The Trump administration has stepped up efforts to completely eliminate Iran’s oil export market, announcing Monday the elimination of sanctions exemptions that allowed the rogue nation to continue exporting oil to a select group of nations.
The Trump administration last year granted six-month waivers to eight countries, exempting them from the wide-ranging sanctions implemented as part of the unilateral U.S. withdrawal from the 2015 Iran nuclear deal. The elimination of those exemptions, which Secretary of State Mike Pompeo will officially announce Monday afternoon, will likely devastate the already struggling Iranian economy.
“President Donald J. Trump has decided not to reissue Significant Reduction Exceptions (SREs) when they expire in early May,” the White House said in a statement. “This decision is intended to bring Iran’s oil exports to zero, denying the regime its principal source of revenue.”
Crude futures spiked to six-month highs on news of the move, which is expected to eliminate 1 million barrels per day from the global market beginning May 2.
In response, Iranian officials have threatened to close the Strait of Hormuz, a narrow waterway through which one fifth of the world’s traded oil supply travels.
“If we are prevented from using it, we will close it,”Alireza Tangsiri, head of the Revolutionary Guard Corps navy force, told the state-run Fars news agency. “In the event of any threats, we will not have the slightest hesitation to protect and defend Iran’s waterway.”
China, the largest buyer of Iranian crude, spoke out against the move on Monday.
“China’s cooperation with Iran is open, transparent, reasonable and legitimate, and should be respected,” Foreign Ministry spokesman Geng Shuang told reporters during a regular briefing.