Iraq Gets US Sanctions Break to Keep the Lights On

Iraq has won an exemption allowing it to buy Iranian electricity despite US sanctions, as the country plagued by chronic power shortages walks a tightrope between rivals Washington and Tehran.

With US measures imposed Monday taking aim at Iran's banking and energy industries, there were concerns Iraq—which heavily relies on its eastern neighbor for electricity and consumer goods—would be caught in the crossfire.

But Baghdad has managed to secure an exception.

"We granted Iraq a waiver to allow it to continue to pay for its electricity imports from Iran," Brian Hook, the State Department's representative on Iran, announced Wednesday.

Iraq would be expected to show the US how it would wean itself off Iranian gas, a well-informed source told AFP.

"The US gave us 45 days to give them a plan on how we will gradually stop using Iranian gas and oil," the source said.

"We told them it may take us up to four years to either become self-sufficient or find another alternative."

The exemption came after talks between Iraqi and US officials, including from the White House and Treasury, the source said.

Iraqi government representatives have shuffled between American and Iranian officials for months in a bid to insulate their fragile economy from escalating tensions.

This week, Prime Minister Adel Abdel-Mahdi said Baghdad was in talks with both sides to protect its interests.

“Iraq is not a part of the sanctions regime. It talks to everyone, and does not want to get involved in a conflict that it's not a part of," he told reporters Tuesday.

Baghdad has a strong relationship with the United States, coordinating on security, politics, and governance.

But its economy is profoundly intertwined with that of Iran.

Keeping the Lights On

Gutted by the international embargo of the 1990s and the US-led invasion of 2003, Iraq's industries produce little.

Instead, its markets are flooded with Iranian goods—from canned food and yoghurt to carpets and cars.

These non-hydrocarbon imports amounted to some USD 6 billion (five billion euros) in 2017, making Iran the second-largest source of imported goods in Iraq.

Perhaps most consequential for Iraq's 39 million people is their dependency on Iran for electricity.

Chronic cuts, which often leave homes powerless for up to 20 hours a day, were a key driving factor behind weeks of massive protests in Iraq this summer.

To cope with shortages, Baghdad pipes in natural gas from Tehran for its plants and also directly buys 1,300 MW of Iranian-generated electricity.

That reliance is uncomfortable for the US, whose quest to diminish Tehran's influence prompted it to reimpose sanctions on Iranian financial institutions, shipping lines, energy, and petroleum products on Monday.

Eight countries would be temporarily allowed to import Iranian crude oil.

Iraq's special exemption appears to have come with a condition that it lay out how it would stop using Iranian electricity, said Nussaibah Younes, a senior adviser for the European Institute of Peace.

"In order to get this exemption, the Iraqis had given some sort of roadmap idea," Younes told AFP.

One way would be capturing the gas set alight when Iraq extracts oil, which according to the World Bank represents an annual loss of about USD 2.5 billion—enough to fill the gap in Iraq's gas-based power generation.

Appeasing Iran

American firms may help fill the vacuum left by Iran.

In January, Iraq signed a memorandum of understanding with US energy company Orion on gas exploits at a southern oil field.

And in October, Iraq signed a memo with the US's General Electric to revamp the electricity sector, after signing a similar agreement with Germany's Siemens.

The source told AFP that GE was among several US companies proposed to Baghdad during negotiations with the US.

But Iraq has had to simultaneously reassure Iran, in part by granting it an outlet to circumvent US sanctions.

"The focus for the Iranians is informal sanctions-busting activity in Iraq, including accessing hard currency through Iraqi exchanges and through smuggling operations," said Younes.

Baghdad, she expected, would likely "turn a blind eye".

Iraq has simultaneously been granting Iranian officials more time for face-to-face meetings, including its ambassador in Baghdad, Araj Masjadi.

He met with new Finance Minister Fuad Hussein and Electricity Minister Luay al-Khateeb on Wednesday, pledging close cooperation on the power sector in the future.

For Masjadi, the meetings appeared to be a reminder of Tehran's entrenched role in Iraq.

"We need Iraq the way Iraq needs us," said Masjadi.

Photo Credit: MAPNA

US Warns to Stay Away from Iranian Shipping

The United States on Wednesday warned all ports and insurance companies to steer clear of Iranian ships, which it called a "floating liability" after the imposition of sweeping US sanctions.

Since Monday, the United States has aimed to end all of Iran's sales of oil, its crucial export, in a bid to curtail the influence of the Shiite cleric-led state.

Brian Hook, the State Department's special representative on Iran policy, said that the US sanctions extended to insurers and underwriters.

“Knowingly providing these services to sanctioned Iranian shipping companies will result in the imposition of US sanctions," Hook told reporters.

"From the Suez Canal to the Strait of Malacca and all choke points in between, Iranian tankers are now a floating liability," he said.

He said that Iranian vessels would likely turn to domestic insurers but doubted that they could cover losses stretching into the millions or billions of dollars in a major calamity.

"Should there be an accident involving an Iranian tanker, there is simply no way these Iranian insurance companies can cover the loss," Hook said.

He said that the United States, whose military patrols the Gulf and is allied with Iran's rival Saudi Arabia, did not want incidents.

"We sincerely hope there will be no accidents, but accidents are a very real possibility, given Iran's record," Hook said.

President Donald Trump in May pulled out of an international agreement negotiated under his predecessor Barack Obama, in which Iran curtailed its nuclear program in return for sanctions relief.

The Trump administration said that the deal did not address other concerns, including Tehran's support for regional proxies such as Hezbollah, and has boasted of the economic contraction forecast in Iran due to the renewed sanctions.

The United States has nonetheless granted eight waivers to places including China, India and Japan, which will not immediately be punished for continuing to buy Iranian oil.

Photo Credit: IRISL

Trio Arrested in Denmark for Praising Iran Parade Attack

Three members of an Iranian separatist group that Tehran blames for a deadly attack in Iran and who were targeted by a foiled assassination plot in Denmark have been arrested, Danish police said Wednesday.

"Three people have been arrested suspected of violating the Danish law... on condoning terrorism," a police statement said.

The three members of the Arab Struggle Movement for the Liberation of Ahvaz (ASMLA) are accused of praising the five commandos who attacked a military parade in the Iranian city of Ahvaz on September 22, spraying the crowd with gunfire and killing 24 people.

Iran has blamed the attack on the ASMLA, which advocates for an Arab state in a southwestern Iranian province. Tehran calls it a terrorist organisation.

The Danish intelligence service PET on October 30 said it had prevented an assassination attempt by Tehran against three exiled Iranians living in Denmark, including the exiled leader of ASMLA.

PET has provided protection for the ASMLA leader since early 2018 "as a result of tangible threats which, in the assessment of PET, emanate from Iran".

"Despite the fact that they are suspected of having committed crimes, they continue to be protected by extensive security measures because of the threat posed to them," Danish police said in a statement Wednesday.

A Norwegian of Iranian origin was arrested on October 21 and placed in custody, suspected of planning the assassination and spying for Iran.

Denmark recalled its ambassador to Iran over the foiled attack, and said it was consulting with its allies about possible sanctions against Tehran. 

Iran has denied the Danish allegations, calling them "a continuation of conspiracies by the enemies of good and developing relations between Iran and Europe."

Photo Credit: Wikicommons

US Exempts Indian-Backed Port in Iran from Sanctions

The United States said Tuesday it would exempt Iran's Indian-backed port of Chabahar from new sanctions on Tehran, recognizing the value of the project to Afghanistan.

Iran late last year inaugurated the port on the Indian Ocean which provides a key supply route to landlocked Afghanistan and allows India to bypass its historic enemy Pakistan.

The United States will exempt from sanctions the development of Chabahar along with an attached railway project and Iranian petroleum shipments into Afghanistan, the State Department said.

President Donald Trump's "South Asia strategy underscores our ongoing support of Afghanistan's economic growth and development as well as our close partnership with India," a State Department spokesperson said.

"This exception relates to reconstruction assistance and economic development for Afghanistan. These activities are vital for the ongoing support of Afghanistan's growth and humanitarian relief," the spokesperson said.

The United States, which has been building closer relations with New Delhi since the late 1990s, earlier exempted India from sanctions that took effect on Monday.

The Trump administration has vowed to exert maximum pressure on Iran to end its support for regional proxies, exiting a denuclearization agreement that brought sanctions relief.

Trump's decision has been opposed by European powers as well as other nations including India, which has largely warm relations with Iran and accuses Pakistan of fomenting attacks on its soil.

India has poured USD 2 billion into Afghanistan since the 2001 US-led overthrow of the extremist Taliban regime, which was also opposed by Iran.

India has seen Chabahar as a key way both to send supplies to Afghanistan and to step up trade with Central Asia as well as Africa.

Iran has plans to link the port by railway to Zahedan on the Pakistani border up to Mashhad in the northeast.

Photo Credit: IRNA

Russia, Spain Slam US 'Ultimatums' on Iran

The foreign ministers of Spain and Russia on Tuesday hit out at US sanctions policy against Iran and ultimatums they say are being imposed by Donald Trump's administration.

President Trump in May abandoned a 2015 multi-nation deal with Iran aimed at reining in its nuclear program.

The deal had been unanimously endorsed by a United Nations Security Council resolution, making it legally binding.

On Monday, Washington reimposed its last tranche of sanctions—punitive measures targeting the Iranian oil and financial sectors.

The Trump administration nevertheless gave eight countries temporary waivers, allowing them to continue to buy oil from Iran—China, India, Turkey, Japan, South Korea, Taiwan, Italy and Greece.

But in general the US sanctions stipulate that to maintain access to the US market, countries and foreign companies must stop trading with Iran.

