Sanction on Iranian Exports to Raise American Crude Oil Prices Further
- 06-Mar-2023 4:51 PM
- Journalist: Kim Chul Son
Crude Oil prices in the US market steadily increase due to two global sanctions. First, the sanctions on Russia by the EU put pressure on the US to increase exports to meet Europe's demand. Since there is already news published on the Russian sanctions and their impact on Crude Oil prices on the ChemAnalyst portal. Let us discuss the second sanction on Iran imposed by the US as a warning against their nuclear activities.
As Iran moves on with its nuclear program, US authorities are once more focusing on strengthening the enforcement of sanctions on Iran's Crude Oil and petrochemicals sales. On March 2, they took action against six companies and 20 vessels that have helped Iran export energy. Conversely, Washington "remains highly skeptical on the possibilities for a wider deal," according to the experts. "However, Biden's American team in Iran is optimistic that more stringent sanctions enforcement and several confidence-building measures (such as the prisoner deal) will result in a non-binding agreement this summer to halt Iran's nuclear activities and lessen the likelihood of an Israeli military strike. However, any such agreement would maintain Crude Oil sanctions."
This new sanction imposed on March 2nd bans several Asian-based Crude oil and Gas firms from transporting Iranian petroleum goods to the US market. If the prisoner swap between the US and Iran is accomplished this month, an agreement this summer in which Iran agrees to freeze uranium enrichment at 60% in exchange for the US unfreezing some Iranian assets may be feasible. Moreover, if all works out, the Biden administration "may revert to the sanctions enforcement climate of laxity that prevailed in 2021–22, but a formal lifting of Crude oil restrictions is not on the table.
According to ChemAnalyst, the cost of Crude Oil in the US market is likely to continue at least till the end of summer 2023 as both sanctions pressurizing the Crude oil prices are unlikely to be lifted in the near future.
