Published: Wed, July 04, 2018
Business | By Kate Woods

USA aims to reduce Iran’s oil revenue to zero


President Donald Trump lashed out at OPEC with a warning to stop manipulating oil markets and piled pressure on close United States allies in an interview that aired on Sunday with a threat to sanction European companies that do business with Iran.

"We are prepared to work with countries that are reducing their imports on a case-by-case basis, but as with our other sanctions, we are not looking to grant waivers or licenses", Hook said, in comments that were seen as a softening of the United States' prior demands.

"The (Iranian) government has a plan. and God willing we are certain that we will be able to sell as much oil as we want", he said.

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The Trump administration vowed to stick with its pressure campaign against Iran on Monday, affirming its strategy to change Tehran's behavior by gutting its oil revenue and isolating the country globally.

The Organization of the Petroleum Exporting Countries agreed with Russian Federation and other oil-producing allies last month to raise output from July, with Saudi Arabia pledging a "measurable" supply boost but giving no specific numbers.

Buyers of Iranian crude oil have been hoping for relief from US sanctions in order to have more time to reduce purchases. On Monday, Hook expressed confidence that the USA sanctions policy would not prompt mass shortages, but analysts have expressed doubt that Saudi Arabia can increase production by as much as Trump described.

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OPEC members agreed on June 22 to increase collective production by around one million barrels per day, in a context where oil prices have approximately doubled from a 2016 low.

The development came days after the oil-rich Persian Gulf state, which is the world's largest oil exporter, agreed to substantially raise production. "The immediate reaction following the announcement has been negative, with WTI trading around $73.67 (on Tuesday afternoon)". "They seek to push Iranian exports of crude, condensate, and oil products to zero", energy consultancy FGE said in a note. King Abdullah II of Jordan, Sheikh Sabah Al-Ahmad Al-Jaber Al-Sabah, Emir of Kuwait, Sheikh Mohammed bin Rashid Al-Maktoum, Vice President, Prime Minister of the UAE and Ruler of Dubai attended the meeting.

The cabinet praised the Kingdom and the UAE's adoption of a joint strategy for integration between the two countries economically, developmentally and militarily through 44 projects called "Resolve Strategy".

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