“Sanctions are absolutely illegitimate, they are are being imposed in flagrant violation of the UN Security Council's decision," Russian Foreign Minister Sergei Lavrov told reporters in Madrid.

"And the forms in which these measures are being declared and implemented cannot cause anything but deep disappointment.

"It is not acceptable in our age to pursue a policy based on ultimatums and unilateral demands."

Spanish Foreign Minister Josep Borrell concurred, saying he rejected "any kind of position that resembles an ultimatum from anyone and also from the United States.

"This notion of 'you're either with me or against me' is of another era."

Photo Credit: Wikicommons

Turkey Warns US its Iran Sanctions Are 'Dangerous'

Turkey has warned Washington against its new sanctions on Iran, saying isolating the Islamic Republic is "dangerous.” Turkish Foreign Minister Mevlut Cavusoglu said Tuesday.

Washington this week imposed a second set of sanctions on Iran that aim to isolate the country's banking sector and slash its oil exports.

Eight countries including Turkey have received a US waiver to continue importing Iranian oil.

"While we were asking (for) an exemption from the United States, we have also been very frank with them that cornering Iran is not wise. Isolating Iran is dangerous and punishing the Iranian people is not fair," he said at a press conference during a trip to Japan.

“Turkey is against sanctions, we don't believe any results can be achieved through the sanctions," he added.

"I think instead of sanctions, meaningful dialogue and engagement is much more useful."

Washington has imposed two sets of sanctions this year after pulling out of a nuclear pact agreed between world powers and Iran that President Donald Trump slammed as "defective".

The latest round went into effect on Monday. 

Washington has granted eight countries, including Turkey and Japan, waivers to allow them to continue importing Iranian oil without facing diplomatic consequences.

The new sanctions have sparked furious reactions from Iran, whose President Hassan Rouhani said the country would "proudly bypass your illegal, unjust sanctions.”

On Monday, Washington vowed to be "relentless" in countering Iran, with Secretary of State Mike Pompeo saying the US wanted Iran to make a "180-degree turn" and abandon its "current revolutionary course.”

UN inspectors say Iran is abiding by an agreement reached with Trump's predecessor Barack Obama to draw down its nuclear program. That deal was backed by European powers, Russia and China and sealed by a UN Security Council resolution.

Those other parties to the nuclear deal have vehemently opposed the US move and vowed to keep alive the accord, technically known as the Joint Comprehensive Plan of Action.

Photo Credit: Wikicommons

US Issues Waivers to Allow Iran Deal to Continue

The United States said Monday it was issuing waivers to allow the continuation of a nuclear deal with Iran, after declaring the agreement a disaster and slapping sweeping sanctions.

Hours after sanctions went into effect that ban most trade with Iran, the State Department said it was exempting projects set up through the 2015 nuclear deal negotiated under former president Barack Obama.

The international activities at Bushehr, Iran's only nuclear power station, as well as the Fordow enrichment plant and the Arak heavy water reactor will be allowed "to continue under the strictest scrutiny to ensure transparency and maintain constraints on Iran," the State Department said in a statement.

"This oversight enhances our ability to constrain Iran's program and keep pressure on the regime while we pursue a new, stronger deal," it said.

The State Department said the waivers were "temporary," without specifying a timeframe, and "conditional on the cooperation of the various stakeholders."

The 2015 agreement promised that world powers would assist Iran in developing civilian nuclear energy—the clerical regime's stated goal for its atomic program.

Russia has supplied fuel for the Bushehr reactor. The Arak site, which could eventually be used to produce plutonium, is being redesigned under the deal to ensure it does not, with spent fuel to be shipped out.

Russia is also working with Iran on isotope production at Fordow to ensure that the site works toward medical purposes rather than uranium enrichment.

The other parties to the deal—Britain, China, France, Germany and Russia along with the European Union—say that the accord remains in force and is working, noting that UN inspectors report that Iran has complied.

President Donald Trump has called the agreement a "disaster" and, as of Monday, the United States will sanction countries and companies that do business with Iran or buy its oil.

Secretary of State Mike Pompeo said Monday the United States wants Iran to undertake a "180-degree" change that includes cutting off support for regional proxies such as Hezbollah and ending missile tests.

Photo Credit: Wikicommons

US to Exempt China, India, Japan from Iran Oil Sanctions: Pompeo

The United States will exempt China, India and Japan from oil sanctions on Iran, Secretary of State Mike Pompeo said Monday, while vowing to be "relentless" in pressuring Tehran.

Hours after sweeping sanctions were reimposed following the US withdrawal from a denuclearization deal, Pompeo said eight countries would be at least temporarily exempt from the ban on buying Iranian oil due to special circumstances or so as not to disrupt energy markets.

The countries with the waivers will be China, India, Italy, Greece, Japan, South Korea, Taiwan and Turkey, Pompeo said.

“Our objective is to starve the Iranian regime of the funds it uses to fund violent activity throughout the Middle East and around the world. Our ultimate goal is to encourage them to abandon their revolutionary course," Pompeo told reporters.

A notable omission was Iraq. Had Iraq been granted a waiver, Iran might have been able to skirt sanctions by mixing its crude with its neighbor's output, analysts say.

President Donald Trump withdrew in May from the deal that his predecessor Barack Obama had reached with Iran, calling it a failure because it addressed only the clerical regime's nuclear program.

Pompeo reiterated demands for Iran to make a "180-degree turn" from its regional policies rooted in the 1979 Islamic revolution, such as support for the Lebanese militia Hezbollah.

“We hope a new agreement with Iran is possible, but until Iran makes changes in the 12 ways I listed in May, we will be relentless in exerting pressure on the regime," Pompeo said.

Pompeo said the eight countries exempted have "already demonstrated reduction of Iranian crude over the past six months and, indeed, two of those eight have already completely ended imports of Iranian crude and will not resume as long as the sanctions remain in place."

"We continue negotiations to get all of the nations to zero," he said.

Pompeo also said without specifying that the United States would exempt three non-proliferation projects underway in Iran from the sanctions.

European powers have strongly disagreed with Trump's decision, pointing out that Iran is abiding by the nuclear agreement, and have looked to create ways to allow its businesses to keep up commerce with the country.

Photo Credit: Deposit Photos

US Sanctions: SWIFT Network Suspends Several Iran Banks

The SWIFT banking network, the backbone for international monetary transfers, said Monday it has suspended several Iranian banks from its service, after the United States reimposed nuclear sanctions on Tehran.

"In keeping with our mission of supporting the resilience and integrity of the global financial system as a global and neutral service provider, SWIFT is suspending certain Iranian banks' access to the messaging system," it said. 

“This step, while regrettable, has been taken in the interest of the stability and integrity of the wider global financial system."

SWIFT, the Belgian-based Society for Worldwide Interbank Financial Telecommunication, provides banks with a secure messenger network to allow international transfers.

Without its services, Iranian banks will find it more difficult to do business with any client prepared to brave US sanctions to maintain ties with Tehran.

Some US sanctions on Iranian banks and oil exports had been suspended after Iran signed a landmark 2105 deal with six world powers to curtail its nuclear ambitions.

But these came back into effect Monday after President Donald Trump pulled out of the accord and demanded that the world again turn up the economic heat on Tehran.

US Secretary of State Mike Pompeo said waivers would be issued to allow eight countries to buy Iranian oil, but that otherwise the measures would be "relentless."

This could mean European and other banks and businesses face secondary sanctions if Washington deems them in breach of sanctions, and US officials have been pressing SWIFT to act.

The network connects 11,000 banks and financial institutions in 200 countries and territories, while priding itself on taking a neutral political stance. 

It does not hold or manage client funds, but allows the banks to transfer funds by sending messages across the network. 

Photo Credit: SWIFT

Iran Vows to 'Proudly Bypass' US Sanctions

Iran's President Hassan Rouhani said the Islamic republic "will proudly bypass sanctions" by the United States that took effect on Monday targeting the country's oil and financial sectors.

"I announce that we will proudly bypass your illegal, unjust sanctions because it's against international regulations," Rouhani said in a televised speech.

"We are in a situation of economic war, confronting a bullying power. I don't think that in the history of America, someone has entered the White House who is so against law and international conventions," he added.

The measures described by Washington as "the toughest sanctions ever" follow US President Donald Trump's controversial decision in May to abandon the multi-nation nuclear deal with Tehran.

The latest tranche aim to significantly cut Iran's oil exports—which have already fallen by around one million barrels a day since May—and cut it off from international finance.

The United States has given temporary exemptions to eight countries—including India, Japan and Turkey—to continue buying oil in a bid to avoid disturbing their economies and global markets.

But US Secretary of State Mike Pompeo vowed to push Iran's oil sales to zero.

"Watch what we do. Watch as we've already taken more crude oil off the market than any time in previous history," he told CBS's "Face the Nation" on Sunday.

Trump's administration says it wants a new deal with Iran that curbs its interventions around the Middle East and missile program—demands that have been flatly rejected by Tehran.

"Constantly they are sending us messages saying 'Let's sit and negotiate.' Negotiations for what?" said Rouhani.

"First, you respect the negotiations we already concluded, so that there are grounds for the next negotiations."

'Act on Your Commitments'

Rouhani said four countries had approached him during his visit to New York for the UN General Assembly in September, offering to mediate with the US but he turned them down.

"There is no need for mediation. There is no need for all these messages. Act on your commitments, and we will sit and talk," he said.

Iran's economy was already suffering from major structural problems—including major banking issues—before Trump walked out of the nuclear deal.

But Trump's announcement in May helped fuel a run on Iran's currency that has seen the rial lose more than two thirds of its value, driving up prices and forcing the government to resort to food handouts for the country's poor.

