The PJ Tatler

Iran's 'Sanctions-Busting Scheme' Relies on Putin

The chairman of the House Foreign Affairs Committee is sounding the alarm about Iran inking an oil-for-goods deal with Russia that would allow the Islamic Republic to increase its oil exports in exchange for arms or new nuclear facilities.

The $20 billion accord, Rep. Ed Royce (R-Calif.) wrote to Secretary of State John Kerry, has all the makings of an attempt to “circumvent” the interim nuclear deal forged by the P5+1 in November.

“Reports indicate that Iranian and Russian officials have discussed an illicit oil-for-goods contract that could undermine the sanctions regime and weaken American negotiating leverage. These efforts to evade sanctions undermine Iran’s agreement with the P5+1 and cast serious doubt on Iranian intentions,” Royce wrote.

The agreement signed by the U.S. and Iran allows Tehran to keep up a million barrels per day of oil exports to six countries — and Russia is not one of those.

A deal with Russia, the chairman noted, could allow Iran to boost its exports by half a million barrels per day.

“Even more alarming are reports that Russia may provide Iran with arms or new nuclear facilities. Given that simple commodity exports are unlikely to total $20 billion, some experts worry that Russia might even offer the S-300 missile defense system to fulfill the contract. It would be a serious mistake for the Administration to ignore any agreement in which Russia enables illegitimate Iranian activity through nuclear construction or the supply of advanced weaponry,” Royce added.

Kerry recently told the Senate Foreign Relations Committee that an oil-for-goods deal would “raise serious concerns” and “be inconsistent with the terms” of the P5+1 deal.

“Which specific sanctions or provisions of the JPOA would a proposed barter deal violate?” Royce asked Kerry. “…What specific actions have the Department or our allies taken to deter a potential deal and address Russia’s flagrant response to engaging in prohibited trade with Iran?”

“You testified that an oil-for-goods contract ‘could trigger U.S. sanctions.’ What specific designation and enforcement steps does the Department plan to take if Iran and Russia consummate an agreement?”

Royce added that if the “sanctions-busting scheme moves forward, it would present a clear violation of Iran’s obligations and would undermine the rationale behind the current negotiations.”

“Consequently, any illegal barter deal between Iran and Russia must be met with a compelling response.”