US grants eight countries Iran oil sanctions waivers

US grants eight countries Iran oil sanctions waivers
2 min read
02 November, 2018
US sanctions targeting the Iran's oil sector take effect on Monday and Trump administration officials have said they intend to reduce the country's exports to zero.
Sanctions on Iran's oil sector take effect on Monday [Getty]

The United States will allow eight countries to continue importing Iranian oil but only at much lower levels after the reimposition of sanctions on Monday, Secretary of State Mike Pompeo said on Friday.

The US Treasury will also demand the SWIFT global financial network stop servicing Iran's banking industry as part of enforcing sanctions over the country's nuclear program and alleged support for terrorism.

Another 700 companies, individuals, businesses, aircraft and ships will be added to the US sanctions list, widely expanding the people and entities Washington seeks to block from accessing global business and financial networks.

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."

Turkey, Japan, South Korea, India and China are believed to be among those exempt, though the waivers are only temporary on the basis the countries eventually end imports entirely, Pompeo said.

The annoucement comes as the US is preparing to impose sanctions on Iran's energy, financial and shipping sectors, the second batch of penalties after President Donald Trump withdrew in May from a landmark nuclear deal with other world powers.

Read more: Trump's march to war with Iran

However, the countries granted the waivers can only import oil at restricted levels. Iran's oil exports have already plummeted in recent weeks from an average of more than 2.5 million barrels per day to around 1.5 million as sanctions loomed.

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.

Responding to reports the waivers were impending, Iran said on Friday it showed that the market needed the country's crude.

"The waivers granted to these eight countries show that the market needs Iran's oil and it cannot be pulled out of the market ... I don't know whether these waivers are permanent or temporary," state TV quoted Iran's Deputy Oil Minister Ali Kardor as saying.

Trump's intention to reduce the country's exports to zero has somewhat backfired with oil prices steadily increasing, including gasoline, ahead of mid-term elections in the US.