U.S. sanctions could destabilize the market, Iranian authorities say

U.S. sanctions

The U.S. sanctions against the Iranian oil industry will affect the stability of global markets, Deputy Minister of Oil Amir Hossein Zamaninia said.

“These sanctions are an example of America's bullying reaction to the change of the balance of power in the world," Zamaninia said according to a report published by SHANA.

The effect on oil prices

Oil prices hit their highest levels since November last week after Washington announced the end of all waivers imports of Iranian oil. This way, the Trump administration is pressing buyers to stop purchasing Tehran’s oil and further reduce global supplies.

Following the announcement, the White House assured it was working with Saudi Arabia and the United Arab Emirates to guarantee that the oil markets would be adequately supplied. However, operators are concerned about the reduced supplies.

Nonetheless, Amir Hossein Zamaninia affirmed that Iran’s place in the market could not be occupied by other countries, SHANA reported.

"This idea that some countries can fill the empty place of Iran's oil in the market is false from different viewpoints, including a technical and political view," Zamaninia said.

Similarly, the official also stated that the Persian Gulf can be regarded as an international route for transferring oil only if all countries.

The Commander of the Revolutionary Guard Corps said last week that Iran will move to block the strategic Strait of Hormuz is Tehran cannot use it.

U.S. sanctions seek to overthrow the Iranian government

Tighter U.S. sanctions could prompt Iran to abandon the treaty of the non-proliferation of nuclear weapons, among other options, according to Iranian foreign minister Mohammad Javad Zarif.

Iranian news agency IRNA quoted Zarif as saying the embargo is a difficult issue to overcome. Nevertheless, he sustained that his country maintains several options on the table that Iranian authorities are currently assessing.

The Iranian official stated his country has overcome these “pressures” many times. He believes that, in spite of U.S. sanctions, the nation currently appears more united and coherent than ever.

Zarif accused the United States of using sanctions to try to put Iran “on its knees” and overthrow its government by blocking its international oil trade.

The measures will affect economic growth

The International Monetary Fund (IMF) warned that U.S. sanctions on Iran added to unstable oil prices are affecting economic growth in the Middle East.

The region’s economic outlook is "clouded by elevated levels of uncertainty"., it warned in its biannual economic outlook report.

"Such uncertainty may increase investors' perception of risk for the whole region, leading to capital outflows and exchange rate pressure," the global lender said.

The IMF predicts higher inflation throughout the present year as a consequence of the U.S. embargoes. In reality, these measures affect citizens more than authorities, the organization says.

Jihad Azour, Director of the Middle East and Central Asia Department at the IMF, explained that the assessment was carried out before the U.S. ended the waivers for purchases of Iranian crude on April 22. This new development can further worsen the outlook, he said.

For more information, check Energía16

See also: Putin hopes Iran will maintain crude exports despite U.S. warnings

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