US Revokes Iran Oil Sanctions Waiver After Two Weeks, Warns Hormuz Tanker Attacks Won’t Be Tolerated

Reversal comes just over two weeks after wartime MOU

Risk of Iranian retaliation threatens follow-up talks

The US has revoked a sanctions waiver for Iranian oil just over two weeks after granting it. The move appears to be a response to a series of attacks on three tankers in the Strait of Hormuz. Any backlash from Iran could also disrupt follow-up negotiations between Washington and Tehran.

The Office of Foreign Assets Control, the US Treasury Department’s sanctions arm, announced on July 7 that it was canceling a 60-day temporary general license issued on June 21. The license had temporarily allowed the production, delivery and sale of Iranian oil. OFAC said transactions involving Iranian oil would be wound down in stages, with only previously authorized deals permitted through July 17.

The US and Iran had previously signed a wartime memorandum of understanding and agreed to waive sanctions on Iranian oil during a 60-day period for follow-up negotiations. Washington’s reversal just over two weeks later is set to send ripples through those talks.

Reuters cited a US government official as saying Iran’s actions in the Strait of Hormuz were “absolutely unacceptable” and that Tehran would “pay a price.” Another US official told the news agency that preliminary findings indicated Iran was behind the tanker attacks.

The US and Iran also clashed militarily in the Strait of Hormuz in late June over tanker attacks. After Iran struck the tankers, the US launched airstrikes on Iranian military facilities. Iran then repeatedly carried out retaliatory attacks targeting US bases in the Middle East.

The US and Iran held indirect talks through mediators in Doha, Qatar, in early July, preserving momentum for negotiations. Even so, the US decision to cancel the Iranian oil sanctions waiver could hurt the next round of talks.

Choi Su-jin, Hankyung.com reporter naive@hankyung.com