Washington: US President Donald Trump has defended his decision to spare India and seven other major importers of Iranian oil from immediate penalties, saying it was done to keep the global oil prices down and avoid causing a “shock” to the market.
The US on Monday reimposed all penalties that had been lifted as part of the 2015 Iranian nuclear deal as the Trump administration added nearly 700 targets, including 50 Iranian financial institutions, to a sanctions list.
“We have the toughest sanctions ever imposed. But on oil, we want to go a little bit slow because I don’t want to drive the oil prices in the world up,” Trump told reporters at Joint Base Andrews outside Washington on Monday before leaving on a campaign trail for the mid-term polls.
He, however, emphasised that his effort to keep the oil prices down has nothing to do with Iran.
When asked about his decision to give temporary exemptions to eight countries from the ban on Iranian oil imports, Trump said, “I’m not looking to be a great hero and bring it down to zero immediately. I could get the Iran oil down to zero immediately, but it would cause a shock to the market. I don’t want to lift oil prices.”
“If you notice, oil prices are going down very substantially, despite the fact that already half of their capacity is gone. But I don’t want to do that,” he said.
“I saw some people saying, ‘Oh, why aren’t you tougher on that?’ Well, the sanctions are very tough and I don’t want to lift the oil prices worldwide by clamping down 100 per cent. It will be gradual,” the US president said.
However, the Democratic Party leadership criticized Trump for giving exemptions to some of the major Iranian oil importers.
House Democratic Whip Steny H Hoyer said, “Rather than achieving its stated goal of eliminating Iran’s oil exports altogether, the administration has issued ‘exemptions’ for major Iranian oil importers, allowing Iran to earn billions of dollars from oil sale.”
“These exemptions are premised on significant reductions of Iranian oil imports by countries such as China and Turkey when there is minimal evidence of such reductions. This waters down the integrity of sanctions and communicates to the rest of the world that others do not have to abide by the US restrictions,” he said.
China is the single-largest importer of Iranian oil and forcing it to look elsewhere to fuel its dynamic economy would likely have rocked the market. For some waiver recipients, domestic concerns were paramount. South Korea, for example, is reliant on oil imports to drive its economy. It had been consultation with the Trump administration since the US pullout from the Iran nuclear deal in May. Seoul says it will reduce oil imports from Iran by a “significant” amount but the waiver will allow it to maintain a stable supply of a light form of crude known as condensate.
Seeking to deflect criticism from some Iran hawks concerned that the sanctions don’t go far enough, Pompeo stressed that US pressure on countries to stop buying Iranian oil had already reduced its exports by more than a million barrels of crude per day costing the country $2.5 billion revenue. Some leading Iran hawks appeared to agree with the administration’s approach. “We are encouraged that these waivers will only be temporary and one-time,” said United Against a Nuclear Iran, a prominent group that was harshly critical of the nuclear deal and the sanctions relief it brought.
In addition to the oil exemptions, Pompeo said limited waivers had been issued to allow European and other firms to continue conversion work on three of Iran’s nuclear facilities. “Permitting these specific activities to continue is an interim measure that preserves oversight of Iran’s civil nuclear program,” the State Department said. “This oversight enhances our ability to constrain Iran’s program and keep the pressure on the regime while we pursue a new, stronger deal.”