US Treasury: "Not Related to Iran Nuclear Deal"
WTI Recovers to $70 Level...Eyes on Weekend Nuclear Deal Talks
[Asia Economy Reporter Hyunwoo Lee] International oil prices fluctuated significantly, dropping to the $68 level intraday before recovering to above $70, following news that the U.S. Treasury Department had lifted some sanctions on Iran. Ahead of this weekend's Iran nuclear deal (JCPOA - Joint Comprehensive Plan of Action) talks, interpretations suggesting a possible agreement caused oil prices to plunge, but they rebounded after the U.S. Treasury clarified that the sanctions relief was unrelated to the nuclear deal.
On the 10th (local time), the U.S. Treasury Department's Office of Foreign Assets Control (OFAC) announced that it had lifted sanctions on three former officials and two companies related to Iran's oil industry, which had been imposed during the previous Donald Trump administration to block terrorist funding. In a statement, the Treasury emphasized, "The sanctions relief targets individuals who were previously involved in the purchase, sale, transportation, and marketing of Iran's petrochemical products," adding, "This action was taken following confirmation of changes in behavior or status." However, specific details about the individuals and companies whose sanctions were lifted were not disclosed.
The announcement led to speculation that the U.S. government was signaling progress toward the Iran nuclear deal, causing international oil prices to fluctuate. On the New York Mercantile Exchange (NYMEX) that day, West Texas Intermediate (WTI) crude oil prices slid to around $68 intraday following the sanctions relief announcement but rebounded after news clarified that the relief was unrelated to the nuclear deal. WTI closed trading up 0.5% from the previous session at $70.29.
Major foreign media outlets, citing a senior U.S. Treasury official who requested anonymity, reported that "this sanctions relief is part of routine operations and is not related to the restoration negotiations of the nuclear deal," which contributed to the rebound in international oil prices. However, since the U.S. government announced it would participate in the sixth round of Iran nuclear deal talks this weekend, oil prices are expected to continue fluctuating until a final agreement is reached.
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