INSTEX A Moment In Time

Whilst large European oil companies have resisted every attempt by the EU to get them to engage with the INSTEX mechanism to trade with Iran,

China has no such compunctions. The New York Times in a recently published article, after  claiming to have received  information from multiple sources alleged  that China has been receiving oil shipments from a larger number of Iranian tankers than was previously known.

The Trump Administration has already imposed sanctions on Zhuhai Zhenrong, a Chinese state-owned enterprise, and its top executive Li Youmin, But in all reality it will have to impose sanctions on the Peoples Bank and Sinopec if it is not to lose face and that is a tall order.

US sanctions are not legal just another example of  their assertions of extra territorial jurisdiction. China had made it very clear that US sanctions regime would not determine their commercial interests. But to hear American politicians speak you wouldn’t think so. Senator Marco Rubio said  "While I'm glad the administration sanctioned an initial round of Chinese actors, it must step up strong enforcement to deter Chinese and other foreign actors from violating US sanctions against Iran," He went further "The Iranian regime has blatantly shipped millions of barrels of oil to China."

Meanwhile the remaining signatories to the JCPOA nuclear deal last week formally unveiled a Europe-led plan to create a special purpose vehicle to maintain commercial ties with Iran, including for oil exports. The nuclear accord was signed by China, Russia, France, Germany and the UK, as well as Iran and the US.

A Chinese Foreign Ministry spokesman,  Geng Shuang, said on July 19 that the Trump administration's "maximum pressure" campaign against Teheran was the "root cause of the current tensions" involving Iran and that Washington should "correct its wrongdoing".