Rouhani came to power in 2013, vowing to rebuild ties with the world and attract billions of dollars in foreign investment.

The other parties to the nuclear deal—Britain, France, Germany, China and Russia—have all vehemently opposed the US move and vowed to keep trade going, though they are struggling to convince private companies to stand up to US pressure.

Most of the international firms who lined up to work in Iran after the 2015 deal have been forced to leave, including France's Total, Peugeot and Renault, Germany's Siemens.

"Today, it's not just us who are angry with America's policies. Even European companies and governments are angry with America's policies," said Rouhani.

Photo Credit: IRNA

Iran Guardian Council Rejects Terror Financing Bill

Iran's powerful Guardian Council on Sunday rejected a bill on joining the UN convention against terrorist financing seen as crucial to maintaining trade and banking ties with the world.

The conservative-dominated council, which oversees legislation passed by the parliament, said aspects of the bill were against Islamic law and the constitution and sent it back to lawmakers for revision.

"The Guardian Council has in several sessions reviewed the bill... and it has considered it to have flaws and ambiguities," wrote spokesman Abbas Ali Kadkhodaie on Twitter.

The bill, narrowly passed by parliament on October 7, is one of four put forward by the government of President Hassan Rouhani in order to meet demands set by the international Financial Action Task Force (FATF), which monitors countries' efforts to tackle money-laundering and terrorist financing.

Many hawks in Iran say the laws would limit the country's ability to support "resistance groups" such as Lebanon's Hezbollah and Palestinian Hamas by bringing greater transparency to its accounts.

But Rouhani's government argues it is particularly vital after the United States walked out of the 2015 nuclear deal and reimposed sanctions.

The other parties to the deal—Britain, France, Germany, China and Russia—have sought to salvage the agreement and maintain trade with Iran, but have demanded that it accede to the FATF.

Iran is alone with North Korea on the FATF, although the Paris-based organisation has suspended counter-measures since June 2017 while Iran works on reforms.

Last month, the FATF gave Iran another extension to February to update its laws.

"Neither I nor the president can guarantee that all problems will go away if we join (the UN convention), but I guarantee that not joining will provide the US with more excuses to increase our problems," said Iran's Foreign Minister Mohammad Javad Zarif during the parliament debate last month.

A previous bill on the mechanics of monitoring and preventing terrorist financing was signed into law in August.

But two others—on money-laundering and organized crime—have also been delayed by higher authorities, including the Guardian Council, after being approved by parliament.

The council is made up of six clerics appointed by supreme leader Ayatollah Ali Khamenei and six lawyers appointed by the judiciary.

Photo Credit: IRNA

'I Won't Survive': Iranians Reel From Sanctions

Seventy-year-old Heidar Fekri has been selling industrial equipment from his small store in a Tehran bazaar since before the revolution, but for the first time he is not sure he can survive.

He means it literally: "My shelves are empty, my warehouses are empty and soon I will have to close the doors. This has been my entire life—I won't survive long after the doors close."

Iran's economy had plenty of problems even before US President Donald Trump decided in May to abandon the 2015 nuclear deal and reimpose "crippling" sanctions.

But that move exacerbated a record drop in Iran's currency, down 70 percent in the past year, and prompted an exodus of foreign firms.

Anticipation of the return of the oil embargo—due to kick in on Monday—has already plunged the country into recession and will see the economy shrink by 3.6 percent next year, says the International Monetary Fund.

For Fekri, who has been bringing in industrial pumps and drills from Europe for 47 years, the uncertainty means he has not imported anything for more than a year.

“Sales have dropped 90 percent compared with six months ago. The whole bazaar is suffering," he told AFP.

Almost all products in Iran—from medicines to aircraft spares to plastic bottles—is tied into the global supply chain, so the currency collapse and renewed isolation threatens every corner of society.

The government has been forced to provide food baskets to around half Iran's households as inflation soars.

'Bullying'

For the middle class, perhaps the biggest blow is psychological, as the burst of hope that accompanied the nuclear deal in 2015—the promise of the country finally shedding its pariah status—has evaporated.

"No one knows what the Americans actually want. We did everything they wanted and it wasn't enough. It feels like bullying," said Sam Cordier, head of PGt Advertising, which represents foreign clients such as British Airways and Nestle in Tehran.

Washington says the sanctions are designed to curtail Iran's "destabilizing" activity in the Middle East, but many see them as an attempt to trigger a revolution.

"It's not fair for the Americans to incite violence. If this continues, all the professional businessmen with something to share through knowledge and investment will leave," said Cordier.

He was forced to sack six of his 30 staff and reduce salaries for the rest as, one by one, his foreign clients packed their bags.

"I was crying every 10 minutes when I told them. These are the people who are being hurt. Many young, educated people are leaving the country. There's a massive brain-drain," he said.

'Burned Generation'

There is plenty of hatred towards the Trump administration, but a surprising number of Iranians pin the blame on their own government for not better protecting them.

"Yes, America is doing bad things but they are looking out for their interests. If our state had looked out for Iran's interests, we wouldn't have the situation we have now," said Erfan Yusufi, 30, whose hip new coffee shop is struggling to cope with rising prices and falling demand.

Iran's leaders face a tricky balancing act, remaining defiant in the face of US pressure, while acknowledging the economic pain felt in the country.

"All of us understand people are suffering and under pressure," President Hassan Rouhani told parliament last weekend.

"We cannot tell our people that because of America's pressure, we cannot do anything. This answer is not acceptable." 

He blamed foreign media for "filling people's minds with false propaganda" about soaring prices, though Iran's own central bank says food prices rose 46.5 percent in the year to September.

For all the problems, there is little sign that Iranians want another revolution, not least because a sizeable number are still fiercely supportive of the last one.

Most others are fearful of violent unrest, cowed by the security forces or uninterested in doing the bidding of a foreign power.

There is instead a sad resignation among many young people, who often refer to themselves as the "burned generation" for having been denied the chance to realize their potential.

"I'm worried about the future," said Yusufi in his coffee shop. "Our generation starts each day not knowing what will become of us."

Photo Credit: IRNA

Trump Has 'Disgraced' US Prestige: Iran's Khamenei

Iran's supreme leader Ayatollah Ali Khamenei said Saturday that President Donald Trump has "disgraced" US prestige and would be the ultimate loser from renewing sanctions on the Islamic republic.

"This new US president... has disgraced the remnant of America's prestige and that of liberal democracy. America's hard power, that is to say their economic and military power, is declining too," he said on his Persian Twitter account, quoting a speech in Tehran. 

A defiant Khamenei dismissed the renewed US sanctions—including an oil embargo—that take effect on Monday.

"The challenge between the US and Iran has lasted for 40 years so far and the US has made various efforts against us: military, economic and media warfare," he said.  

"There's a key fact here: in this 40-year challenge, the defeated is the US and the victorious is the Islamic republic."

Trump announced in May he was withdrawing from the 2015 nuclear deal and reimposing sanctions, sparking outrage among world powers who say Iran has been complying with commitments to restrict its atomic program.

Washington says it wants a new deal with Iran, curtailing its regional interventions and missile program—demands which have been flatly rejected by Tehran.

’Self-Sufficiency'

The renewed sanctions are designed "to paralyze (Iran's) economy and keep 

it backward. However, it has resulted in encouraging a movement towards self-sufficiency in the country," Khamenei added.

“Our youth, across the country, support independence. Some may not be so religious but they are sensitive towards domination by foreigners."

On Friday, the US said it would add 700 individuals and entities to its Iran blacklist and push the SWIFT global banking network to cut off Tehran as Washington applies "maximum pressure" to cripple the country's economy.

Secretary of State Mike Pompeo said eight countries—believed to include India, Japan and possibly China—would be given waivers to continue importing Iranian oil in order to avoid upsetting the global crude market, but only on condition they slow their purchases.

The reimposition of sanctions "is aimed at depriving the regime of the revenues it uses to spread death and destruction around the world", Pompeo said.

"Our ultimate aim is to compel Iran to permanently abandon its well-documented outlaw activities and behave as a normal country."

Britain, France, Germany and the European Union strongly condemned the latest actions from Washington in a joint statement, and have vowed to preserve the nuclear deal, known formally as the Joint Comprehensive Plan of Action (JCPOA).

"The JCPOA is a key element of the global nuclear non-proliferation architecture and of multilateral diplomacy," they said.

"It is crucial for the security of Europe, the region, and the entire world. The JCPOA is working and delivering on its goal."

The US wants Iran to withdraw from war-ravaged Syria, where the Shiite clerical regime is a key ally of President Bashar al-Assad, and end longstanding support to regional militant movements Hezbollah and Hamas, as well as Yemen's Huthi rebels.

Iran's foreign ministry welcomed the show of support from Europe, saying "the continued life of the JCPOA depends on the success" of their efforts to safeguard trade.

The ministry, in a statement, said the US sanctions were a violation of the JCPOA, UN resolutions and "a neglect of humane, moral and ethical values.”

Photo Credit: IRNA

Iran Tankers Go Dark to Keep Selling Oil

Working from their small offices in Stockholm, analysts at a new watchdog that monitors global oil shipments have been run ragged by Iran's efforts to skirt US sanctions this month.

In late October, every single one of Iran's vessels "went dark", switching off their transponders to avoid international tracking systems—a first since TankerTrackers.com began operating in 2016.

The ships can now only be tracked manually using satellite imagery.

"It's the first time I've seen a blanket black-out. It's very unique," co-founder Samir Madani told AFP. 

It is part of efforts by Iran and its customers to keep oil flowing ahead of a new US embargo set to hit on Monday. 

