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As Trump pulls out of Iran deal, Asia grapples with impact on oil supplies
Asia’s petroleum refiners are scrambling to find alternative supplies as they prepare for renewed U.S. sanctions against major oil exporter Iran amid an already tight market.
Iran is the third-largest oil producer in the Organization of the Petroleum Exporting Countries (OPEC) and a major supplier, especially to refiners in Asia.
The United States plans to impose new unilateral sanctions after abandoning an agreement reached in late 2015 which limited Iran’s nuclear ambitions in exchange for removing joint U.S.-Europe sanctions, which included strict curbs on crude oil exports. economy relies heavily on oil revenue. New U.S. sanctions will include measures aimed at its petroleum and shipping sectors, with a six-month “wind down” period “to allow both U.S. companies but foreign companies as well to end contracts, terminate business, (and) get their money out”, according to the U.S. State Department.
“President Trump is clearly articulating that he has minimal desire in an alternative agreement with Iran,” said Ehsan Khoman, head of research for Middle East and North Africa at Mitsubishi UFJ Financial Group.
Iran’s government lashed out at Trump, with the speaker of Iran’s parliament stating the U.S. president “does not have the mental capacity to deal with issues.” United States did not consult with businesses in making the decision to pull out of the deal.