June 28, 2024 | Flash Brief

U.S. Sanctions Transporters of Iranian Petroleum

June 28, 2024 | Flash Brief

U.S. Sanctions Transporters of Iranian Petroleum

Latest Developments

The United States sanctioned on June 27 three United Arab Emirates companies and 11 associated vessels that play a role in transporting Iranian petroleum or petrochemical products. Secretary of State Antony Blinken said in a press statement that the sanctions come in response to steps taken by Iran “to further expand its nuclear program in ways that have no credible peaceful purpose.” This announcement follows another enforcement action announced on June 25 by the U.S. Department of the Treasury, which targeted a financial network benefitting Iran’s military.

The three sanctioned UAE companies are Sea Route Ship Management FZE, Almanac Ship Management LLC, and Al Anchor Ship Management FZE, while the 11 sanctioned vessels are named the Astra, Baltic Horizon, Nile, Yamuna, Berenice Pride, Harmony, Euro Viking, Euro Fortune, Arabian Energy, Parine, and Road. Washington sanctioned them pursuant to Executive Order 13846, issued in August 2018, which reimposes key sanctions on Iran, including the country’s petroleum and petrochemical sectors.

Expert Analysis

“Under Biden’s watch, Iran has exported more than $150 billion of oil and petrochemical products. Tehran has used the legal and financial infrastructure of the UAE, among other nations, to facilitate and disguise this illicit trade. The next administration should make it clear to all our allies and partners that we expect them to clean house, and they have to choose between trading with Washington or Tehran. Both cannot happen.” — Saeed Ghasseminejad, Senior Iran and Financial Economics Advisor for FDD

“Iran’s illicit oil trade has thrived under the Biden administration’s lax sanctions enforcement. This week’s announcements in response to Tehran’s escalating nuclear program are positive and long-overdue steps. But depriving the regime in Iran of the resources it uses to fund its malign activities and disrupting its lucrative petroleum and petrochemical trade will require a much more sustained enforcement campaign.” — Nick Stewart, Senior Director of Government Relations for FDD Action

UAE Continues to Export Petrochemical Products

The United States sanctioned Iran’s entire petrochemical sector in November 2018 as part of the Trump administration’s maximum pressure campaign against the clerical regime. Since then, the UAE has served as a key facilitator of sanctions evasion, exporting billions of dollars in petrochemical products. In 2023, the UAE was the world’s third-largest recipient of Iranian oil, with 20 million barrels worth around $1.5 billion passing through the country. These transactions reflect the importance of Iran’s petrochemical sector to the regime’s financial survival. The UAE constitutes a major financial and re-export hub for Tehran.

Iran’s Nuclear Escalations

The fresh sanctions aim to retaliate for Iran’s latest nuclear advances. A new analysis by David Albright, president of the Institute for Science and International Security, projects Iran will massively increase its ability to produce weapons-grade uranium (WGU) at the heavily fortified Fordow enrichment plant. The International Atomic Energy Agency reported on June 13 that Iran is installing nearly 1,400 new advanced uranium-enriching centrifuges at Fordow. Albright’s estimate, detailed in a Washington Post article, indicates that when complete, Fordow’s enrichment capacity will increase by 360 percent, enabling Tehran to produce WGU for up to five nuclear weapons in a single month.

Iran to Significantly Increase Nuclear Enrichment Plant’s Breakout Capability,” FDD Flash Brief

Interim Iranian President Brags About Oil Production,” FDD Flash Brief

90-Day Clock For Iran Sanctions Begins Pursuant to New U.S. Laws,” FDD Flash Brief

Iran’s Oil Exports Continue to Rise,” by Saeed Ghasseminejad

Issues:

Gulf States Iran Iran Sanctions Military and Political Power Sanctions and Illicit Finance