"Iran has around 30 vessels in the Gulf area, so the past 10 days have been very tricky, but it hasn't slowed us down. We are keeping watch visually," added co-founder Lisa Ward.

Huge improvements in commercially available satellite imagery in recent years have allowed firms like TankerTrackers to watch the progress of vessels on a daily basis, where once images would have come only once a week or more.

Iran hopes less transparency will allow it to keep selling oil after November 5 when the United States reimposes the last set of sanctions lifted under the 2015 nuclear deal, which Washington abandoned in May. 

But Joel Hancock, from analysis firm Natixis, said this did not mean their sales would necessarily remain high. 

"The main issue with tanker trackers is they are tracking exports, maybe not sales," he told AFP, adding that the ships could just be moving oil to storage facilities in China or elsewhere. 

Another method—used during the last sanctions period between 2010 and 2015—is to keep oil on huge tankers off the Gulf Coast. 

TankerTrackers says there are currently six vessels, with a total of 11 million barrels of capacity, parked offshore as floating storage containers—freeing up port capacity and allowing for quick deliveries.

'Dead in the Water'

Although precise figures are rarely available in the notoriously opaque oil market, most analysts say Iran's exports dropped from around 2.5 million barrels per day in April to roughly 1.6 million in October.

Countries with close security and trade ties with the US were quick to cut their purchases—South Korea went almost straight to zero, with Japan and much of Europe close behind. 

Although the European Union has vowed to create a "special purpose vehicle" (SPV) to protect companies buying oil, analysts see little chance that firms will risk US penalties by using it. 

"The SPV is currently dead in the water. It can't handle oil in any serious volume," said Henry Rome, a specialist on Iran sanctions for the Washington-based Eurasia Group consultancy. 

The US granted waivers to eight countries but only on condition they make substantial cuts to their purchases.

But the trickiest customers for the US in its "maximum pressure" campaign are the biggest buyers, India and China.

China, the largest buyer of Iranian oil, has been surprisingly willing to play ball with sanctions so far, in part because it has bigger fish to fry in the form of its ongoing trade war with Washington. 

During the last sanctions period, China funneled almost all its Iranian transactions through the Bank of Kunlun, controlled by Chinese state energy group CNPC, which was sanctioned by the US in 2012 but shielded the rest of the sector from penalties. 

"Kunlun was a sacrificial lamb in the past... but Chinese banks appear to have realised the immense risk and are a lot more cautious," said Rome. 

Unconfirmed reports suggested this month that the Bank of Kunlun was quietly halting transactions with Iran. 

But China is likely to seek new paths to keep the oil flowing, according to Rome.

"It looks like they'll open another channel, maybe another bank, and keep importing sizable amounts, but there's still a lot to work out," he said.

India, another major buyer, will also be looking for mechanisms as they did during the last sanctions period. 

"The difference last time was that sanctions were phased in gradually over a long period," said Rome.

"There's a certain panic this time that they are being required to make very substantial reductions immediately, and also that banking systems are much more intertwined than in the past." 

Even if Iran can continue to sneak oil out of its ports, it will find it difficult to get the cash into its accounts. 

“Iran is a formidable adversary, well practiced in different techniques to keep selling oil and muddle the data, but that won't be a panacea for everything," said Rome. 

Photo Credit: Depositphotos

Transcript: Special Representative for Iran Brian Hook Briefs Reporters on Iran Sanctions

This transcript was published by the Office of the Spokesperson at the U.S. Department of State. The briefing took place on November 2, 2018.

MR HOOK:  I’m happy to take questions.  And you’ve heard the Secretary talk.  I just (inaudible).

QUESTION:  What are the eight countries?

MR HOOK:  Huh?

QUESTION:  What are the eight countries? 

QUESTION:  What are the eight countries? 

MR HOOK:  Monday.  Monday.

QUESTION:  Can you at least say what are the two that said that they will cut to zero since it seems the negotiations with them are over?

MR HOOK:  It’ll – it’s all going to be announced on Monday.

QUESTION:  But why do all of this today if there’s so little detail available today?

MR HOOK:  There was a lot of detail today.  There was a full briefing by both secretaries.  So --

QUESTION:  There was not a lot of detail.

MR HOOK:  The sanctions go back into effect on Monday.  This was a preview today.

QUESTION:  Can I ask, though, similar to the question Arshad asked on the – using the word jurisdiction instead of country, can we assume that a certain island that begins with “T” is the reason that you’re using jurisdiction instead of country?  Or is that --  

MR HOOK:  I think --  

QUESTION:  Taiwan.  I’ll --

QUESTION:  Could jurisdiction mean more than one government, or does it mean one government?

MR HOOK:  Is this what Secretary Mnuchin said?

QUESTION:  He said – no, Pompeo.

QUESTION:  Both, both.  Pompeo – both of them said --

QUESTION:  They used the word jurisdictions.

QUESTION:  -- jurisdiction not country, which is why – I mean, it’s a technical point, but I’m just – and I get – I can understand that you don’t want to give the names.

MR HOOK:  I don’t know all of them.  I don’t know.  

QUESTION:  But are all of the eight countries?

QUESTION:  Single governments?

QUESTION:  Countries?

MR HOOK:  Yes.

QUESTION:  Yes countries or yes governments?

MR HOOK:  They are – they are -- 

QUESTION:  If Taiwan is among them, that would be a reason to -- 

MR HOOK:  I get it.  They’re nations.  They’re nations.

QUESTION:  Okay.  So Taiwan is not.

MR HOOK:  I’m not going to say what it’s not.  I’m saying that eight nations.

QUESTION:  Can I get a clarification on the SREs?

MR HOOK:  Yeah.

QUESTION:  Yesterday you said the waiver is granted for a six-month period and then re-evaluated. 

MR HOOK:  That’s by statute.

QUESTION:  Right.  And then the Secretary said it will take them weeks longer to wind down.  Is that all-encompassing for the eight that are being granted or just --  

MR HOOK:   No, he was – there he was talking about two of the countries that will receive an SRE are going to be given a little extra time, weeks of time, to get to zero.

QUESTION:  But they – if they can still – the waiver is for six months still by statute?

MR HOOK:  But operationally it’s only relevant for the first few weeks of the – but by law, when we give an SRE, it’s for 180 days.

QUESTION:  Right.

MR HOOK:  And that’s under the National Defense Authorization Act of 2012, NDAA.  And so it’s a 180-day SRE.  It doesn’t matter whether they go to – I mean, it’s – each country is different.  In two of the countries, they will be getting to zero before the expiration of the SRE.

QUESTION:  Can you talk about kind of the broader efforts on trying to get Iran to behave like a normal regime?  I mean, does that include kind of the Twitter messaging or social media messaging, or is it something more than that, more concrete about supporting opposition groups or protestors?

QUESTION:  Is it more than just Twitter messages?  Is there something – is the U.S. doing something to kind of promote protestors?

MR HOOK:  The Iranian regime has historically not come to the negotiating table absent significant economic and diplomatic pressure.  The reimposition of our sanctions are designed to do two things:  deny the regime the revenue it needs to fund violent wars abroad, and also to change the cost-benefit analysis in our favor so that Iran decides to come back to the negotiating table. 

The Ayatollah Khamenei has said that require hostility with the United States, which is the kind of thing that you expect to hear from a revolutionary regime.  We have been very clear.  Secretary Pompeo has been very clear that we have an ear open to what is possible.  We very much want to begin work on a new and better deal to replace the insufficient Iran nuclear deal that the President left in May, and our campaign of maximum economic pressure is a critical tactic to achieve that goal.

QUESTION:  But he’s also talking about restoring democracy. 

MR HOOK:  The President, the Secretary of State, the Vice President, at all levels of the administration, have stood with the Iranian people and their aspirations for a better way of life.  The Iranian people want a more representative government, a government that does not rob them blind, that supports their human rights, their economic rights, their freedom of expression, freedom of assembly.  These are all rights that the United States wants for the Iranian people.  We think they deserve a much better way of life, and Secretary Pompeo has repeatedly made remarks addressed to the Iranian people in support of their demands for reforms from this regime.

QUESTION:  How – I want to ask the question that Gardiner asked yesterday about the Khashoggi murder and the war in Yemen and how any of that is playing into this.  I mean, how can you, on the one hand, focus so much on Iran’s human rights record while not doing enough to pressure the Saudis on some of the same very issues?

MR HOOK:  We do not share interests or values with the Iranian regime.  We have asked Saudi Arabia to increase the production of oil while we take off Iranian oil from the market, and Saudi Arabia has been very helpful to ensure an adequately supplied oil market during this period where we have seen dramatic reductions in the import of Iranian crude as part of our maximum economic pressure campaign.  The Saudi Government has successfully insulated oil from broader political issues, and that has been helpful in the broader context of our pressure campaign.

QUESTION:  Well, just to be devil’s advocate here, I understand the shared interests that you have with the Saudis on Iran.  But what shared interests, what shared values does the U.S. have with the Saudis – respect for human rights?

MR HOOK:  I can only speak to how the Saudis have helped our Iran strategy.  The President gave a speech in Riyadh on his first trip overseas as president, where he called upon our Sunni Arab partners to increase their capabilities to reverse Iranian hegemony so that our Arab partners can shoulder more of the burden in the Middle East.  And we have enjoyed a great deal of cooperation from Gulf countries and beyond to isolate Iran and to apply as much economic pressure as possible so that they don’t have the money they need to destabilize the Middle East.

QUESTION:  How is this escrow account that he talked about going to work, and how do you make sure that the Iranians are going to get basic needs fulfilled – medicine, food?

