Defying US sanctions and a 60% drop in Iran’s oil sales, the Supreme Leader asserted on Wednesday, “We are able to export as much oil as we need and wish.”
Ayatollah Khamenei used an address to Iranian workers to respond to Monday’s announcement by the Trump Administration that it is ending sanctions waivers for Tehran’s oil purchasers, including China — which takes half of Iran’s one million barrels per day in exports — South Korea, India, Japan, and Turkey.
Khamenei maintained, “Such attempts will lead nowhere….In economic issues, they say they want to bring Iranian nation to its knees; but they must know Iranians won’t give in.”
U.S.'s efforts to boycott the sale of Iran's oil won't get them anywhere. We will export our oil as much as we need and we intend. They should know that their hostile measure won't be left without a response. Iranian nation does not sit idle in the face of animosities. pic.twitter.com/9MrphK4nwL
— Khamenei.ir (@khamenei_ir) April 24, 2019
Iran’s official level of exports have fallen from 2.5 million barrels per day in April 2018 to about 1.1 million bpd.
The combination of long-standing internal issues and sanctions have hindered production, trade, and investment. The currency has fallen 65% in value since January 2018, and annual inflation has resurged from single digits to more than 50% in March-April.
The Supreme Leader, who has declared this Iranian year one of “Pick-Up in Production”, again called for diversification of the economy, “The less we rely on such form of oil sales, the more will be appreciative and this will be better for us.”
Secretary of State Mike Pompeo said on Monday that the US will reduce Iran’s exports to “zero”, but analysts assess that a 20% to 30% reduction is more likely.
The American measures are not an embargo, threatening force to prevent shipments, but a threat against any institution financing transactions for oil.
The European Union launched a limited Special Purpose Vehicle in early February for non-dollar trade in Iranian oil and other commodities and goods. But Iranian officials rejected it because of “humiliating conditions” such as Europe’s criticism of the Islamic Republic’s missile program and its activities in the Middle East and Europe, including alleged bomb and assassination plots.