Israel Matzav

The first country to seek a waiver from the new US sanctions on Iran

So who's the first country that's going to seek a waiver from the Obama administration to continue dealing with Iran? No, it's not China, although they're laying the groundwork: China has cut its oil purchases by half as compared with 2011 levels in what will probably become a bid to get the Obama administration to exempt them from the sanctions under the 'significantly reduced dealings with Iran' clause. I'm talking about a country that has actually increased its dealings with Iran over the last several years, and wants to at least keep them on the same level. I'm talking Turkey (Hat Tip: Joshua I).

Turkey will seek a waiver from the United States to exempt its biggest refiner TÜPRAŞ from new U.S. sanctions on institutions that deal with Iran's central bank, a Turkish energy ministry official told Reuters today.

U.S. President Barack Obama signed the new sanctions into law on New Year's Eve, which if implemented fully would prevent most refineries from paying for Iranian crude, the first Western measure that could have serious impact on Iran's oil industry.

The law would strip any financial institution dealing with Iran's central bank from access to the U.S. financial system.

However, the law allows Obama to issue waivers to firms in countries that significantly reduce dealings with Iran, or at any time when it is either in the U.S. national interest or necessary for energy market stability.

U.S. officials have said they will discuss with allies how to implement the law without causing havoc in oil markets.

U.S. ally Turkey gets about 30 percent of its oil from neighbour Iran, and TÜPRAŞ - Turkey's biggest crude oil importer, owned by its largest conglomerate, Koç Holding - is a big buyer of Iranian crude.

The energy ministry official, who spoke on condition of anonymity, said a Turkish energy official would meet a representative of the U.S. embassy in Turkey to learn more about the content of the new U.S. law.

NATO member Turkey has deepened economic and financial ties with Iran in recent years, despite Western efforts to isolate Tehran under sanctions aimed at forcing it to stop work on its nuclear activities.

I don't think that Turkey qualifies for a waiver under any of those provisions, but the only thing that might stop Obama from issuing one is the fact that this is an election year and the Republicans will pound him for it.

What could go wrong?

Labels: Barack Hussein Obama, Iran sanctions regime, Recep Tayyip Erdogan, Turkey

posted by Carl in Jerusalem @ 10:45 PM