There will be consequences as a result of the United States’ sanctions on Iran's oil industry which are due to be re-imposed in November, Russian Energy Minister Alexander Novak has said.
“Our position remains that this is unproductive, this is wrong,” he told CNBC when talking about the sanctions’ possible impact on Iran's oil industry.
According to Novak, “It is better to continue working in the market, Iran being just another exporter that provides stable supplies to the market.”
The Russian minister explained that Iran is one of the richest countries in terms of resources and has a “solid standing in terms of its energy capability both in the OPEC, and in the energy markets as a whole. So, I think there will be consequences, I am sure, but we could only comment once they are in place.”
Novak added: “We do not know how companies will react, how countries that engage with Iran will react. We will have to see the actual adopted documents/sanctions.”
In May, US President Donald Trump announced withdrawal from the 2015 nuclear deal, the Joint Comprehensive Plan of Action (JCPOA), and he is expected to ratchet up the pressure on Tehran by blocking Iranian oil exports in November, potentially halting some two million barrels a day, or 50 percent of Iran’s output.
Washington said any countries or companies that conduct transactions with Iran were liable to face secondary sanctions. That has caused major Western firms to pull out of the country. The EU asked Washington to grant exemptions to European companies but Washington has rejected the appeal, saying exemptions would be made only if they benefited US national security.
Moscow has reaffirmed its commitment to JCPOA, and said Washington’s decision to re-impose sanctions was “disappointing.” It has boosted economic cooperation with the Islamic Republic while announcing multi-billion dollar investments in Iran's energy sector. Russian energy giants Rosneft and Gazprom are also in talks with the oil ministry of Iran to potentially sign deals worth up to $10 billion.
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