New US Sanctions Target Iran's Petrochemical Industry

Clay Curtis
June 8, 2019

Iran said Saturday that new USA sanctions on its petrochemical industry show the hollowness of President Donald Trump's claims to be open to fresh negotiations with Tehran.

Iran rejected wider talks with the global community that would tackle nuclear and military ambitions as the United States slapped yet more sanctions on Tehran, this time hitting a petrochemical holding group that Washington says supports the Islamic Revolutionary Guard Corps (IRGC).

The administration accused it of providing support to the country's Revolutionary Guard, a paramilitary force which the USA labelled as a terrorist organisation in April.

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Washington is seeking to renegotiate the deal, a proposition which Tehran has adamantly rejected.

In 2018, the Trump administration withdrew from a 2015 deal between Tehran and leading worldwide powers that imposed restrictions on its nuclear program in exchange for sanctions relief.

The PGPIC group holds 40 percent of Iran's total petrochemical production capacity and is responsible for 50 percent of the country's petrochemical exports, the Treasury said.

The US Treasury statement said Iran's oil ministry previous year awarded the IRGC's Khatam al-Anbiya - its economic development and engineering arm - 10 projects in oil and petrochemical industries worth $22bn, four times the official budget of the IRGC.

The Treasury Department imposed sanctions on the Persian Gulf Petrochemical Industries Company and 39 of its subsidiaries and foreign sales agents.

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McKenzie said tensions between the US and Iran have continued to increase, especially since last month when the USA moved an aircraft carrier group in the region after receiving information of a looming threat of Iranian attack.

"This action is a warning that we will continue to target holding groups and companies in the petrochemical sector and elsewhere that provide financial lifelines to the IRGC".

On April 8, it designated Iran's Revolutionary Guards a "foreign terrorist organisation", paving the way for sanctions against their sources of funding.

The most recent sanctions only added to the existing tensions between Tehran and Washington, which have been severely exacerbated by the USA military build-up in the region, including the deployment of an additional 1,500 troops, B-52 bombers, and a U.S. aircraft carrier to the Middle East.

The sanctions are part of the administration's "maximum pressure" campaign against Iran and freeze any assets the targeted firms may have in USA jurisdictions and bar Americans from doing business with them.

The United States has sanctioned an Iranian petrochemical holdings group, the Treasury Department announced, the latest move in Washington's "maximum pressure" campaign against Tehran.

Friday's step makes PGPIC and the 39 affiliates "specially designated nationals", a status that effectively blocks United States persons from dealing with them. The new measures follow a round of sanctions imposed last month that targeted the Islamic Republic's export revenues from industrial metals.

"It's a good way of keeping the political pressure on the front page", the former official said.

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