MR HOOK:  The escrow accounts that are being created for those nations that need to continue importing Iranian oil deny Iran hard currency, and it denies Iran any revenue from oil sales.  Any time Iran sells oil, that money goes into an escrow account in the importing nation’s bank, and Iran has to spend down that credit.  We strongly encourage those nations to ensure that Iran spends that money on humanitarian purchases to benefit the Iranian people.  The longest-suffering victims of the Iranian regime are the Iranian people.  This regime uses fake companies disguised as humanitarian organizations to divert purchases that should go to food, medicine, and medical devices, and they use that to enrich the regime and support revolutionary activities overseas.

QUESTION:  So you’re counting on countries like China to make sure that they don’t use money for those things?

MR HOOK:  The United States will be monitoring these escrow accounts very closely.  Unlike in prior administrations, we will ensure that the money is not spent on illicit activities, that there isn’t any leakage in these escrow accounts, and we will work closely with countries to encourage the purchase and – the sale and purchase of humanitarian goods to benefit the Iranian people.  Our sanctions regime has very clear exceptions for the sale of food, medicine, and medical devices.

QUESTION:  So how does the travel ban fit into the U.S. support for Iranian people?

MR HOOK:  Because the Iranian regime is the largest sponsor of terrorism in the world, we have a restrictive visa policy.  And that policy is driven by the terrorism of the regime.  It is not driven by a desire to restrict the average Iranian people.  The problem we have is --

QUESTION:  But it does.

MR HOOK:  But that is the problem of the regime.  If the regime would stop funding terrorism and open up its economy so that we can see where the money goes, it would create a much better environment for us to be granting visas.

QUESTION:  So for the countries that you say need to keep importing oil, do you foresee issuing these exemptions over and over again?  Are you going to put an upper limit on how many times they’ll be renewed?

MR HOOK:  Our goal remains getting countries to zero imports of Iranian oil.  In 2019, our projections are that oil supply will exceed demand, and that creates a much better atmosphere for us to bring remaining nations to zero as quickly as possible.

QUESTION:  So you’re not putting an upper limit on how – for how – how many times these exemptions will be renewed at this point?

MR HOOK:  We are not looking to grant additional SREs at the end of the 180-day period.  We are being very careful to advance our maximum economic pressure campaign without increasing the price of oil.  Next year we anticipate a stronger oil supply coming online, and that will allow us to accelerate the path to zero.

QUESTION:  And are you – how many Iranian banks will be cut off from SWIFT?  I mean, the administration is saying more than prior, but can you give a number?

MR HOOK:  That will be announced by Secretary Mnuchin on Monday.

QUESTION:  He did say, though, on this subject – he was very precise in his language.  He said “certain designated Iranian financial institutions.”  That does not categorically mean all.  So is it possible that either, one, don’t redesignate all of the banks that had previously been designated; and two, is it possible that some designated bank, because he used the word “certain designated,” would not be required to disconnect?

MR HOOK:  I’m not going to interpret what “certain” means beyond saying that he will announce all the banks on Monday.

QUESTION:  The 20 – 20 countries import 80 percent of Iran’s oil, as I understood – stand.  Are those eight countries, any of them, among those 20 – the eight countries receiving the SREs?

MR HOOK:  That there’s a small group of – that there’s a – there is a relatively small number of countries that make up the lion’s share of the import of Iranian crude.

QUESTION:  And are any of them getting exemptions?

MR HOOK:  I’m not going to get ahead of the Secretary’s announcement on Monday.

QUESTION:  Can you offer a little clarity on the response about non-U.S. civil nuclear cooperation?  Will waivers be granted in that --

MR HOOK:  The Secretary addressed that this morning, and it’ll be announced on Monday.

QUESTION:  On the humanitarian transaction, Europeans have expressed concern in the past weeks that even though there were exemptions to humanitarian goods and services, the financials mechanism were not safe enough, that you have to clarify what are the means by which the countries and entities can do those kind of transactions.  Do you think that what you announced today clarifies this and that it’s safe to do humanitarian transactions with Iran?

MR HOOK:  The Iranian regime has a history of creating front companies to divert the distribution of humanitarian goods.  Financial institutions around the world know of Iran’s history of deceiving banks on the sale of humanitarian goods.  The burden is on Iran to open up its dark economy so that banks around the world have more confidence that when they facilitate humanitarian transactions that the humanitarian goods will reach the Iranian people. 

The United States is the largest donor of humanitarian assistance in the world.  Every sanctions regime we have makes exceptions for food, medicine, and medical devices.  That is, we have done our part; the Iranian regime needs to do its part by making those transactions possible in an open and transparent financial system.

QUESTION:  Sounds like there’s not very many safe ways of trade – like, for pharmaceutical companies and medical companies.

MR HOOK:  The Iranian regime makes it very difficult to facilitate the sale of humanitarian goods and services.

QUESTION:  The Europeans says that the fear is that even if you sell humanitarian goods to Iran, you will be target by U.S. sanctions, so they addressing this to you and not to Iran.

MR HOOK:  Say that again?

QUESTION:  The European countries say that companies fear that if they sell those goods to Iran, they will be targeted by U.S. sanctions.  So they ask you to say what are the safe channels to do that.

MR HOOK:  The burden is not on the United States to identify the safe channels.  The burden is on the Iranian regime to create a financial system that complies with international banking standards to facilitate the sale and provision of humanitarian goods and assistance.

QUESTION:  Right, but I think that the point is that they are looking for some kind of, like, assurance --

QUESTION:  Guidance from OFAC.

QUESTION:  Guidance.

MR HOOK:  We have been – OFAC has given very clear guidance over many years --

QUESTION:  That’s not what the Europeans say.

MR HOOK:  We have done our part to permit the sale of humanitarian goods to Iran.  That is our part.  That is our role.  Iran has a role to make these transactions possible.  Banks do not have confidence in Iran’s banking system – often don’t have confidence in Iran’s banking system to facilitate those transactions.  That’s Iran’s problem; it is not our problem.

QUESTION:  But banks do not have confidence, the companies do not have confidence in Iran banks because they are subject to American sanctions from now on.

MR HOOK:  That’s not true.

QUESTION:  That’s what the Europeans say.  I’m just --

MR HOOK:  I’m giving you the answer. 

QUESTION:  We were expecting the list.  (Laughter.)

MR HOOK:  But he told you it was coming Monday.

QUESTION:  Why is it that – and when you say Monday, this isn’t going to be at literally 12:01 Monday morning, is it?  Or I mean --

MR HOOK:  No.  The Secretary will announce it on Monday, and then it will be published in the Federal Register.

QUESTION:  Okay, but he’ll announce it – what, do you have any – like, I just want it for personal planning purposes.

MODERATOR:  About 8:30 in the morning.

QUESTION:  8:30 Monday morning and not beforehand.  So in other words, I – at 12:01 Monday morning, they go into effect --

MR HOOK:  Yes.

QUESTION:  -- but there won’t be a – like, is something going to go up on the Treasury website at 12:01?  I mean, I’m just trying to figure out --

MR HOOK:  I don’t know about that.  For our part, on the SREs and anything else will be announced on Monday.  I don’t – Treasury may have a different way where at 12:01 they have to --

QUESTION:  So you guys aren’t planning on saying who the eight are at 12:01.

MR HOOK:  No.  No.  No.

QUESTION:  But presumably these eight are aware that – right, they’ve been told that they’re okay to – because they’re all coming out of the woodwork now, the Turks, the Italians, the South Koreans, the Indians, the – they are.

MR HOOK:  I think you’ve answered your own question.

QUESTION:  Well, I just want to make sure no one’s lying.

MR HOOK:  Oh.  We’ll announce it on Monday.

QUESTION:  And so will we see sanctions on the countries that aren’t getting these things on Monday?

MR HOOK:  We expect – well, we have already seen enormous pre-compliance with the reimposition of our sanctions because corporations around the world are rightly choosing to sell goods and services in the United States over the Iranian market if given the choice.

QUESTION:  But I mean, weren’t we going to see sanctions on big countries that aren’t – that don’t get these waivers?  Are you going to – sanctions announced on Monday?

MR HOOK:  We expect nations around the world to comply with sanctions because it’s in their interest, and it promotes our broader national security objectives to address a significant and expanding threat to peace and security.

Okay.

QUESTION:  Thank you.

MR HOOK:  All right, thank you.

Photo Credit: State Department

Transcript: Pompeo and Mnuchin Brief Reporters on Forthcoming Iran Sanctions

This transcript was published by the Office of the Spokesperson at the U.S. Department of State. The briefing took place on November 2, 2018.

MS NAUERT:  Thank you, sir.  Good morning, everyone, and welcome to today’s on-the-record call on the Iran snapback sanctions.  We’re pleased to have with us Secretary of State Mike Pompeo and Secretary of the Treasury Steve Mnuchin.  They will each have brief remarks at the top and then take several of your questions.  We’ll start first with Secretary Pompeo. 

Secretary, please, go ahead.

SECRETARY POMPEO:  Thank you, Heather.  Good morning, everyone, and thank you for joining the call.  Earlier this year, President Trump withdrew from the fatally flawed nuclear deal and implemented a new campaign aimed at fundamentally altering the behavior of the Islamic Republic of Iran.  This part of the campaign about which we’re speaking today is simple.  It is aimed at depriving the regime of the revenues that it uses to spread death and destruction around the world.  Our ultimate aim is to compel Iran to permanently abandon its well-documented outlaw activities and behave as a normal country.

Today, Secretary Mnuchin and I will discuss one of the many lines of effort to achieve these fundamental changes in the Iranian regime’s behavior as directed by the President.  While important, these economic sanctions are just a part of the U.S. Government’s total effort to change the behavior of the Ayatollah Khomeini, Qasem Soleimani, and the Iranian regime.

