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Today's Paper | November 21, 2024

Updated 15 May, 2019 05:30pm

Saudi Arabia welcomes US move to end all Iran sanction waivers

Saudi Arabia's foreign minister on Tuesday welcomed a United States decision to end all Iran sanction waivers by May, saying it was a necessary step to halt Tehran's “destabilising” policy in the region.

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 US sanctions on Iranian oil exports.

Eight governments were initially given the six-month reprieve on oil sanctions that had been imposed last year by the US. 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 US demands.

“Saudi Arabia fully supports this step taken by the US as it is necessary to force the Iranian regime to end its policy of destabilising stability and its support and sponsorship of terrorism around the world,” Ibrahim al-Assaf said in comments carried on the Saudi state media.

He reiterated a statement issued by the kingdom's energy minister on Monday that the world's largest oil exporter would coordinate with other oil producers to ensure an adequate crude supply and balanced markets after Washington's announcement.

US sanctions will 'intensify Mideast turmoil': China

China warned on Tuesday that the US decision to impose sanctions on buyers of Iranian oil will “intensify turmoil” in the Middle East and in the international energy market.

“China firmly opposes the US 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 ME and the turmoil in the international energy market.”

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 and 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 tonnes 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 per cent 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 US 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.

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