Returning from the United Nations General Assembly in New York, Turkish President Tayyip Erdogan told reporters Friday that it remains "impossible" for Turkey to halt its oil and gas purchases from Iran in conformity to US sanctions. He affirmed commitment to continuing to buy oil and gas from Iran despite US threats, with no plans to halt or even reduce imports in the future.
He said further he was "not afraid" of possible US sanctions over continued dealings with Tehran, Reuters reported. This as the Trump administration has gone after Chinese shipping companies this week over alleged sanctions busting activity related to Iranian oil imports to China and other east Asian ports.
Image via Fars News
No doubt Erdogan has to be taking note of the lengths to which Washington is prepared to go, which included rattling the global shipping industry this week by sanctioning Chinese firms China Concord Petroleum Co., Kunlun Shipping Co., Pegasus 88 Ltd., and COSCO Shipping Tanker (Dalian) Seaman & Ship Management Co, in its long-haul campaign to see Iranian oil exports go to "zero".
Turkey has long been exclusively reliant on imports to meet the growing energy needs of its 80 million citizens.
Turkish media sources note that even the country's electrical grid is heavily tied to natural gas imports, as "almost 40 percent of its electricity is produced in gas-fired plants."
As Ahval News details further:
Under the terms of long-term supply contracts signed by Ankara and Tehran before the new round of sanctions, Turkey was set to buy 9.5 billion cubic meters of gas over the period up to 2026.
Ankara has from the very beginning of Trump pulling out of the 2015 nuclear deal and imposing sanctions remained defiant, which Turkish officials have consistently framed as a matter of economic survival.
Turkey’s Economy Minister said from the start of the first round of Washington's Iran sanctions following the JCPOA pullout that US dictates on Iran "are not binding for us" and further that "we will only follow our own national interests."
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By Zerohedge.com
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China, India, Turkey and the EU between them account for 86% of Iranian oil exports. Even Japan and South Korea the closest US allies are still buying small volumes of Iranian crude despite US sanctions.
The failure of US sanctions against Iran gives some credence to the claim by Iranian President Rouhani that the US offered lifting the sanctions on his country in exchange for negotiations to end the crisis between them. The offer was reportedly made by the UK, France and Germany on behalf of the United States. And while the Trump administration has denied the claim, still there is no smoke without fire.
Dr Mamdouh G Salameh
International Oil Economist
Visiting Professor of Energy Economics at ESCP Europe Business School, London