US senators tell Biden he is risking national security by failing to act against Iranian oil sales

A group of U.S. senators are concerned that Iranian exports of oil slipping through the cracks of American sanctions are enhancing Tehran’s ability to finance terrorism and gain nuclear capabilities – and placing national security at risk.

The 10 Republicans sent a letter to U.S. President Joe Biden last week urging action “against entities that purchase Iranian oil and against those foreign-flagged oil tankers which keep Iran’s illicit oil trade alive.”

The senators who signed the letter include Bill Hagerty, Chuck Grassley, Tom Cotton, Joni Ernst, Ted Cruz, Mike Braun, Marsha Blackburn, Thom Tillis, John Cornyn and James Lankford.

“As you are aware, Iran’s energy sector is a primary source of funding to the Islamic Revolutionary Guard Corps, a designated foreign terrorist organization,” the senators wrote.

The letter is critical of the Biden administration’s approach to Iran compared to former U.S. President Donald Trump’s “maximum pressure” campaign of sanctions against Tehran, which “seriously reduced Iranian oil exports and curtailed the Iranian regime’s ability to finance terrorism and other malign activities.”

“This massive drop in revenue gave the U.S. significant leverage over Iran and impeded the regime’s strategic ambitions,” they wrote.

Trump pulled out of the Joint Comprehensive Plan of Action – commonly referred to as the Iran nuclear deal – in 2018. During the campaign, Biden promised to re-enter the deal and Washington is currently in the midst of negotiations with Iran to refurbish the deal, however those talks recently reached an impasse.

“The boom in oil sales has refilled the Iranian regime’s once-empty coffers, removed crucial American leverage over Iran, and encouraged the Iranians to stall negotiations in Vienna and irreversibly advance their pursuit of a nuclear weapon,” the letter stated.

“It is long past time to stop dithering. You are putting U.S. national security at risk. We urge you to enforce U.S. sanctions against entities that purchase Iranian oil and against those foreign-flagged oil tankers which keep Iran’s illicit oil trade alive.”

Of primary concern is Iran’s sale of oil to China.

“In recent weeks, the Chinese government has openly acknowledged importing millions of barrels of Iranian oil for its strategic petroleum reserves,” the senators noted. “As a result of this surge in oil sales, Iranian currency reserves soared from just $4 billion at the end of 2020 to $31 billion at the end of 2021. These Chinese purchases give the Iranian regime a vital lifeline and flout US sanctions with impunity.”

“While your administration has reportedly warned China and other countries about the sanctions risks to their companies, these entities remain unpunished,” they wrote.

Text of the letter may be found here and below.

President Joseph R. Biden
The White House
1600 Pennsylvania Avenue, N.W.
Washington, D.C. 20500 

Dear President Biden, 

We write to urge you to take action against the growing fleet of oil tankers evading U.S. sanctions and against the entities purchasing Iranian oil from these tankers.

As you are aware, Iran’s energy sector is a primary source of funding to the Islamic Revolutionary Guard Corps, a designated foreign terrorist organization. Because of its critical role in funding terrorism, the National Iranian Oil Company is subject to U.S. terrorism sanctions.  Therefore, enforcing oil sanctions against Iran is also enforcing terrorism sanctions against Iran. Bipartisan laws enacted by Congress in 2011 and 2012 targeting Iran’s oil exports and energy sector require the President to enforce these sanctions.

The U.S. maximum pressure campaign seriously reduced Iranian oil exports and curtailed the Iranian regime’s ability to finance terrorism and other malign activities. From April 2018 to June 2020, Iranian oil exports shrank from nearly 2.9 million barrels per day to 600,000 barrels per day.  Tehran faced severe budget deficits in 2019 and 2020 due to the decline in oil sales. This massive drop in revenue gave the United States significant leverage over Iran and impeded the regime’s strategic ambitions.

These gains have been threatened by the disturbing rise in Iranian oil exports since your administration began, despite U.S. sanctions remaining in place. Iran exported an estimated 418 million barrels of oil in 2021, 123 million more than in 2020.  Twice in 2021, Iranian oil exports exceeded 1.4 million barrels per day, the highest rate since March 2019.  Three-quarters of this oil was exported to China, which purchased 310 million barrels of Iranian oil last year.  In recent weeks, the Chinese government has openly acknowledged importing millions of barrels of Iranian oil for its strategic petroleum reserves. 

As a result of this surge in oil sales, Iranian currency reserves soared from just $4 billion at the end of 2020 to $31 billion at the end of 2021.  These Chinese purchases give the Iranian regime a vital lifeline and flout U.S. sanctions with impunity. While your administration has reportedly warned China and other countries about the sanctions risks to their companies, these entities remain unpunished.

Iran’s increased oil exports are only possible because non-Iranian, foreign-flagged vessels are increasingly willing to risk U.S. sanctions to sell Iranian oil. Much of this activity is done illicitly, with foreign-flagged tankers transferring oil at sea from Iranian tankers to obscure the origin of their illegal cargo. These vessels avoid sanctions by hiding behind shell companies and often flying a false flag. Other such vessels turn off their satellite transponders, change their flag, or register under the flag of a country where maritime authorities are willing to look the other way. The number of foreign-flagged tankers suspected of involvement in the transport of Iranian oil has more than doubled from 70 vessels in November 2020 to 165 vessels in January 2022.  This fleet will only continue to grow if your administration keeps refusing to crack down on this practice.

The vessel owners and their customers in China are taking greater risks because they believe that your administration is too weak and indecisive to punish them for their crimes. Your   unwillingness to take actions that could jeopardize the doomed Vienna nuclear talks has undeniably emboldened these criminals. Meanwhile, the boom in oil sales has refilled the Iranian regime’s once-empty coffers, removed crucial American leverage over Iran, and encouraged the Iranians to stall negotiations in Vienna and irreversibly advance their pursuit of a nuclear weapon. It is long past time to stop your dithering. You are putting U.S. national security at risk.

We urge you to enforce U.S. sanctions against entities that purchase Iranian oil and against those foreign-flagged oil tankers which keep Iran’s illicit oil trade alive. Each day you delay gives Iran more money to finance their terrorist activity and more time to develop a nuclear weapon. We would also remind you that sanctions against Iran’s oil exports are mandatory and passed Congress with bipartisan majorities. You are not above the law and must stop violating it. 

The radical mullahs in Iran will only abandon their nuclear ambitions when they believe time is no longer on their side. Decisive action by your administration can stop the regime’s malign activity; more concessions and polite expressions of impatience are not going to cut it.

Thank you for your attention to this matter. We look forward to hearing from you.

Sincerely,