Hawkish advisors trigger Trump’s oil sanctions on Iran

According to three different sources, US President Donald Trump’s unexpected decision to ban Iranian oil purchases after May 1, which ended exemptions for eight countries, came only after hawkish economic and security advisors expressed concern of an oil price hike.

By Sohaila Barghash

The hard-liners of Trump’s National Security Council, are claimed to have played the biggest role in leading to the decision, which fully severed Tehran’s financial lifeline.

For months, National Security Council officials argued for tightening the sanctions over the objections of State Department officials who favoured allowing some countries to continue purchasing Iranian oil.

A senior administration official stated, “No one’s actually tried to take this all the way to zero,” adding that reaching a consensus among all concerned government agencies required “a lot of work.”

However, President Donald Trump has been prone to suffocating Iran’s oil exports since he re-established sanctions on Iran last November for the first time since 2015.

Trump aims to punish Iran’s nuclear ambitions for supporting armed militant groups in the Middle East, although, in the beginning he backed a gradual approach, providing waivers to allies and trading partners such as China, India and Turkey.

Currently, the United States is able to remove about 2 million barrels of oil each day from the world’s supply through its imposition of sanctions on the Iran and Venezuela industries.

Therefore, US oil production now reaches an all-time high of more than 12 million barrels per day, which is predicted to keep global markets well-supplied and ensures low prices.

Before the announcement of Trump’s decision, top economic and security advisors attempted to convince Trump that the time had come to cut off Iranian oil exports completely.

Thereby, resources confirm that the National Security Council played a key role in driving the argument to end the waiver program, led by Richard Goldberg, a new member of the Trump administration and a long-time advocate for confronting Iran.

Trump discussed the matter with Bolton, Treasury Secretary Steve Mnuchin, Energy Secretary Rick Perry as well as Secretary of State Mike Pompeo.

While Bolton and Perry backed ending the waivers, some in Pompeo’s State Department expressed concern about potential rise in oil prices, however, they eventually dropped their objections.

Yet the decision surprised most US allies and Iranian oil buyers, for instance, China’s Foreign Ministry issued a formal complaint to the United States.

Trump has long been anxious that rising oil prices could hurt the economy and raise retail gasoline prices, and even though oil prices struck six-month highs after the announcement, prices have since then eased back gradually.

Trump asked members of the Organization of the Petroleum Exporting Countries to increase the flow of oil to compensate for losses from Iran and Venezuela.

although OPEC production declined by 1.6 million barrels per day between December and March, Saudi Arabia’s energy minister responded by saying he saw no need to raise oil output immediately.

Former US president Barrack Obama’s sanctions program on Iran, ended with an international accord with Tehran reached in 2015 aimed at preventing Iran from getting a nuclear bomb.

Later last year, Trump withdrew the US from the deal over the objections of the other signatories, even though the International nuclear inspectors assured at the time that Iran was abiding by the deal’s terms.

State Department officials claimed it was the Trump administration’s intention from the start to bring Iran’s exports to zero.

Frank Fannon, US Assistant Secretary of State for Energy Resources stated, “We are doing this … in a favourable market condition with full commitment from producing countries. We think this is the right time.”

https://www.globaldailynews.com/world/saudi-bahrain-welcome-us-sanctions-iran-oil/

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