U.S. President Donald Trump has decided not to reissue waivers in May allowing importers to buy Iranian oil without facing U.S. sanctions, the White House said in a statement on April 21.
The United States, Saudi Arabia and the United Arab Emirates "have agreed to take timely action to assure that global demand is met as all Iranian oil is removed from the market," the White House said.
"This decision is intended to bring Iran's oil exports to zero, denying the regime its principal source of revenue," the statement added.
The decision means sanctions waivers for five nations, including China and India, Japan, South Korea and Turkey, won't be renewed when they expire on May 2.
U.S. Secretary of State Mike Pompeo said Washington has had "extensive and productive discussions with Saudi Arabia, the United Arab Emirates, and other major producers to ease this transition and ensure sufficient supply."
U.S. Senator Ted Cruz (Republican-Texas) applauded the end of oil waivers for Iran.
"This decision will deprive the ayatollahs of billions of dollars that they would have spent undermining the security of the United States and our allies, building up Iran's nuclear and ballistic-missile programs and financing global terrorism," he said.
The move is part of the Trump administration’s tough line on Iran.
"We will continue to apply maximum pressure on the Iranian regime until its leaders change their destructive behavior, respect the rights of the Iranian people, and return to the negotiating table," Pompeo said in an April 22 statement.
Oil exports are a key source of revenue for Tehran, which has been hit hard by the reimposition of U.S. sanctions.
Iran’s Foreign Ministry denounced the U.S. sanctions on Iran’s oil sector as “illegal.”
"Since the sanctions in question are principally illegal, the Islamic Republic of Iran did not and does not attach any value or credibility to the waivers," the Foreign Ministry said on its website on April 22.
Abbas Mousavi, a Foreign Ministry spokesman, told reporters Tehran is reviewing the U.S. decision, adding that "the results of these reviews will be presented to the political leadership and the decision will be announced shortly.”
Iran has repeatedly threatened to withdraw from the 2015 nuclear agreement if U.S. sanctions aimed at Iranian oil exports are tightened.
Ahead of Washington’s announcement, an unnamed Iranian Oil Ministry source told the semiofficial Tasnim news agency that the United States will fail to cut Iranian oil exports to zero.
“Whether the waivers continue or not, Iran’s oil exports will not be zero under any circumstances unless Iranian authorities decide to stop oil exports...and this is not relevant now,” Tasnim quoted the unnamed “informed source” as saying.
"We have been monitoring and analyzing all possible scenarios and conditions for the advance of our country's oil exports, and necessary measures have been taken...Iran is not waiting for America's decision or the lack of it to export its oil," the source said.
There were swift reactions in the region to the Trump administration’s decision with Israeli Prime Minister Benjamin Netanyahu saying the move "is of great importance for increasing pressure on the Iranian terrorist regime."
"We stand with the United States' determination against Iranian aggression and this is the right way to stop it," Netanyahu said on April 22.
However, Turkey criticized the U.S. decision, saying it "will not serve regional peace and stability."
In a message posted on Twitter on April 22, Turkish Foreign Minister Mevlut Cavusoglu said: "Turkey rejects unilateral sanctions and impositions on how to conduct relations with neighbors."
Trump tweeted on April 22 that U.S. ally Saudi Arabia will help to make up easily for any shortfalls in oil supply.
"Saudi Arabia and others in OPEC will more than make up the Oil Flow difference in our now Full Sanctions on Iranian Oil," Trump said in a tweet.
Shortly after Washington’s announcement, Saudi Arabia said that it would coordinate with other oil producers “to ensure adequate supplies are available to consumers while ensuring the global oil market does not go out of balance.”
"Saudi Arabia is closely monitoring the oil market developments following the recent statement from the U.S. government regarding oil export sanctions on Iran," Energy Minister Khalid al-Falih said in a statement.