News : Economy
- Published: Thursday, 19 July 2018
by Jazeh Miller
Ever since Donald Trump pulled the US out of the 2015 Iran nuclear deal, otherwise known as the Joint Comprehensive Plan of Action (JCPOA), the US has been warning its allies and even some neutral countries about the importance of ending their reliance on Iranian oil before the November deadline when US sanctions will snap back into place.
The US State Department has also expressed that it is not anticipating providing any waivers or extensions, which means that there will be no exemptions for anyone.
Iran, which is the third-largest oil producer in the Organization of the Petroleum Exporting Countries (OPEC), currently counts China, India, South Korea, Japan, and Turkey as its biggest importers, but not for long.
Oil price rise
This announcement caused panic in the oil market, despite the fact that other oil-producing countries are more than able to pick up the slack, and oil prices rose by over 3.5 percent.the Iranian Oil Minister Bijan Zanganeh claimed that the increase in oil prices was directly related to the US sanctions, while others have stated that these high oil prices serve the interest of oil-dependent economies like Saudi Arabia, Russia, and Iraq, which will now serve as alternatives for Iranian oil.
But high oil prices are only a temporary problem. The market will right itself once it realises that there will not be a shortfall in oil, even if Iran’s oil exports drop from 2.7 million barrels per day (bpd) to 1 million bpd, as they did under the last period of strong economic sanctions between 2013 and 2015.
The real beneficiaries of the sanctions
While other oil producing countries will no doubt see a rise in profit as a result of the US sanctions, it is remiss to ignore the other people who will benefit enormously from these sanctions: the Iranian people.
The JCPOA allowed foreign money to flow into Iran in exchange for oil exports and other trade, but the Iranian people saw none of this. Instead, the money was stolen by the Regime and used to pay for foreign wars, terrorist groups, the severe oppression of the Iranian people, and to strengthen the Iranian nuclear programme.
The sanctions will cause the Regime’s fragile economy to collapse and allow the people to take over. The Iranian people and their organised resistance, the National Council of Resistance of Iran (NCRI), are desperate for these sanctions to come into place and bring the mullahs to their knees so that the Iranian people can give the death blow.