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PATRICK LAWRENCE: The US Moves on Iran’s Oil Market as an Expression of an Irrational Foreign Policy

PATRICK LAWRENCE: The US Moves on Iran’s Oil Market as an Expression of an Irrational Foreign Policy

Patrick Lawrence gauges the backfiring potential of Pompeo’s withdrawal on Thursday of U.S. sanction waivers from eight major importers. 

A Decisive Defeat in Long-Running Battle with Foreign Policy Minders

Secretary of State Mike Pompeo’s announcement last week that no importer of Iranian oil will henceforth be exempt from U.S. sanctions is as risky as it is misguided. The withdrawal of waivers as of this Thursday effectively gives eight importers dependent on Iranian crude — India, Japan, South Korea, China, Turkey, Taiwan, Italy, and Greece — 10 days’ notice to adjust their petroleum purchases. This is now a full-court press: The intent is to cut off Iran’s access to any oil market anywhere as part of the administration’s “maximum pressure” campaign against Tehran. “We are going to zero,” Pompeo said as he disclosed the new policy.

Nobody is going to zero. The administration’s move will further damage the Iranian economy, certainly, but few outside the administration think it is possible to isolate Iran as comprehensively as Pompeo seems to expect. Turkey immediately rejected “unilateral sanctions and impositions on how to conduct relations with neighbors,” as Foreign Minister Mevlüt Çavusoglu put it in a Twitter message. China could do the same, if less bluntly. Other oil importers are likely to consider barter deals, local-currency transactions, and similar “workarounds.” In the immediate neighborhood, Iraq is so far ignoring U.S. demands that it cease purchasing natural gas and electricity from Iran.

Pompeo joining an Iranian diaspora meeting in Dallas, April 15, 2019. (State Department/Ron Przysucha via Flickr)

Pompeo joining an Iranian diaspora meeting in Dallas, April 15, 2019. (State Department/Ron Przysucha via Flickr)

Insights on Overreach

There are a couple of insights to be gleaned from this unusually aggressive case of policy overreach.

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