Earlier this month, the Energy Information Administration (EIA) released its first report on Iran’s oil exports, as required by the Stop Harboring Iranian Petroleum (SHIP) Act. The report revealed that Iran sold $144 billion in oil during the first three years of the Biden administration. This is $100 billion more than Iran exported in the last two years of the Trump administration, when oil sanctions were strictly enforced.
The SHIP Act mandates the EIA to report on Iran’s total petroleum export volume and revenue, detailing sales to China and other countries, as well as pricing. It also requires analysis of Iran’s labeling practices for exported oil and a description of the companies, ships, and ports involved in these transactions.
The report confirmed critics’ claims that Iran’s oil exports have increased under Biden. Between 2021 and 2023, Iran sold $144 billion worth of oil and petroleum products, a stark contrast to the “Maximum Pressure” strategy, which saw exports drop to just $16 billion in 2020. Notably, crude oil and condensate exports more than tripled during this time, exceeding 1.59 million barrels per day, while exports of petroleum products rose over 50%.
The Biden administration insists it is enforcing sanctions, but the EIA’s findings suggest otherwise. Concerns about rising oil prices may have influenced the administration’s approach. Despite this, other oil producers could have compensated for any increase in Iranian exports. Currently, Iran exports about 1.7 million barrels per day, while OPEC’s spare capacity is above 5 million barrels per day, excluding Iran, Russia, and Libya.
The report, however, does not fully address all aspects required by the SHIP Act. It lacks details on the labeling of exported oil and the companies involved, stating it does not have enough data or authority to collect this information. Additionally, it fails to identify the Chinese refineries that process most of Iran’s oil.
Future EIA reports could be improved by incorporating tanker traffic data to better estimate Iran’s exports, rather than simply subtracting domestic consumption from production. The report may also overestimate Iran’s revenue by not factoring in the discounts offered to customers.
Despite its limitations, the EIA report can guide policymakers looking to tighten enforcement. The U.S. government could designate the tankers and companies identified in the report, along with unnamed Chinese refineries, including their board members and executives.
The U.S. has not yet targeted the port operators involved in Iranian oil exports. The report names ports in 28 countries, including China, Eritrea, Turkey, and Venezuela. Focusing on these operators could increase pressure on networks involved in illegal oil exports.
While the SHIP Act did not require identifying the banks and insurance companies facilitating these transactions, doing so is crucial to curbing Iran’s illicit oil exports.
U.S. policy is most effective when based on accurate information. The EIA report represents progress in this area, as it supports efforts to limit the revenue that the Iranian regime generates from oil sales.
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