A blow? Iranian President Mahmoud Ahmadinejad
Photo: AP
Relentless. US President Barack Obama
Photo: AP
3 major oil companies cut Iranian ties
Financial Times report suggests US pressure on firms providing Tehran with refined oil products proves fruitful
WASHINGTON – Three of the world's largest oil suppliers have clandestinely cut their ties with Iran,
the Financial Times reported Monday.
Iran is one of the world's largest crude oil exporters, but it has to import refined oil products. Vitol, Glencore and Trafigura supply Iran with 50% of its refined oil needs – some 130,000 barrels a day.
The move, which saw Holland-based Vitol and Switzerland's Glencore and Trafigura cease all trading with Iran, stresses the United States' success in pressuring global companies to cut commercial ties with the Islamic Republic.
Analysis
Amnon Meranda
Senior Military Intelligence officer tells Knesset's Foreign Affairs and Defense Committee that applying international sanctions against Islamic Republic may take months, prove only partially effective
The trio's decision will hurt Iran's oil imports, but it will not stop them altogether, as Dubai and several small Chinese companies still have strong oil ties with Tehran.
According to the report, the three's decision was prompted be concerns that their commercial ties with the US and its allies may suffer should they continue trading with Iran; despite the fact that the current draft of suggested international sanction on Tehran does not include oil trade.
American companies are forbidden to trade with the Islamic Republic by law.
Other European companies which export refined oil to Iran are also under pressure to terminate their contracts.
Iran is reportedly developing a greater dependency on Chinese oil products, which currently make up one-third of its refined oil supplies.
Washington is currently pushing legislation which will impose financial sanctions on any insurance company offering marine insurance to Iran-bound oil products. Sans insurance, marine shipping to Iran will become exponentially expensive.
AFP contributed to this report
