Japan still has no Iran sanctions waiver after talks with US officials

TOKYO (Reuters): Japan said on Thursday it had not yet been granted a waiver from a US plan to reimpose sanctions aimed at cutting Iran out of international markets, while the top two customers for Iranian oil, China and India, were awaiting word on possible exemptions.

The United States has said it is considering waivers on sanctions for countries that are reducing their imports of Iranian oil. The renewed US sanctions on Iran are set to come into effect on 4 November.

“Japan-US talks have been conducted four times so far on US sanctions on Iran,” Chief Cabinet Secretary Yoshihide Suga, Japan’s top Government spokesman, told a news conference.

“The Japanese side has asked that the impact would not affect the activities of Japanese companies. I’d like to refrain from further comments on the details of the talks.”

US National Security Adviser John Bolton said on Wednesday the Trump administration wants sanctions on Iran’s crude exports to strain Tehran, but does not want to harm countries that depend on the oil.

India also hopes to secure a waiver, as it has significantly cut Iranian oil imports ahead of the deadline, officials there said last month.

“The US is aware of our stand. We have told them that we cannot stop buying Iranian oil. We will continue to buy Iranian oil in this fiscal year,” an Indian Government official said on Thursday.

The Indian official, who is involved in discussions with US authorities, said Washington may announce a waiver on 4 November.

A Japanese oil market analyst who declined to be identified due to the sensitivity of the matter said Japan’s chances of winning a waiver would increase if India were granted one.

The Japanese Government and industry officials were hopeful of gaining an exemption, the analyst said.

A senior Japanese Trade Ministry official on Thursday declined to provide further details.

Japan joined South Korea in temporarily halting Iranian oil loadings, but three of Iran’s top five customers – India, China and Turkey – are resisting the call to end purchases outright, according to sources familiar with the matter. While China, Iran’s largest oil client, has halted lifting Iranian crude in November, Beijing is keenly awaiting word from Washington on a waiver the country is hopeful of winning.

“China has sought a full waiver, arguing that its refineries are configured to process Iranian oil, which can’t be easily and economically replaced by supplies from other producers,” said a State oil official with knowledge of the situation.

Japan imported about 172,000 barrels per day (bpd) of Iranian crude last year, down 24.2% from 2016, Trade Ministry data showed.

Japan has cut Iranian imports significantly from nearly 315,000 bpd in 2011, the year before the previous international sanctions on Iran were imposed.

Japan won waivers from the previous sanctions that allowed it to buy limited amounts of oil from Iran before the restrictions ended in 2016.

Chinese customs data released earlier on Thursday showed China’s Iranian oil imports in September fell by a third from a year earlier to 518,300 bpd, and compared to nearly 800,000 bpd in August.