Beijing says it firmly opposes the U.S. sanctions and the impact they will have on international energy market
China warned on Tuesday that the U.S. decision to impose sanctions on buyers of Iranian oil will “intensify turmoil” in the Middle East and in the international energy market.
The White House announced on Monday it was calling an end to six-month waivers that had exempted several countries—including major importer China—from unilateral U.S. sanctions on Iranian oil exports.
“China firmly opposes the U.S. implementation of unilateral sanctions and its so-called long-armed jurisdiction,” foreign ministry spokesman Geng Shuang said at a regular press briefing. “The relevant move by the United States will intensify the turmoil in the Middle East and the turmoil in the international energy market.”
In seeking to reduce Iran’s oil exports to zero, the Trump administration is targeting the country’s top revenue earner in its latest no-holds-barred move to crush the economy and scale back the clerical regime’s influence.
Eight governments were initially given the six-month reprieve on oil sanctions that had been imposed last year by the United States. The exemption will now end on May 2.
Greece, Italy, Japan, South Korea and Taiwan have already ended or heavily reduced their purchases from Iran. The other three are China, India and Turkey, with Ankara vowing to defy the U.S. demands.
For its part, China will “continue to work in order to safeguard the lawful and legitimate rights of Chinese companies,” Geng said.
Japan’s Cabinet Secretary Yoshihide Suga told reporters that Tokyo hopes to “exchange opinions with related Japanese firms and discuss necessary actions to avoid [negative] impact on energy supply in Japan.”
India’s Petroleum Minister Dharmendra Pradhan posted to Twitter that New Delhi would receive “additional supplies from other major oil producing countries,” adding that refineries were “fully prepared to meet the national demand for petrol, diesel & other Petroleum products.”
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. The country imported 2.4 million tons of condensate from Iran in the first quarter of this year according to the Korea Petrochemical Industry Association (KPIA), an umbrella industry group, more than 30 percent of its total purchases.
Iranian condensate is cheaper than others and has the “best quality,” a spokesman for Hanwha Total, one of South Korea’s major petrochemical firms, told AFP. “We now have to look for the second-best instead,” he said.
Different regions produce different mixes of hydrocarbons, added KPIA researcher Choi Hong-jun, so that users’ factory equipment is “best suited to processing Iranian condensate. It will cost extra just to adjust it.”
South Korean experts said the U.S. withdrawal of waivers was long anticipated and companies had prepared back-up plans involving diversified import options including Qatar and Australia. “There will be limited impact,” said a trade ministry official in Seoul.
But despite Washington’s insistence that there will be no more exemptions South Korea’s foreign ministry said it would continue its “utmost efforts” to have the waiver extended.