Trump Could Push Iran Closer to China If Sanctions Are Renewed
Trump Could Push Iran Closer to China If Sanctions Are Renewed
(Bloomberg) -- Donald Trump’s resentment of the Iran nuclear deal could help China’s oil ambitions.
The U.S. president will have to decide this month whether to renew a waiver that lifted banking, oil and shipping sanctions on OPEC’s third-biggest producer. Should Trump reimpose sanctions on dollar-denominated business with Iran, it could force the Islamic Republic to move closer to China to ensure it can continue shipping its oil, said Bjarne Schieldrop, chief commodities analyst at SEB AB.
The timing of the decision could be good for China, which is the world’s biggest energy consumer and wants more influence over crude pricing. The Asian giant is gearing up to launch its long-delayed crude oil contracts on the Shanghai International Energy Exchange on Jan. 18.
Any restrictions on transactions in dollars “could force Iran to accept the yuan contract and give the Chinese contract a flying start," Schieldrop said.
Click here to read the full Q&A with Schieldrop in Thursday’s Oil Brief.
To contact the reporter on this story: Christopher Sell in London at csell1@bloomberg.net.
To contact the editors responsible for this story: James Herron at jherron9@bloomberg.net, Rakteem Katakey
©2018 Bloomberg L.P.