Saudi Arabia and UAE have assured the U.S. they will ensure the market has an “appropriate supply,” Pompeo said. He said the suppliers have been working directly with Iran’s customers to make the transition away from Iranian barrels less disruptive.
The Saudis stopped short of explicitly guaranteeing a change in policy but reiterated its commitment to balancing oil supply and demand.
The kingdom will “coordinate with fellow oil producers to ensure adequate supplies are available to consumers while ensuring the global oil market does not go out of balance,” Saudi Energy Minister Khalid al-Falih said on Monday.
“In the next few weeks, the Kingdom will be consulting closely with other producing countries and key oil consuming nations to ensure a well-balanced and stable oil market, for the benefits of producers and consumers as well as the stability of the world economy,” Falih said in a statement.
Following Washington’s official announcement, Trump tweeted that Saudi Arabia and other OPEC members will “more than make up” for any drop in Iranian supplies.
Three of the countries that received the exemptions — Greece, Italy and Taiwan — have already cut their imports from Iran to zero. However, analysts widely expected the Trump administration to extend the waivers to China, India, Japan, South Korea and Turkey, all of which took advantage of the waivers during the first six-month window that began in November.
Companies in those countries now face the threat of being locked out of the U.S. financial system if they continue to import crude from Iran. The question is whether some of those countries will seek to skirt the sanctions, including by facilitating or encouraging purchases of Iranian crude through companies not tied to the U.S. financial system.
China’s Foreign Ministry on Monday denounced Washington’s Iran policy.
“China opposes the unilateral sanctions and so-called ‘long-arm jurisdictions’ imposed by the US. Our cooperation with Iran is open, transparent, lawful and legitimate, thus it should be respected,” Foreign Ministry spokesperson Geng Shuang told reporters.
“Our government is committed to upholding the legitimate rights and interests of Chinese companies and will play a positive and constructive role in upholding the stability of global energy market.”
Turkish Minister of Foreign Affairs Mevlut Cavusoglu also rejected the sanctions, saying they “will not serve regional peace and stability” and would hurt the Iranian people.
Dialing up pressure on Iran threatens to spark maritime conflict in the Persian Gulf. Iran has long threatened to shut down the Strait of Hormuz, the world’s busiest transit lane for seaborne oil shipments, if it is prevented from exporting oil.
On Monday, Iranian officials renewed those threats.
“According to international law, the Strait of Hormuz is a marine passageway and if we are barred from using it, we will shut it down. In case of any threat, we will have not even an iota of doubt to protect and defend the Iranian waters,” Rear Admiral Alireza Tangsiri, commander of the Islamic Revolution Guards Corps’ Navy, told the al-Alam news channel, according to Iran’s semi-official Fars news agency.
Earlier this month, the Trump administration designated Iran’s Islamic Revolutionary Guard Corps a terrorist organization, marking the first time the U.S. has applied the designation to a foreign country’s military.