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September 23, 2009
Oh, joy: China supplying refined gasoline to Iran
Rick Moran
The milquetoast sanctions on Iran imposed by the UN Security Council several years back have barely made a dent in the Iranian economy. Most of them target the Iranian clerical leadership and the Revolutionary Guards.
But the next round of sanctions that have been discussed even before Obama became president was a cutoff of imported gasoline to the Iranians. The regime imports about 40% of its fuel needs and it was thought that this was one sanction that could deliver some bite - if China and Russia could be persuaded to hop on board.
Alas, it apparently is not to be. According to this wire report by Reuters appearing in the New York Times, China has been surreptitiously supplying Iran with up to 25% of its fuel needs using the spot market and third parties to undermine the US sanctions efforts:
The United States and its European allies may target Iran's fuel imports if it refuses to enter talks over its disputed nuclear programme by the end of this month.
Iran's oil minister said last week the country was ready for any fuel sanctions and had signed deals with other countries to purchase more gasoline.
Traders and bankers familiar with Iran's purchasing told the British business daily China had already started supplying the country through intermediaries.
"We estimate, based on what we are hearing in the market, that 30,000-40,000 barrels a day of Chinese petrol is making its way from the Asian spot market to Iran via third parties," the newspaper quoted Lawrence Eagles, head of commodities research at JPMorgan, as saying.
Trader said the sales were legal as fuel imports are not yet included in sanctions against Tehran.
Oil traders told Reuters in late August Iran's imports were likely to be steady at around 128,000 barrels per day in September.
Russia and China, of course, have veto power in the Security Council and can derail any further attempt to impose sanctions on Iran. It would appear that the Chinese at least, would use their veto on any sanctions that included the importation of gasoline into Iran.
Disappointing - but not unexpected. And with the administration hinting that one reason they pulled the deployment of missile defense in Europe was to get the Russians on board at the UN for another round of sanctions against Iran, it wouldn't surprise anyone of the Russians give Obama the finger also.
Isn't it nice to have a "smart" foreign policy again?
Hat Tip: Ed Lasky
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