US Sanctions Chinese, Emirati Firms Over Iran Petrochemicals

Thursday, 06/16/2022

The US Thursday sanctioned Chinese, Emirati and Iranian firms over exporting Iran's petrochemicals, linking it to pushing Iran to renew the 2015 nuclear deal.

“The United States is pursuing the path of meaningful diplomacy to achieve a mutual return to compliance with the Joint Comprehensive Plan of Action,” Under Secretary of the Treasury for Terrorism and Financial Intelligence Brian Nelson said in a statement, referring to the 2015 agreement.

But Nelson said that unless agreement was reached over the JCPOA, the US would “continue to use our sanctions to limit exports of petroleum, petroleum products, and petrochemical products from Iran.”

Thursday’s move came under Executive Order (EO)13856, part of the ‘maximum pressure’ sanctions introduced by President Donald Trump on withdrawing the US from the JCPOA in 2018. The measures gave the US government powers to sanction third-parties buying Iranian oil and petrochemicals or dealing with Tehran’s financial sector.

Blocked assets

Thursday’s statement announced “all property and interests in property of these targets that are in the United States or in the possession or control of US persons must be blocked and reported to OFAC [the US Treasury’s Office of Foreign Assets Control].” It warned that anyone engaged in “certain transactions with the individuals and entities designated today may themselves be exposed to sanctions.”

President Joe Biden came into office committed to reviving the JCPOA but has maintained ‘maximum pressure.’ While the Trump administration outlined a set of 12 demands – including Tehran ending all uranium enrichment and ending its missile defense program ­– it expected Iran to accept before these sanctions were lifted, the Biden administration took part in year-long talks in Vienna with Iran and other world powers with the aim of JCPOA revival.

With the talks paused since March, supporters and critics of the JCPOA in the US have both questioned what Biden aims to achieve, and whether he has a ‘plan B’ should agreement not be reached over reviving the 2015 agreement.

Iran has insisted that all sanctions introduced by Trump – including reportedly his designation of Iran’s Revolutionary Guards as a ‘foreign terrorist organization’ – need to be lifted if it is to return to the JCPOA, whose provisions it began infringing in 2019, the year after the US left the agreement.

‘Lax enforcement’

JCPOA opponents in the US have argued that the Biden administration has been lax in implementing third-party sanctions, allowing Tehran to maintain oil and other exports, especially to China. With the Ukraine crisis, Tehran is also benefiting from the rising oil prices even as Beijing has cut back its purchases in favor of cheaper Russian crude.

The latest US designation, the Treasury statement said, targeted companies and individuals in China and the United Arab Emirates working with Triliance Petrochemical Company and Petrochemical Commercial Company (PCC) in brokering the sale of Iranian petrochemicals “to customers in the PRC and the rest of East Asia.”

Triliance was designated under EO 13846 in January 2020, and PCC in 2018 under EO 13599, an order dating from President Barack Obama in 2012 allowing the sanctioning of companies owned by the Iranian government.

Thursday’s statement sanctioned Iran’s Marun Petrochemical, Kharg Petrochemical, and Fanavaran Petrochemical; Hong Kong-based Keen Well International, and Teamford Enterprises; and the UAE companies GX Shipping, Future Gate, Sky Zone Trading, and Youchem.

The Treasury also sanctioned two individuals Jingfeng Gao, a China-based broker, and Mohammad Shaheed Ruknooddin Bhore, an India-based Indian national, “for having materially assisted, sponsored, or provided financial, material, or technological support for, or good or services in support of, Triliance.”

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