Renewed US sanctions would halve Iran's oil export in mid-term

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That is part of a flurry of diplomatic activity following Tuesday's unilateral withdrawal from what US President Donald Trump called "a awful, one-sided deal", a move accompanied by the threat of penalties against any foreign firms doing business in Iran. Oman and Kuwait also gave circumspect positions. The current plan, inasmuch as there is one, is to outlast Trump and preserve all the frameworks he's trying to break until the next US president takes office. "These are very, very strong sanctions; they worked last time".

Saudi Arabia is ready to offset any supply shortage but it will not act alone to fill the gap, an OPEC source familiar with the kingdom's oil thinking said on Wednesday. They don't want to be a lackey of the U.S. policy in the region. However, this time around USA enforcement could be much weaker.

"It's classic "buy on the awful news"," said Ian Winer, director of trading at Wedbush Securities in Los Angeles, referring to the wider market's rally.

"The Prime Minister raised the potential impact of USA sanctions on those firms which are now conducting business in Iran". Although a reactor deal would produce the highest revenue, there are many other important areas through which the United States can assist the Saudi nuclear program-from developing its power grid, building related infrastructure to training personnel, and developing independent legislative body.

In an interview with CNN, said the foreign Minister of Saudi Arabia Abdel al-Jubeir.

Washington's allies may find formulas to avoid sanctions exposure.

"In the short to medium term, I do not envisage a fall in Iranian exports to below one million barrels a day".

"The deal has been structured in a way that it is shielded from any potential liability or prosecution under the American sanctions", said an Omani analyst, who declined to be named due to the sensitivity of the subject.

But she also said: "If everybody does what they like, then this is bad news for the world".

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Trump himself says he opposed the war but some veterans of former president George Bush's administration - notably the newly elevated Bolton - defend it to this day.

The US withdrawal from the nuclear deal with Tehran on Tuesday is the first step in the American plan for a regime change in Iran carried out in accordance with the Iraqi scenario, Middle East expert Sami Ramadani told RT.

Trump said his decision to leave the JCPOA was created to counter that possibility.

"It's quite possible that surging USA shale production could easily fill the gap left by Iran", Eberhart said.

The three European powers - which brokered the JCPOA along with the EU, U.S., China and Russian Federation - had hoped to work with Washington on steps that might address Trump's concerns, including efforts to limit Iran's ballistic missile program and curb its military activity throughout the Middle East. "I don't think Iran is capable of making further concessions - they said they've never planned to develop nuclear weapons| and its compliance with the deal has been confirmed by the IAEA on numerous occasions", he added.

The only companies who may feel unthreatened are those able to route transactions entirely outside the United States, without using financial institutions with any USA exposure, or those who have nearly no exposure to the U.S., she said.

Saudi Arabia signaled it could be willing to shift gears and ramp up production to compensate for the loss of crude from archrival Iran.

Analyst Dorsey believes Iran will not compromise on its ballistic missile programme "because that is the core of their defence policy".

Iranian crude oil shipments to Japan and South Korea have fallen by half from their post-sanction peak in March 2017, hitting just over 300,000 bpd in April, according to ship tracking data from Thomson Reuters Eikon.

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