US President Joe Biden’s administration is weighing fresh sanctions targeting Iranian crude oil sales to China if Tehran hinders ongoing talks aimed at reviving the 2015 nuclear deal, a report said Monday.
While no decision has been made and other options are on the table, Washington could target the shipping networks through which Iran is currently exporting an estimated one million barrels a day and thus deny the Islamic Republic critical revenue, the Wall Street Journal reported, citing unnamed US officials and “people familiar with the matter.”
Iran’s oil exports have increased since Biden took office in January, and China is its biggest client, according to US-based oil-shipping tracker TankerTrackers.com Inc.
“There is not much left to sanction in Iran’s economy. Iran’s oil sales to China is the prize,” one of the US officials was quoted as saying.
The plan would also involve “the aggressive enforcement of current sanctions already banning dealings with Iran’s oil and shipping industry through new designations or legal actions,” the report said.
However, it added that administration officials were concerned that tightening the sanctions could backfire and drive Tehran to accelerate its nuclear program.
Alternative measures being weighed, according to the report, include a “diplomatic campaign to persuade China, India and other major crude oil buyers to cut imports of the commodity, non-oil trades, debt financing and financial transfers.”
Iran and the US have been holding indirect talks in Vienna since April over a joint return to the Joint Comprehensive Plan of Action, which granted Tehran sanctions relief in exchange for significant curbs on its nuclear program.
Former US president Donald Trump withdrew from the agreement in 2018 and reimposed crippling sanctions against Iran, which led the Islamic Republic to step up uranium enrichment to its highest-ever levels in violation of the accord.
The sixth round of talks adjourned in late June, and while the Biden administration has expressed interest in returning to the negotiation table, US officials have voiced increasing pessimism regarding the chances for an agreement.
On Saturday, Iran’s deputy foreign minister said the negotiations would not resume until hardline President-elect Ebrahim Raisi is sworn in next month.
“We’re in a transition period as a democratic transfer of power is underway in our capital,” Abbas Araghchi wrote on Twitter. “Vienna talks must thus obviously await our new administration.”
Analysts have speculated that an agreement between the US and Iran would be more likely during the ongoing lame-duck period, while outgoing President Hassan Rouhani is still in power and before the inauguration of Raisi — a longtime proponent of his country’s nuclear program. It was Rouhani’s administration that negotiated the multilateral agreement with former US president Barack Obama in 2015.
The nuclear deal, which saw Iran gain relief from those crushing sanctions, limited Tehran’s program to enriching only up to 3.67 percent — enough to power a civilian nuclear reactor. It now enriches a small amount of uranium up to 60%, a short step from weapons-grade levels.
AP contributed to this report.