On November 5th, the United States will reimpose sanctions that were lifted as part of the nuclear deal on Iran’s energy, ship building, shipping, and banking sectors.  These sanctions hit at the core areas of Iran’s economy.  They are necessary to spur changes we seek on the part of the regime. 

In order to maximize the effect of the President’s pressure campaign, we have worked closely with other countries to cut off Iranian oil exports as much as possible.  We expect to issue some temporary allotments to eight jurisdictions, but only because they have demonstrated significant reductions in their crude oil and cooperation on many other fronts and have made important moves towards getting to zero crude oil importation. These negotiations are still ongoing.  Two of the jurisdictions will completely end imports as part of their agreements.  The other six will import at greatly reduced levels.

Let me put this in context for you.  The Obama administration issued SREs to 20 countries multiple times between 2012 and 2015.  We will have issued, if our negotiations are completed, eight and have made it clear that they are temporary.  Not only did we decide to grant many fewer exemptions, but we demanded much more serious concessions from these jurisdictions before agreeing to allow them to temporarily continue to import Iranian crude oil.  These concessions are critical to ensure that we increase our maximum pressure campaign and accelerate towards zero.

Our laser-focused approach is succeeding in keeping prices stable with a benchmark Brent price right about where it was in May of 2018 when we withdrew from the JCPOA.  Not only is this good for American consumers and the world economy, it also ensures that Iran is not able to increase its revenue from oil as its exports plummet.  We will, we expect, have reduced Iranian crude oil exports by more than 1 million barrels even before these sanctions go into effect. 

This massive reduction since May of last year is three to five times more than what many analysts were projecting when President Trump announced our withdrawal from the deal back in May.  We exceeded our expectations for one simple reason: Maximum pressure means maximum pressure.

The State Department closed the Obama era condensate loophole which allowed countries to continue importing condensate from Iran even while sanctions were in place.  This loophole allowed millions of dollars to continue to flow to the regime. 

This administration is treating condensate the same as crude since the regime makes no distinction between the two when it decides to spend its oil revenue on unlawful ballistic missiles, terrorism, cyberattacks, and other destabilizing activities like the assassination plot Denmark disclosed this past week. 

And starting today, Iran will have zero oil revenue to spend on any of these things.  Let me say that again.  Zero.  One hundred percent of the revenue that Iran receives from the sale of crude oil will be held in foreign accounts and can be used by Iran only for humanitarian trade or bilateral trade in nonsanctioned goods and services.  

These new sanctions will accelerate the highly successful effects of our sanctions that have already occurred.  The maximum pressure we imposed has caused the rial to drop dramatically, Rouhani’s cabinet is in disarray, and the Iranian people are raising their voices even louder against a corrupt and hypocritical regime.

On that note, our actions today are targeted at the regime, not the people of Iran, who have suffered grievously under this regime.  It’s why we have and will maintain many humanitarian exemptions to our sanctions including food, agriculture commodities, medicine, and medical devices. 

I will now turn the call over to Secretary Mnuchin.

SECRETARY MNUCHIN:  Thank you very much.  Since the beginning of the Trump administration, the Treasury Department has been committed to putting a stop to Iran’s destabilizing activities across the world.  We’ve engaged a massive economic pressure campaign against Iran, which remains the world’s largest state sponsor of terrorism.  To date, we have issued 19 rounds of sanctions on Iran, designating 168 targets as part of our maximum pressure campaign.  We have gone after the financial networks that the Iranian regime uses to fuel its terrorist proxies and Hizballah and Hamas, to fund the Houthis in Yemen, and to support the brutal Assad regime in Syria.

The 180-day wind-down period ends at 11:59 p.m. Eastern Standard Time on Sunday November 4th.  As of Monday November 5th, the final round of snapback sanctions will be enforced on Iran’s energy, shipping, shipbuilding, and financial sectors.  As part of this action on Monday, the Treasury Department will add more than 700 names to our list of blocked entities.  This includes hundreds of targets previously granted sanctions relief under the JCPOA, as well as more than 300 new designations.  This is substantially more than we ever have previously done.  Sanctions lifted under the terms of Iran’s nuclear deal will be reimposed on individuals, entities, vessels, and aircraft that touch numerous segments of Iran’s economy.  This will include Iran’s energy sector and financial sectors.  We are sending a very clear message with our maximum pressure campaign that the U.S. intends to aggressively enforce our sanctions.  Any financial institution, company, or individual who evades our sanctions risks losing access to the U.S. financial system and the ability to do business with the United States or U.S. companies.  We are intent on ensuring that global funds stop flowing to the coffers of the Iranian regime. 

I want to make a couple of comments on the SWIFT messaging systems since I’ve received lots of questions about this over the last few weeks.  So I’d like to make four points.  Number one, SWIFT is no different than any other entity.  Number two, we have advised SWIFT the Treasury will aggressively use its authorities as necessary to continue intense economic pressure on the Iranian regime, and that SWIFT would be subject to U.S. sanctions if it provides financial messaging services to certain designated Iranian financial institutions.  Number three, we have advised SWIFT that is must disconnect any Iranian financial institution that we designate as soon as technologically feasible to avoid sanctions exposure.  Number four, just as was done before, humanitarian transactions to nondesignated entities will be allowed to use the SWIFT messaging system as they have done before, but banks must be very careful that these are not disguised transactions or they could be subject to certain sanctions.  Thank you very much.

MS NAUERT:  Thank you, sirs.  Why don’t we go ahead, take our first question.  We’ll go to Matt Lee with the Associated Press.  Matt, go ahead.

QUESTION:  Thank you, Heather.  Both – either or both of you, on SWIFT, there are a lot of complaints among the President’s allies in Congress that this does not go far enough, and that without designating – without going after SWIFT harder for these messaging transactions, that it allows a serious loophole.  I understand Secretary Mnuchin’s four points on it, but how will you address this criticism?  Because it’s already coming even before this announcement today.

SECRETARY MNUCHIN:  Okay, well let me – Secretary Mnuchin – let me make some comments.  First of all, I think there’s been a lot of fueled misinformation as it relates to SWIFT and what we’re doing with SWIFT.  So that’s why I want to be very clear.  So one, okay, I think there was information that SWIFT would not be subject to sanctions.  That’s not the case.  SWIFT will be subject to sanctions.  Number two, as I said, that – could be subject to sanctions, excuse me.  Number two, it is our intent that they cut off designated entities as was done before.  And again, I think there’s misinformation that they cut off everybody last time.  Again, they did allow for certain entities to do humanitarian transactions consistent with what’s allowed under our sanctions.  There are exceptions for humanitarian sanctions, but I want to very clear, people need to be careful that those are real humanitarian – those are real humanitarian transactions.  So again, I would just say I – hopefully this will clarify the misinformation that’s out there.

MS NAUERT:  Next question, we’ll go to Nick Wadhams from Bloomberg.

QUESTION:  Hi.  I had a question about the oil sanctions going into effect.  Will those include – or will there be exceptions granted for nonhumanitarian transactions such as consumer goods, as were allowed last time, or will Iran only be allowed – or will Iran only be allowed to spend revenue that it gains through – on humanitarian items?  And then second, if you’re giving eight waivers and two jurisdictions are already cutting imports to zero, what’s the point of giving them – those two jurisdictions waivers?  Thanks.

SECRETARY POMPEO:  Nick, this is Mike Pompeo.  With respect to your first point, you’ll see the details on Monday.  There are nonhumanitarian goods that we included in there, but they’re small.  They’re ones that you would’ve already seen in the exemptions that were granted under the direction of the President.  Second, some of these will take a few months to get to zero.  So by November 5th they won’t be there.  That’s the purpose of those exemptions, to give them a little bit longer to wind down.  Weeks.

MS NAUERT:  Pardon me?

SECRETARY POMPEO:  Weeks longer to wind down.

MS NAUERT:  Next question, Mike Warren from the Weekly Standard.

QUESTION:  Hi, gentlemen, thank you.  I want to follow-up on Matt’s questions about SWIFT.  Secretary Mnuchin, you said that certain financial institutions in Iran will be cut off from SWIFT.  Could you explain exactly which financial institutions, or maybe the financial institutions described in a Treasury FAQ, the Central Bank of Iran and other Iranian financial institutions described in section 104(c)(2) blah blah blah – could you be more specific about which institutions?  And how can – how can the United States Government be confident in SWIFT’s ability to monitor transactions using SWIFT that they – I imagine there are numerous of these transactions going on daily.  How can the United States Government be confident that those are not transactions that are funding the bad actions that the government says is – they are trying to stop?

SECRETARY MNUCHIN:  So again, let me comment on the first issue, which – that the list of banks, which will be substantially longer than last time, will be coming out over the weekend.  And as it relates to monitoring transactions, again, financial institutions have liability for any transactions that go through SWIFT or any other mechanisms.  I’m being told the list will come out on Monday.  And again, it’s our expectation that that will be implemented as soon as technologically feasible.

MS NAUERT:  Okay, thank you.  Next question goes to Elise Labott from CNN.

QUESTION:  Thank you.  The question is for both secretaries, but maybe from a different angle.  Could you address the workaround that the Europeans are trying to institute to avoid U.S. banks, maybe using their own central banks or electronic transactions?  For Secretary Mnuchin, how much revenue do you think this would give the Iranians, and how seriously are you taking that in terms of a financial component?

And then Secretary Pompeo, could you talk about once these sanctions go into effect and if the Europeans do try to institute this workaround, what the diplomatic implications for relations with European allies?  Thank you.

