US lifts some sanctions targeting Iranian energy sector

The US has dropped a handful of sanctions targeting the Iranian energy sector in what a senior administration official said was evidence of Washington’s “good faith approach”. 

Antony Blinken, US secretary of state, said on Thursday Washington was lifting sanctions on three former Iranian government officials and two companies previously involved in the Iranian petrochemical sector as a result of “a verified change in status or behaviour on the part of the sanctioned parties”. 

“These actions demonstrate our commitment to lifting sanctions in the event of a change in status or behaviour by sanctioned persons,” he said in a statement.

Oil prices momentarily fell more than 2 per cent after the announcement, but quickly regained their losses, with Brent crude settling up 0.4 per cent at $72.52 a barrel on the day.

The decision marks the first time the Biden administration has relaxed any sanctions against Iran. In 2018 Donald Trump withdrew the US from a 2015 multi-party nuclear pact that had imposed limits on Iran’s nuclear programme in exchange for loosening sanctions.

The Trump administration proceeded to run a maximum pressure campaign against Iran that grew to encompass more than 1,000 additional sanctions on the country.

The Biden administration is seeking to re-enter the nuclear pact and has embarked on several rounds of indirect negotiations with Iran in Vienna, although it is yet to deliver any breakthrough. Tehran has repeatedly demanded Washington lift sanctions before it agrees to curb its nuclear programme. Since the Trump administration withdrew from the deal, Iran has violated key limits on its nuclear production sparking concern at the UN’s nuclear watchdog.

Those removed from the US Treasury’s list of specially designated nationals on Thursday included former senior officials at the National Iranian Oil Company and groups that supported the sanctioned petrochemicals sector. The US Treasury’s Office of Foreign Assets Control places individuals and entities on this list for national security, foreign policy and sanctions policy objectives.

A senior administration official told the Financial Times the decision to delist some entities from the extensive US sanctions regime was made after Iranian entities requested a review that was professionally executed. 

While the official said the removal was not related to continuing efforts with the Vienna talks, it showed the US “could act in good faith”.

“If [the Iranians] view it as proof that an entity that is sanctioned can also be unsanctioned then they will be right — being sanctioned is not a life-long sentence, it is a sentence that is based on the behaviour of the party,” the official said.

“It shows that this administration . . . will lift sanctions when warranted.”