US punishes Iran over attacks on ships in Strait of Hormuz
Photo: oil tanker (Getty Images)
Incidents involving tankers in the Strait of Hormuz have led to the cancellation of Iran's oil license, which could increase pressure on its economy, according to the US Department of the Treasury.
The US Treasury Department's Office of Foreign Assets Control (OFAC) has revoked the general license that, since June 21, had permitted the production, supply, and sale of Iranian crude oil, petroleum products, and petrochemical products.
As of July 7, the previous authorization has expired. At the same time, the US authorities have granted a transition period until July 17 to complete previously permitted operations.
According to Reuters, a US official stated that Iran's actions in the Strait of Hormuz are absolutely unacceptable and will have consequences.
The British maritime security service UKMTO reported that in recent days, three tankers have reported being struck by unknown projectiles in or near the Strait of Hormuz. Tehran has neither commented on the incidents nor claimed involvement in the attacks.
Following the US decision, oil prices rose by more than 5%. Prolonged disruptions to vessel traffic through the strait could push energy prices higher and increase pressure on consumers and governments already facing higher fuel costs.
At the same time, the US stated that representatives of Washington and Tehran continue to work on a final agreement. Such an agreement could include restrictions on Iran's nuclear program in exchange for a partial easing of sanctions, including those on oil exports.
Oil sales are one of Iran's main sources of foreign currency revenue. Despite sanctions, the country has been increasing its supplies in recent years, primarily to China. The new restrictions could increase pressure on Iran's economy and state finances.
On July 1, the US and Iran completed another round of indirect negotiations in Qatar. US leader Donald Trump stated that there had been some progress on the issue of Tehran's nuclear program, but the parties have still not overcome disagreements over financial and territorial issues.
After the cessation of mutual strikes between the US and Iran, oil prices almost returned to pre-war levels. At the same time, the market remains cautious, as the future of the agreements and the safety of shipping in the Strait of Hormuz remain in question.