SECRETARY MNUCHIN:  I’ll comment on the Special Purpose Vehicle.  I have no expectation that there will be any transactions that are significant that go through a Special Purpose Vehicle based upon what I’ve seen.  But when the details come out of some Special Purpose Vehicle, if there are sanctions – if there are transactions that go through there that have the intent of evading our sanctions, we will aggressively pursue our remedies.

SECRETARY POMPEO:  And let me take the second part of that.  We’ve been working closely with the Europeans on this set of issues.  We’re very confident that our sanctions will be incredibly effective.  And frankly, I can prove that already.  As I stated, the Iranian economy today is already feeling the effects of this.  It’s already feeling the effects of this effort not because the sanctions have snapped back – that won’t occur until – on Monday – but because the world and Iran knew this was coming.  And so European entities of any scale that are doing business with the United States of America have already ceased their conduct with Iran.  There may be an exception to that, but there has been an enormous departure of European businesses.

So whatever it may be that the EU is proposing, the folks who have risk – financial risk, business risk, operation risk – have already made their decision about the effectiveness of the sanctions that will be reimposed this coming week.

MS NAUERT:  Our next question goes to Michele Kelemen with NPR.

QUESTION:  Yeah, hi, thank you.  One quick question that – just technically, which of the eight countries are getting these waivers?  And then secondly, for Secretary Pompeo, you said in one of your interviews this week that the U.S. wants to restore democracy in Iran.  Is that one of the goals of this campaign?  And if so, how do you make sure that these sanctions aren’t going to hurt average Iranians who, as you point out, are suffering under this corrupt regime?

SECRETARY POMPEO:  Yes, thanks for the question.  The President’s policy is very clear:  We are looking to change the Iranian leadership’s behavior.  I laid out the 12 things we’ve asked them to do; that is the goal not only of what we’re speaking about this morning – and please don’t lose sight, we’re talking about a set of sanctions that will be reimposed on Monday.  The administration’s efforts to change Iranian behavior are far broader, far deeper, there are many other lines of effort.  We’re simply focused on this line of effort today because of the significance of November 5th.

My comments about restoring democracy are completely consistent with what we have described before.  We’re counting on the Iranian people to have the opportunity and we are working towards allowing the Iranian people to have the opportunity to have the government they want, a government that doesn’t take wealth from their country and spend it on malign activity around the world.  I mean, this is a regime that is conducting a assassination campaign inside of Europe today, murdering not Iranian citizens in those countries, but folks who live, reside, and are citizens of those European countries.  These are the behaviors we’re trying to change, and our every effort is aimed at giving the Iranian people the opportunity to have the government that they not only want but deserve.

MS NAUERT:  Next question:  Josh Rogin, Washington Post.

QUESTION:  Thank you so much for your time.  Thanks for your service.  I’d like to ask you about the Atomic Energy Organization of Iran.  My understanding is that you waived secondary sanctions on foreign firms that do business with that organization, mostly Russian and Chinese firms that are involved in the Arak and Fordow facilities.  Why did you make that decision, and why are you letting Arak and Fordow continue?  And are there plans to change that in the future?  Thank you.

SECRETARY POMPEO:  Thanks, thanks for the question.  We are not allowing the continued work to develop nuclear weapons and nuclear weapons systems in Arak and Fordow.  We will provide on Monday a complete explanation of what we’re going to do with the continued efforts to prevent those facilities from doing the things that put the world at risk through proliferation, and we’ll give you all the detail.  It’s a long and complex answer, but we’re happy to provide it to you on Monday morning.

MS NAUERT:  Final question to Arshad with Reuters, please.

QUESTION:  Two things.  One, exactly how many financial institutions are going to be redesignated, i.e. put back on the SDN list on Monday?  Previously I believe the number was close to or slightly above 30.  You said it would be substantially more.  How many is it going to be?

Secondly, you pointedly said that you were granting the exceptions to eight jurisdictions.  Is one of those jurisdictions the European Union, thereby covering a much larger group of countries, i.e. 28 EU member-states?

SECRETARY POMPEO:  Steven, you want to go first?

SECRETARY MNUCHIN:  I’ll answer the first part.  So the bank list will come out on Monday.  Again, it will be more than last time, and again, we may continue to add banks to that in the future.  But the original list will come out on Monday and we’ll carefully monitor situations to add on more banks as needed.

SECRETARY POMPEO:  The second part of your question, we will provide the list of the eight jurisdictions on Monday.  The EU will not be receiving an SRE.

MS NAUERT:  The final question, Carol Morello, Washington Post.

QUESTION:  Hi, thanks for doing this.  Say in the past, the Iranians have blended their oil with foreign oil to evade sanctions, and there have already been reports that they are turning off the ID tags on their tankers.  So what in particular are you going to be doing to track their attempts to evade these sanctions?

SECRETARY POMPEO:  Thanks for the question.  Make no mistake about it, the Iranians will do everything they can to circumvent these sanctions – that’s unsurprising to me.  They’ll turn off ships, they’ll try and do it through private vessels, they’ll try and find third parties that don’t interact with the United States to provide insurance mechanisms.  The list of Iranian efforts to circumvent these sanctions is long.  You should all recognize there’s a reason for that.  These sanctions are far tougher than the sanctions that have ever been imposed on the Islamic Republic of Iran.  That is why they are so desperate to find ways to circumvent it. 

And I won’t speak to our efforts to counter those circumvention efforts.  There are many, they are varied, and make no mistake:  The United States is fully prepared to do all that we can to prevent Iran from circumventing not only the crude oil sanctions and the financial sanctions, but all of the designations and all of the other sanctions that are being reimposed this coming Monday and those that are already in place.

SECRETARY MNUCHIN:  And I would just add to that that anybody that does facilitate those transactions will be subject to sanctions and will be added to the list.

MS NAUERT:  Secretary Pompeo, Secretary Mnuchin, thank you so much for joining us.  Everyone, thanks for joining the call.  Have a great day.  We’ll be putting out a transcript shortly.

SECRETARY POMPEO:  Thank you all. 

Photo Credit: Wikicommons

Turkey Exempt From US Sanctions on Iran Oil: Minister

Turkey will be among eight countries allowed by the United States to continue importing Iranian oil, Turkish Energy Minister Fatih Donmez said on Friday.

"We know Turkey is among the countries that will be given an exemption but we do not have the details," the minister said, quoted by state-run news agency Anadolu, as he hailed US statements  to allow imports at low levels after the reimposition of sanctions from Monday.

Donmez hailed US statements to allow imports at low levels after the reimposition of sanctions from Monday.

"I appreciate the positive statement (from Pompeo)," he said after questions from reporters in parliament.

"I believe the point that we have reached will be a positive contribution to the region's peace, comfort and stability," he said, adding that Turkish and American officials held negotiations before Washington's decision.

A US delegation had come to Turkey in July for talks to address Ankara's concerns about the potential negative economic impact of the reimposition of US sanctions against Iran.

Turkey has a strong trade relationship with its neighbor and imports Iranian crude. US President Donald Trump in May decided to abandon the 2015 deal on Iran's nuclear program, signed with other world powers, and bring back nuclear-related sanctions against Tehran.

Pompeo announced that affected countries had pledged to or have already cut back on purchases of petroleum from Iran.

The move "is aimed at depriving the regime of the revenues it uses to spread death and destruction around the world," Pompeo said Friday.

"Our ultimate aim is to compel Iran to permanently abandon its well documented outlaw activities and behave as a normal country."

The US Treasury will also call for the SWIFT global financial network to stop providing services to Iran's banking industry as the United States seeks to hit Tehran over its nuclear programme and alleged support for terrorism.

Relations between Turkey and the US have improved since a diplomatic spat over the two-year detention of an American pastor who was released on October 12.

Earlier on Friday, the NATO allies lifted sanctions against each other's ministers which were implemented in August following a Turkish court's initial refusal to release Pastor Andrew Brunson in July.

Photo Credit: Turkish Ministry Industry

US Details New Sanctions to Hit Iran's Banks, Oil Industry

he United States will add 700 individuals and entities to its Iran blacklist and pressure the global SWIFT banking network to cut off Tehran when expanded sanctions are put in place next week, US officials said Friday.

But eight countries will be able to continue importing Iranian oil at lower levels in order to avoid upsetting global crude markets when the sanctions take effect on Monday, they said.

The US aims to cripple the Iranian economy to pressure Tehran to halt its nuclear activities and what the US says is broad support for "terrorism" in the region, Secretary of State Mike Pompeo said.

The reimposition of sanctions "is aimed at depriving the regime of the revenues it uses to spread death and destruction around the world," Pompeo said.

"Our ultimate aim is to compel Iran to permanently abandon its well-documented outlaw activities and behave as a normal country."

The sanctions come six months after President Donald Trump withdrew from the 2015 nuclear deal struck between world powers and Iran.

At the time, he began reimposing sanctions that had been suspended or removed by his predecessor Barack Obama. That process will be completed starting from midnight Sunday, US eastern time, when sanctions on the regime's banks, shippers, shipbuilders and oil sector are imposed.

The impact remains in question as other countries, particularly Washington's European allies, resist joining its effort to economically strangle the Tehran regime.

The European Union has gone so far as to protect businesses that operate in Iran. It has announced plans for a legal framework through which firms can skirt US sanctions, although few major corporations have been eager to risk the wrath of penalties in the world's largest economy.

"This is not 2012 when the world was united behind sanctions against Iran. This is the Trump administration trying to force the rest of the world to go along with a policy that most countries do not accept," said Barbara Slavin, an Iran expert at the Washington-based Atlantic Council.

"The US has had some success in terms of frightening away major corporations. The sanctions hurt a lot. But Iran is still going to be able to sell oil," especially to China, she said.

Oil Trade Exemptions

Pompeo said the US will grant exemptions to eight countries that have pledged to or have already cut back on purchases of petroleum from Iran, which has long depended on crude exports to power its economy.

