May 20, 2019 – On May 12, Afghanistan halted imports of all Iranian petroleum products including kerosene and fuel oil, Hamid Hosseini, the spokesman for the Iranian Oil, Gas, and Petrochemical Products Exporters’ Associations said. Mr. Hosseini added that Iraq had also reduced its imports of Iranian petroleum products significantly.
In early May, the U.S. ended sanctions exemptions on Iranian oil imports for India, Italy, Greece, Taiwan, Turkey, Japan, South Korea, and China. Washington hopes to reduce Iran’s oil exports to zero and deprive the Islamic Republic regime of its primary source of revenue. In the past, some countries have, however, circumvented U.S. sanctions and bought Iranian oil.
The Reuters news agency reported on March 20: “Iran evaded the U.S. sanctions on petroleum exports by using ship-to-ship transfers involving four different ships, and by using forged documents that masked the fuel oil as originating from Iraq.”
Nearly two months later on May 16, Reuters reported on another incident in which “a tanker carrying Iranian fuel oil in violation of U.S. sanctions unloaded its cargo into storage tanks near the Chinese city of Zhoushan, discharging nearly 130,000 tons of Iranian fuel oil onboard the tanker.”
Citing an informed source, Reuters added: “Iran is not exporting oil to Europe any longer. It ships most of its oil to India and China.” The Chinese government has, however, denied the reports, insisting it has purchased no oil from Iran in four years.
In an interview with Mehr News Agency, Fereydoun Barkeshli, the president of the Vienna Energy Research Group, said: “Iran had devised effective mechanisms to bypass previous sanctions. However, Tehran disclosed all those methods after the 2015 Joint Comprehensive Plan of Action (JCPOA), better known as the Iran nuclear deal. So the U.S. is aware of every way that Iran can dodge sanctions and sell its oil.”
Back in October 2018, Ahmad Amirabadi Farahani, a Majlis (Iranian Parliament) deputy representing Qom, said: “The U.S. has penalized those who bypassed the sanctions. We must find out how the enemy discovered the identity of these people and investigate these cases thoroughly.”
It is also becoming increasingly difficult for Iran to sell its oil even to its three neighbors: Turkey, Afghanistan, and Iraq. Tehran has felt the impact of severe U.S. economic sanctions. The country’s oil exports fell to 500,000 barrels per day (bpd) in May, showing a 50 percent drop in less than a month. In contrast, Iran shipped 2.5 million bpd in April 2018, a month before President Donald Trump withdrew the U.S. from the JCPOA.
The government’s 2019-20 budget predicted $5.7 billion in oil revenue. It is abundantly clear that the government will not meet its target. The budget deficit will exceed the previous forecast of $11 billion, which will have a severe impact on the lives of ordinary Iranians.
[Translated from Persian by Fardine Hamidi]