Donald Trump, US President has decided that five big countries will no longer be excluded from penalties if importing Iranian oil still persists.
The White House has announced that sanctions waivers for Japan, China, India, South Korea and Turkey would expire on 2nd May and would not be renewed.
Political analysts suggest that the decision is specifically intended to deny Iran its principal source of revenue.
Last year, after abandoning a landmark nuclear deal with Iran, President Donald Trump reinstated the sanctions.
And under the 2015 accord with six world powers, Iran allowed for international inspectors in return for sanctions relief and also agreed to limit its sensitive nuclear activities.
The Trump administration aims to persuade Iran to agree to a “new deal” that would not only cover its nuclear activities, but also its ballistic missile programme and what officials call its “malign behaviour” across the Middle East.
However, US officials have kept their ground that they are not seeking “regime change”.
The sanctions have led to terrible nose-dive in Iran’s economy and have pushed the value of its currency to an all-time low, significantly increasing its annual inflation rate, and also driving away foreign investors, and triggering protests.
In what officials called “the core areas” of its economy, the US re-imposed sanctions on Iran’s energy, shipbuilding, shipping, and banking sectors in November.
To give them time to source alternative sources and avoid triggering a global shock to oil markets, six-month waivers from economic penalties were granted to China, India, Japan, South Korea, Taiwan, Turkey, Italy and Greece – the eight main buyers of Iranian crude – to give them time to find alternative sources and avoid causing a shock to global oil markets.
Mr Trump’s intention to end the waivers was “intended to bring Iran’s oil exports to zero, denying the regime its principal source of revenue,” the White House Said.
It also added, “The United States, Saudi Arabia, and the United Arab Emirates, three of the world’s great energy producers, along with our friends and allies, are committed to ensuring that global oil markets remain adequately supplied.”
“We have agreed to take timely action to assure that global demand is met as all Iranian oil is removed from the market.”
On Monday, there was a 2.6% increase on the price of global benchmark Brent crude to $73.87 a barrel, after earlier hitting $74.31 – the highest since November.