Turkey: US going too far in pushing states to buy oil from its allies

Turkish Foreign Minister Mevlut Cavusoglu said Monday that it is ethically “wrong” for the US to suggest Saudi Arabia and the United Arab Emirates (UAE) as alternative oil sellers because Washington has close ties with the pair.

The comments came hours after the White House threatened the buyers of Iranian oil with sanctions if they fail to stop their purchases by May 1, ending six months of waivers which allowed Tehran’s eight largest customers to continue importing limited volumes.

It further said that the decision is meant to “bring Iran’s oil exports to zero” and deny the government “its principal source of revenue.”

Speaking at a press conference, US Secretary of State Mike Pompeo claimed that Saudi Arabia and the UAE had agreed to “ensure an appropriate supply (of oil) for the markets” in order to make up for the loss of Iranian oil in the global market.

In response, Cavusoglu said, “Pushing (us) to buy oil from countries other than Iran is going too far.”

“This violates the regulations of the World Trade Organization (WTO) and poses a risk to stability in the region,” he added.
The top Turkish diplomat had, earlier in the day, complained that the US move would “harm Iranian people” instead of serving “regional peace and stability.”
“Turkey rejects unilateral sanctions and impositions on how to conduct relations with neighbors,” he tweeted.

Iran has said it considers no value and credit for US sanctions waivers and is in touch with its foreign partners, including Europeans and neighbors, to counter any adverse consequences of the US bans, which were reimposed on Iran last year after Washington abandoned the 2015 multilateral nuclear deal.

The latest US measure against Iran sent oil prices to new highs.

The international Brent crude oil benchmark rose to more than $74 a barrel in trading on Monday, the highest since November 2018.

Sara Vakhshouri, a consultant at SVB Energy International, a Washington-based global strategic energy-consulting firm, said a “zero export policy” would have “significant consequences on the oil market and prices.”

Britain’s Barclays bank said in a note that the US move would “lead to a significant tightening of oil markets.”

Washington’s goal to cut Iran oil exports to “zero” posed a “material upside risk to our current $70 per barrel average price forecast for Brent this year, compared with the year-to-date average of $65 per barrel," it noted.

Analysts believe that the ongoing conflicts in Venezuela and Libya could also lead to a major spike in oil prices.

They also predict that the Trump administration will not succeed in its goal of cutting Iranian exports to “zero” as the Islamic Republic has many ways to circumvent sanctions.