U.S. extends Iran oil sanctions waivers to China, India, South Korea

WASHINGTON Fri Nov 29, 2013 3:54pm EST

U.S. Secretary of State John Kerry waves before getting into his motorcade vehicle as he arrives at Andrews Air Force Base, Maryland, November 25, 2013, as he returns from London. REUTERS/Carolyn Kaster/Pool

U.S. Secretary of State John Kerry waves before getting into his motorcade vehicle as he arrives at Andrews Air Force Base, Maryland, November 25, 2013, as he returns from London.

Credit: Reuters/Carolyn Kaster/Pool

WASHINGTON (Reuters) - The U.S. State Department extended six-month Iran sanctions waivers on Friday to China, India, South Korea and other countries in exchange for their reducing purchases of Iranian crude oil earlier this year.

The waivers had been expected. Under a law governing sanctions imposed on Iran's disputed nuclear program by the United States, the State Department is required to determine whether the Islamic Republic's oil consumers have reduced their purchases.

The decision comes even after the United States and five other global powers, known as the P5+1, agreed in Geneva this month to ease Iran's access to about $4.2 billion in foreign currency reserves for six months in exchange for Tehran's taking steps to curb its nuclear program.

The waivers, which the State Department calls exceptions, mean that banks in the consuming countries will not face being cut off from the U.S. financial system for the next six months.

"We will continue to aggressively enforce our sanctions over the next six months, as we work to determine whether there is a comprehensive solution that gives us confidence that the Iranian nuclear program is for exclusively peaceful purposes," Secretary of State John Kerry said in a statement.

Since the beginning of the sanctions regime in 2012, all 20 of Iran's oil customers have qualified for the periodic waivers. But despite the Geneva agreement, the United States reserves the right to sanction any oil consuming country should it suddenly increase its purchases.

Officials from the Departments of State, Treasury and Commerce have worked with Iran's buyers since 2012 in an effort to find alternative sources of crude, including oil from Saudi Arabia.

Under the Geneva accord, the P5+1 agreed to pause efforts to further reduce Iran's crude oil sales, allowing consuming countries to continue buying their "current average amounts of crude oil." The interim agreement is meant to build confidence for a final agreement on the nuclear program.

Under that agreement, Iran's oil exports will be held to about 1 million barrels per day, the level its sales have averaged this year. Iran's oil shipments were about 2.5 million bpd in the beginning of 2012, before U.S. and European sanctions took effect. The U.S. sanctions law could have driven Iran's oil sales even lower if Iran and the P5+1 did not come to agreement in Geneva.

The State Department said Turkey and Taiwan also qualified for the waivers. Malaysia, South Africa, Singapore and Sri Lanka, which no longer purchase oil from Iran, also qualified for the exceptions.

(Reporting by Timothy Gardner; editing by Ros Krasny, Sandra Maler and Jim Marshall)

We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/
Comments (18)
no.more.lies wrote:
Oh, and by the way, Reuters is obviously a zionist organization. It’s propaganda, not news. Read everything with a critical mind.

Nov 29, 2013 5:19pm EST  --  Report as abuse
no.more.lies wrote:
Oh, and I hope this goes without saying, but using violence is not the way to do that. Violence only generates more violence. Peaceful resistance is much more effective and moral.

Nov 29, 2013 5:23pm EST  --  Report as abuse
gotham1883 wrote:
Granting waivers to those who were undercutting those sanctions by going outside the US/Euro banking system. Sounds to me like they are admitting those sanctions failed and were actually putting in danger that house of cards the banks have built with currency printing. Let’s see if it pulls Iran back into the system, or Iran flips them the bird and continues with its barter economy and expands it with other countries.

Nov 29, 2013 6:48pm EST  --  Report as abuse
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

Track China's Leaders