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EghtesadOnline: The recent announcement by the United States that all Iran oil sanctions waivers will terminate by May has drawn the strong objection of Turkey and China, two of the biggest importers of Iranian oil.

The US placed sanctions on Iran's oil sector after withdrawing from the 2015 nuclear deal last year, but granted temporary waivers to eight countries, namely China, India, Turkey, Japan, South Korea, Italy, Greece and Taiwan. 

The White House announced on Monday that it would not reissue waivers when they expire on May 2, aiming for the target of bringing Iran’s oil exports to zero. 

Italy, Greece and Taiwan had already cut their imports, but the other five still rely on Iranian crude, Financial Tribune reported.

China, Iran’s largest crude oil customer, censured the move, warning of instability in the region and in the oil market. 

“The decision from the US will contribute to volatility in the Middle East and in the international energy market. We urge the United States to take a responsible attitude and play a constructive role, not the opposite,” Chinese Foreign Ministry Spokesman Geng Shuang said on Tuesday, Reuters reported. 

He told a daily news briefing that China is strongly opposed to Washington's enforcing of unilateral sanctions, or “long-armed jurisdiction”. 

The “normal” energy cooperation China and other countries have with Iran within the framework of international law is lawful and reasonable, and should be respected, he added.

“China has already lodged representations with the US side about this," he said, adding that the Chinese government will continue to work to protect the legitimate rights of Chinese firms.

Turkey also criticized US President Donald Trump's decision, saying the measure would not bring peace and security to the region. 

"The #US decision to end sanctions waivers on #Iran oil imports will not serve regional peace and stability, yet will harm Iranian people," Foreign Minister Mevlut Cavusoglu wrote on Twitter after the announcement. 

"#Turkey rejects unilateral sanctions and impositions on how to conduct relations with neighbors," he added. 

The White House statement also notified that the US, Saudi Arabia and the UAE, along with their allies, "are committed to ensuring that global oil markets remain adequately supplied".

Cavusoglu said in a press conference in Ankara that pushing his country to buy oil from countries other than Iran "is going too far", Daily Sabah reported.  

He described it as ethically "wrong" to suggest alternatives that the US has close ties with. 

"This violates the regulations of the World Trade Organization and poses a risk to stability in the region," he added.

 

 

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India, the world’s third-biggest oil importer, has announced that it will get additional supplies from other major oil producing countries to compensate for the loss of Iranian oil. 

“Indian refineries are fully prepared to meet the national demand for petrol, diesel and other petroleum products,” India’s Petroleum and Natural Gas Minister Dharmendra Pradhan said on Tuesday.

Indian refineries used to prefer the Iranian crude due to its cost effectiveness, as Tehran offers 60-day credit and free insurance and shipping.

Yet, refiners in India had almost halved their Iranian oil purchases since November when US sanctions went into effect.

South Korea aims to continue its efforts until the May deadline for the extension of exemptions, according to a government statement released after the announcement. 

It is to send a delegation, led by Deputy Foreign Minister for Economic Affairs Yun Kang-hyeon to Washington this week for follow-up talks on the decision, Yonhap reported. 

Refiners in South Korea, which has few natural resources of its own, have relied heavily on Iranian petroleum, especially oil condensate used to produce petrochemical products.

A spokesman for Hanwha Total, one of South Korea's major petrochemical firms, told AFP that Iranian condensate is cheaper than others and has the "best quality". 

He also said that factory equipment is often best suited to processing this material.

"It will cost extra just to adjust it." 

Nevertheless, South Korean experts said the US withdrawal of waivers was long anticipated and companies had prepared backup plans involving diversified import options, including Qatar and Australia.

"There will be limited impact," said a trade ministry official in Seoul.

Japan said on Tuesday that it expects a limited impact from Washington's move. 

Speaking at a regular press conference, Japan’s Trade Minister Hiroshige Seko told reporters the government did not see any need to tap national oil reserves following the US decision.

“We will closely watch international oil markets and exchange views with Japanese companies involved in crude imports and may consider taking necessary measures,” he said, declining to give details.

Japan, the world’s fourth-biggest oil consumer, has been reducing its reliance on Iranian crude supplies. 

“Iran now accounts for about 3% of purchases,” Seko said.

Japanese refineries earlier halted the import of Iranian oil after buying 15.3 million barrels between January and March ahead of the expiry of their sanctions waiver, according to industry sources and data on Refinitiv Eikon.

 

Turkey United States China Iran oil sanctions Iran Oil Waivers Strongly Oppose importers of Iran oil