He did not name the eight countries, but they are believed to include India, Japan, South Korea, and possibly China.

Pompeo said the countries agreed that the payments for the oil will go into offshore accounts that Iran will only be able to tap for "humanitarian trade, or bilateral trade in non-sanctioned goods and services."

"Maximum pressure means maximum pressure," Pompeo said.

To punish Iranian banks, US Treasury Secretary Steve Mnuchin said the global financial network SWIFT—which enables secure bank-to-bank communications and transactions -- will also be subject to US sanctions if it provides services to Iranian financial institutions on the US blacklist, which includes most major Iranian banks.

That could make it very hard for Iran to do business with other countries.

"SWIFT is no different than any other entity," Mnuchin said.

US Objective in Question

Justifying the action, Pompeo has issued a list of demands for Iran that go well beyond the nuclear program that was the focus of Obama's deal.

He wants the Shiite clerical regime to withdraw from war-ravaged Syria, where it is a critical ally of President Bashar al-Assad, and to end longstanding support to regional militant movements Hezbollah and Hamas.

The US also wants Iran to stop backing Yemen's Huthi rebels, who are facing a US-supported air campaign led by Saudi Arabia.

But experts don't expect Iran's leaders to immediately throw in the towel.

"It's basically magical thinking. The Iranians have been able to continue their support to regional proxies and allies for 40 years despite economic pressure," said Ali Vaez of the International Crisis Group.

He said the Trump administration believed that a constrained, struggling Iran would see its influence erode. But the final goal, he said, was unclear.

"I think the end-game depends on who you're asking. The president himself is interested in having a broader, better deal with the Iranians, but I believe that most of his national security team are interested in either destabilizing Iran or assuring a regime change in Tehran," Vaez said.

Photo Credit: State.gov

Trump Sanctions Set to Bite Iran, But What Next?

Six months after President Donald Trump bolted from a nuclear deal on Iran, the United States from Monday will try to strangle the country's economy with sweeping sanctions, but doubts abound on how effective the campaign will be.

The United States has vowed to reduce sales of Iranian oil, the country's crucial export, as well as international banking transactions, snapping back sanctions lifted by Trump's predecessor as US president, Barack Obama.

But much has changed since the Obama administration targeted Iran's economy in 2012. Obama won broad, if at times begrudging, international support as he set a goal of bringing Iran to the table to end its nuclear program.

Iran—led by a more moderate president, Hassan Rouhani—has according to UN inspectors abided by the 2015 agreement which is still supported by European powers and Russia and China, which all signed the nuclear deal.

"This is not 2012 when the world was united behind sanctions against Iran. This is the Trump administration trying to force the rest of the world to go along with a policy that most countries do not accept," said Barbara Slavin, an Iran expert at the Washington-based Atlantic Council.

"The US has had some success in terms of frightening away major corporations. The sanctions hurt a lot. But Iran is still going to be able to sell oil," especially to China, she said.

The United States has accepted that it will need to issue waivers to countries that do not fully stop buying Iranian oil, with friends of the United States such as India and South Korea looking for sanctions exemptions, and Tehran may keep up clandestine sales.

The European Union has gone so far as to protect businesses that operate in Iran. It has announced plans for a legal framework through which firms can skirt US sanctions, although few major corporations have been eager to risk the wrath of penalties in the world's largest economy.

US Objective in Question

US Secretary of State Mike Pompeo has issued a list of demands for Iran that go well beyond the nuclear program that was the focus of Obama's deal.

He wants the Shiite clerical regime to withdraw from war-ravaged Syria, where it is a critical ally of President Bashar al-Assad, as well as to end longstanding support to regional militant movements Hezbollah and Hamas.

Pompeo has also insisted Iran cut off backing for Yemen's Huthi rebels who are facing a US-backed air campaign led by Saudi Arabia.

In a recent tweet Pompeo crowed that the International Monetary Fund is predicting a 3.6 percent contraction of Iran's economy next year.

"That's what happens when the ruling regime steals from its people and invests in Assad—instead of creating jobs for Iranians, they ruin the economy," he said.

But experts see no rapid turnaround from Iran's leaders—especially the military and clerical establishments, for whom resistance to the United States has been an article of faith since the 1979 Islamic revolution overthrew the pro-US shah.

"It's basically magical thinking. The Iranians have been able to continue their support to regional proxies and allies for 40 years despite economic pressure," said Ali Vaez of the International Crisis Group.

He said the Trump administration believed that a constrained, struggling Iran would see its influence erode. But the final goal, he said, was unclear.

"I think the end-game depends on who you're asking. The president himself is interested in having a broader, better deal with the Iranians, but I believe that most of his national security team are interested in either destabilizing Iran or assuring a regime change in Tehran," Vaez said.

Trump's national security advisor, John Bolton, is a longstanding hawk with ties to Iran's armed, exiled opposition.

North Korea Model?

One European diplomat believed Trump was following his playbook on North Korea, with which he is negotiating only a year after threatening "fire and fury."

“It's the same war plan as with Kim Jong Un and North Korea—sanctions, maximum pressure and then ready to negotiate," he said.

The United States says it is exempting humanitarian goods from the sanctions, although Europeans say they have received no guidance on how to avoid penalties.

Another Western diplomat, speaking to AFP on condition of anonymity, said that Iran was more dependent on the outside world than the country's conservatives would like to think.

"In truth there are starts of a panic as there's beginning to be a shortage of medicine. We're heading back to the old war economy, which is tightly controlled."

Complicating Trump's effort, Saudi Arabia—Iran's regional rival which has long pressed Washington to get tough—is increasingly unpopular after the murder of a journalist, Jamal Khashoggi, in the kingdom's Istanbul consulate.

But Tehran has been winning few friends, with France and Denmark recently accusing the clerical state's intelligence agencies of plotting to attack Iranian opponents in Europe.

Photo Credit: IRNA

US Eyes Limited Waivers for Iran Crude Buyers

The US administration likely will enable some countries to continue importing oil from Iran in the short term, despite Washington's maximum pressure campaign against Tehran, White House national security adviser John Bolton said today.

"We understand, obviously, that a number of countries, some immediately surrounding Iran, and others that have been purchasing oil, may not be able to go all the way to zero," Bolton said at a forum hosted by the Washington-based Alexander Hamilton Society. "We want to achieve maximum pressure, but we do not want to harm friends and allies either. We are working our way through that."

The sanctions statutes that President Donald Trump re-activated in May require the administration to assess by 4 November, and every 180 days after that date, whether buyers of Iranian crude are "significantly reducing" their purchases. The administration can then sanction financial institutions in countries that it deems have not cut their purchases adequately and grant exemptions to countries that do.

The State Department is expected to provide such exemptions before the full brunt of US sanctions pressure begins on 5 November, even though the scope of waivers is yet undetermined.

China, India and Turkey were among the largest buyers of Iranian crude before the US withdrew from the Iran nuclear deal. US sanctions explicitly exclude exports of natural gas from Iran to its neighbors, but lack of guidance from Washington has created uncertainty for natural gas importers in Turkey and Iraq.

Iranian oil exports have fallen faster and by a greater amount than initially expected, as refiners in Asia-Pacific and Europe curbed their purchases, despite opposition from some of their governments.

"You already see reduction in purchases in countries like China, that you would not have expected, countries that are still in the nuclear deal," Bolton said. "European businesses are fleeing the Iranian market. Most of the big ones are already out."

Argus estimates that Iranian crude loadings fell to 1.58mn b/d in September, down by 12pc since August. But these figures do not include vessels belonging to Iran's state-owned NITC, which have stopped transmitting GPS transponder signals. Iran's exports averaged 2.5mn b/d in January-May.

Trump's decision to reimpose sanctions on Iran has contributed to higher oil prices globally, an analysis by the US Energy Information Administration (EIA) shows. But Bolton today downplayed the effect on oil markets.

"One of the things this administration has done that (former president Barack Obama's) administration did not do was to encourage producers to alter their production to make up for the lost output in Iran," Bolton said. "It has been an interesting exercise, but we have been able in some cases to find alternative purchases for the buyers of Iranian oil," he said, without providing details.

Russia and Saudi Arabia increased production since June. Opec and its non-Opec allies will produce as much as necessary to meet global demand and offset any supply disruptions, Saudi oil minister Khalid al-Falih says.

Growing US output and a lower oil import bill have enabled the administration to implement stricter restrictions than were imposed between June 2012 and January 2016 under Obama. These factors also influenced the layout of sanctions in the run-up to 5 November.

"It is important to remember the context in which the Obama administration negotiated (sanctions exemptions) in 2012," given oil prices above USD 100/bl amid a presidential re-election campaign, said Richard Goldberg, a former congressional aide who helped craft Iran sanctions legislation.

"Their strategy was to announce exemptions early to show that the US was willing to provide exemptions and demonstrate that other countries are reducing purchases from Iran," said Goldberg, a senior fellow at the Washington-based advocacy group Foundation for Defense of Democracies, which backs the administration's Iran policy.

By contrast, Trump's administration—partly as a negotiating tool—has kept the scope of waivers unclear, even as the sanctions deadline approaches. It also has yet to clarify the scope of possible financial sanctions and to explicitly exclude condensate from US sanctions.

"Ultimately the Iranians are evaluating what is going to happen on 5 November, how sanctions will be enforced" and what concessions on financial sanctions the EU has managed to extract from Washington, Goldberg said.

Forcing Iranian exports to zero remains the primary objective, Bolton said. "The president said unmistakably our goal is maximum pressure. There has to be a fundamental change in the behavior of the Iranian regime."

Photo Credit: IRNA