WASHINGTON — The U.S. is considering sanctions that would target a United Arab Emirates-based businessman and a network of companies suspected of helping export Iran’s oil, part of a broader effort to escalate diplomatic pressure on Tehran as U.S. officials push to reach a deal on Iran’s nuclear program.
The firms and individuals under scrutiny have been using ship-to-ship transfers of oil in waters that lie between Iraq and Iran and then forging documents to hide the origin of the cargo, according to corporate documents reviewed by The Wall Street Journal, shipping data and people familiar with the matter. By passing off the blended oil as Iraqi, those involved can avoid Western sanctions targeting Iranian oil.
Yet plans to target these sorts of suspected sanctions-evading operations present a dilemma for the Biden administration, which is balancing the desire to rein in Iran’s nuclear program while also dealing with inflation driven in part by international sanctions against oil-exporting giant Russia, according to current and former officials familiar with the issue.
Since the nuclear talks stalled earlier this year, the Biden administration has levied two rounds of sanctions against companies it alleges are smuggling Iranian oil, an escalation designed to remind Iran of the costs of failing to negotiate. Still, some current and former U.S. officials say the Biden administration has held at bay a full-scale enforcement campaign in order to revive the nuclear agreement, which President Trump pulled out of in 2018.
“So long as the Iranians don’t take the offer on the table and return to the JCPOA,” a senior administration official said, referring to the nuclear agreement, “my expectation would be that we will continue to see a roll out of these sorts of enforcement actions on a pretty regular basis going forward.”
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