had provided any assurances to secure the ship's release, saying Gibraltar was only seeking to "save face.”

"Iran has given no assurances over the Grace 1 not going to Syria to secure its release," the state broadcaster's youth website quoted foreign ministry spokesman Abbas Mousavi as saying Friday.

"The tanker's destination was not Syria ... and even if it was, it did not concern anyone else."

Government spokesman Ali Rabiei hailed a victory for Iran that he said had been achieved without making any concessions.

"Our illegally seized oil tanker is set free. This victory without giving any collateral is the result of #powerful_diplomacy and strong will to fight for a nation's rights," Rabiei said in a tweet.

Tanker to Fly Iran Flag

The Grace 1 will be renamed and switch to the Iranian flag for its onward journey into the Mediterranean, senior Iranian shipping official Jalil Eslami said.

"At the owner's request, the Grace 1 will depart for the Mediterranean after being reflagged under the Islamic Republic of Iran's flag and renamed as Adrian Darya for the voyage," Eslami told state television.

The ship was originally Panama-flagged and is carrying two million barrels of Iranian oil, he added.

Hours before the court's ruling, the administration of US President Donald Trump, which has waged a campaign of "maximum pressure" against Iran, launched a last-minute legal move demanding that the Gibraltar authorities extend the vessel's detention.

Iranian Foreign Minister Mohammad Javad Zarif tweeted that the US attempt at "piracy" had failed, saying it showed the Trump administration's "contempt for the law".

Tehran and Washington have been at loggerheads since Trump withdrew from a landmark 2015 nuclear deal between major powers and Iran last year and reimposed crippling unilateral sanctions.

Following the Grace 1's release, Britain renewed its demand that Iran release the British-flagged tanker it seized in the Strait of Hormuz on July 19.

Tehran charged that the Stena Impero was in violation of "international maritime rules" but the move was widely seen as retaliation for the detention of the Grace 1.

The July 4 seizure of the tanker Grace 1 in the British overseas territory of Gibraltar with a cargo of Iranian oil had triggered a sharp deterioration in relations between Tehran and London and the detention by Iran of a British-flagged ship.

Photo: IRNA

Macron, Rouhani Hold Talks Over Iran-US Tensions

French President Emmanuel Macron on Tuesday spoke with his Iranian counterpart Hassan Rouhani and reiterated his call for a de-escalation of tensions between Iran and the United States, the Elysee said.

"It is France´s role to make every effort to ensure that all parties agree to a break and open negotiations," the French presidency said.

The 2015 deal over Iran´s nuclear programme has begun to unravel since US President Donald Trump announced Washington was pulling out of the agreement last year and reimposed sanctions, to the dismay of European allies.

France, Britain and Germany were among the key players in the pact.

Macron had a "long" discussion with Rouhani during the French leader´s annual holiday at his summer retreat, the medieval fort of Bregancon on France´s Mediterranean coast, the Elysee said.

Macron "recalled the need to initiate a de-escalation of tensions," it added.

Paris has engaged in intense diplomacy seeking to solve the current tensions, with Macron´s foreign policy advisor Emmanuel Bonne twice visiting Tehran.

Russian President Vladimir Putin is due to visit Macron in Bregancon in mid-August ahead of a G7 summit in Biarritz which will present "new opportunities to discuss the Iranian issue", according to the Elysee.

Photo: IRNA