Growing support for US effort to get Iranian oil exports to zero: Pompeo

Washington (Platts)--8 Nov 2018 254 pm EST/1954 GMT

Secretary of State Mike Pompeo said Thursday there is growing international support for the US campaign to push Iranian oil exports to zero.

"We have an enormous coalition supporting our effort," Pompeo said in a BBC interview. "The crude oil exports from nearly every country in the world have stopped already, even before the sanctions were re-imposed."

The US on Monday reimposed sanctions on Iranian crude exports, while granting temporary waivers to China, India and Turkey -- Iran's top buyers -- as well as Japan, South Korea, Italy, Greece and Taiwan. But the US has maintained its goal of eventually reducing Iranian crude exports to zero while offering little insight into how this may be achieved.

US sanctions are expected to bring Iranian crude exports down to 1.1 million b/d in November, and 850,000 b/d in the fourth quarter of 2019, down from an average of 2.686 million b/d in April and May, according to S&P Global Platts Analytics

Brian Hook, State's special representative for Iran, on Wednesday declined to offer details on these waivers, such as the volume of Iranian exports permitted under each agreement, claiming that they were confidential and individually negotiated.

"In order to be eligible for [a waiver], a country needs to show a significant reduction," Hook said. "And so we are going to be continuing our path to zero [exports]."

Hook said that the waivers were necessary in order to apply "maximum economic pressure" on Iran without increasing oil prices, a top concern among Trump administration officials.

"If we were to increase the price of oil, it would be bad for American consumers, it would be bad for the global economy, and it would give an advantage to Iran," Hook said, claiming that the oil market would have more supply than demand in 2019.

During a press conference Wednesday, President Trump said that he offered the eight countries a "break" on sanctions because: "I don't want to drive oil prices up to $100 a barrel or $150 a barrel, because I'm driving them down."

"If you look at oil prices, they've come down very substantially over the last couple of months," Trump said. "That's because of me. Because you have a monopoly called OPEC."

Hook on Wednesday cautioned against the risk of business with Iranian oil tankers, which he referred to as a "floating liability," during his briefing.

"Should there be an accident involving an Iranian tanker, there is simply no way these Iranian insurance companies can cover the loss," Hook said.

Hook said that up to 12 Iranian tankers have recently turned off their AIS responders and "gone dark," in violation of international maritime law.

"Self-insured Iranian tankers engaging in unsafe behavior with many tons of crude oil onboard is courting environmental and financial disaster," he said. -- Brian Scheid,

-- Meghan Gordon,

-- Edited by Richard Rubin,

Copyright © 2018 S&P Global Platts, a division of S&P Global. All rights reserved.