US Sanctions More Companies, Ships Involved in Iran Oil Trade

The United States is sanctioning new entities and ships it accused of transporting Iranian oil and petrochemical products, the US State Department announced June 27.

The three companies and 11 ships were sanctioned in response to Iran's "actions to increase its enrichment capacity" in its bid to further expand its nuclear program, according to a statement from Secretary of State Antony Blinken.

"We remain committed to never letting Iran obtain a nuclear weapon, and we are prepared to use all elements of national power to ensure that outcome," Blinken said in a statement. "As President Biden and the other leaders of the G7 stated earlier this month, Iran must cease its escalations with regard to its nuclear program as well as its other destabilizing actions."

The companies, all headquartered in the United Arab Emirates, are Sea Route Ship Management, Almanac Ship Management, and Al Anchor Ship Management. The ships designated as blocked property are the Astra, Baltic Horizon, Nile, Yamuna, Berenice Pride, Harmony, Euro Viking, Euro Fortune, Arabian Energy, Parine and Road.

Iranian oil still flowing

Under President Joe Biden, the US has sanctioned hundreds of Iranian entities, ships, and individuals accused of transporting and selling Iranian oil, as well as individuals accused of using the proceeds to fund weapons provisions to Russia and regional proxy groups like Yemen's Houthi rebels.

Experts have questioned whether US leadership, wary of price increases in the global crude oil market, have fully enforced their stated sanctions. Meanwhile, Iran has found new ways of evading sanctions and selling oil to partners outside the West.

On June 25, when the US announced sanctions on a shadow banking network Iran allegedly uses to launder oil proceeds, Brenda Shaffer, an energy expert at the US Naval Postgraduate School, told S&P Global Commodity Insights the moves were unlikely to represent a meaningful escalation in effects.

"Adding to the weakness of sanctions is the growing cooperation between Iran, Russia and China," Shaffer said. "These countries do not need Western banks and financial systems to move money between them and to the proxies."

In May, Iran announced it planned to increase output by 400,000 b/d. The latest Platts OPEC+ survey by Commodity Insights tallied Iranian crude production at 3.17 million b/d in May, up from 2.66 million b/d in May of 2023. - S&P Global