US Media: Obama’s Oil Sanctions Against Iran Aren’t Working?

Iran is now exporting more oil than at any time since mid-2012, raising doubts about how effective that sanctions strategy has been, Foreign Policy said.

“This rise in Iran’s oil exports came while the Obama administration may be betting that sanctions on Iranian oil exports force the country to make concessions over its nuclear program,” the Foreign Policy said in its report.

“According to the revised data released Friday by the International Energy Agency (IEA), Iran’s crude oil exports jumped to 1.65 million barrels per day in February, thanks to increased purchases by China, India, and South Korea,” added the report.

According to Foreign Policy, that is well above the informal cap of about one million barrels per day set by the Obama administration as part of the limited sanctions relief given to Tehran during the six-month interim deal to hold nuclear negotiations.

The IEA said that preliminary data showed that Iran’s oil exports dropped to about one million barrels a day in March, “but that figure will likely be revised upwards closer to February levels upon receipt of more complete data.”

“In other words, Iran’s oil exports appear to have jumped and stayed consistently higher since the announcement late last year of the interim deal,” the Foreign Policy said.

The International Monetary Fund said this month that Iran could post modest economic growth between now and next year.

Elsewhere, the report reminded the statements of EU foreign policy chief Catherine Ashton and Iranian Foreign Minister Mohammed Javad Zarif earlier this year that “a lot of intensive work will be required to overcome the differences” between the two sides, who will meet again next month in Vienna.

State Department Spokesperson Jen Psaki said Friday that the reported amounts of crude oil that Iran sold refers to volume over a six-month period, and that over time the amount will average out to one million barrels.

“Month-to-month variability is normal in oil markets,” Psaki said, “And we still expect and anticipate…that this will average out over a six-month period.”

Since 2012, the US and Europe have sought to hamstring Iran’s economy by limiting the amount of oil it can export.

As part of the interim nuclear deal — and in the teeth of heated opposition in Congress — the US halted further cuts to Iranian exports, but said that Iran could not sell additional volumes of oil while talks continue.

But the latest IEA figures show that China and India, in particular, continue to be large buyers of Iranian oil despite US efforts to get both countries to curb their consumption. The IEA said that China likely imported about 500,000 barrels of Iranian oil a day in the first quarter of 2014, compared with about 430,000 barrels a day last year.

According to the Foreign Policy report, India’s purchases of Iranian oil have also jumped sharply, despite both US diplomatic arm-twisting and Indian pledges to curtail imports.

The IEA said that India’s first-quarter Iranian oil imports were about 340,000 barrels a day compared with just 190,000 barrels a day last year.

“The latest apparent rebound in Iranian oil exports comes as Moscow is challenging the US-led effort to maintain pressure on Iran. Since the beginning of this year, Russia and Iran have reportedly been in talks regarding an oil-for-goods barter deal that could bring Iran as much as $20 billion in exchange for about 500,000 barrels of oil per day,” the Foreign Policy said.

Obama administration officials, including Secretary of State John Kerry and Treasury Secretary Jack Lew, have repeatedly stressed that such a deal, if it were finalized, could trigger US sanctions on Russia.

“Leading lawmakers, including Sens. Robert Menendez (D.-NJ) and Mark Kirk (D.-Ill.), the authors of key sanctions legislation, urged President Barack Obama to “put Iran on notice if it tries to evade limits on energy sales.”

Russian Finance Minister Anton Siluanov has rebuffed those warnings, saying that Russia only acknowledges UN sanctions on Iran, not US restrictions on Iran’s oil exports.