President Biden came under fire…
Oil prices were up early…
Beijing has declined a request by U.S. envoys to stop importing crude oil from Iran, Bloomberg reports, citing unnamed sources in the know. While this is a major setback in President Trump’s quest of cutting Iranian oil exports to zero by November 4, Beijing, according to the sources, agreed to not increase its imports of Iranian crude.
U.S. officials are traveling around the world to persuade allies to suspend imports of Iranian oil ahead of the sanctions, but analysts doubt the push will be completely successful, as Iran’s return on international oil markets provided a very welcome diversity of oil supplies for buyers from Asia to Europe.
Iran, on the other hand, has warned the United States that Tehran would respond with “equal countermeasures” if the United States tries to block Iranian crude oil exports. “If America wants to take a serious step in this direction it will definitely be met with a reaction and equal countermeasures from Iran,” said foreign ministry spokesman Bahram Qassemi in early July.
Also in early July, the remaining signatories to the Joint Comprehensive Plan of Action, often called the Iran nuclear deal, declared their support for Iran in the face of the U.S. pull-out. The UK, France, Germany, Russia, and China assured Tehran that they will continue buying Iranian crude and maintain trade and investment relations despite the return of U.S. sanctions, although analysts are again skeptical that European oil companies will be able to conduct business in Iran after November 4. Indeed, French Total has already announced its withdrawal from the South Pars gas project after the State Department made a note of telling everyone concerned that no sanction waivers would be granted.
Related: Exxon’s Shocking Supply And Demand Predictions
Besides China, Iran’s other top oil client, India, tried to make a stand initially, saying it would not honor Washington’s unilateral sanctions, but later Indian refiners started cutting back the amount of oil they purchase, citing concerns about their continued access to the U.S. financial market.
At the same time, however, Washington has softened its tone, saying that waivers may in fact be granted for some oil-dependent allies that are unable to quickly find a replacement for Iranian crude.
By Irina Slav for Oilprice.com
More Top Reads From Oilprice.com:
Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.