Turkey Clashes With U.S. Over Iranian Oil Imports

By Harriet Fildes

Turkey is still highly dependent on Iranian oil imports, despite being given a six month “exception” to the sanctions, alongside India, South Korea and China, amongst others. This was to give the countries time to diversify their energy sources which would enable them to “significantly reduce” their oil and natural gas imports from Iran or face punitive measures including being removed from the U.S. financial system.

The U.S law demands that states continue to decrease their imports every six months. However, Turkey’s failure to totally adhere to this law has provoked consternation in the White House. According to a statement in Hurriyet Daily News, a Senate aide raised the issue, asserting that “While I find it very hard to believe the U.S. State Department didn’t remind our Turkish partners that U.S. law requires them to continue significantly reducing toward a permanent end to Iranian imports, U.S. law stands whether they received a warning or not.”

Given Turkey’s winter fuel requirements and despite their increasing imports of Russian energy, the likelihood that Turkey will have the ability or the inclination to reduce purchasing over these harsh winter months is low. Turkey is arguing that these sanctions, and the expanded ones approved by the U.S. senate on Friday, do not apply to them. As Iran’s largest natural gas consumer, Turkey poses a real challenge to the United States ability and legitimacy to impose such regulations.

Erdoğan has stated unequivocally that Turkey will continue to import these energy resources, informing both Tehran and Washington of this plan. Furthermore, to pay for these continued imports Turkey is having to convert lira into gold due to sanctions preventing them from transferring money into the country. This additionally violated the sanctions against supplying Iran with precious metals.

The U.S. fears Iran is enriching uranium in order to build nuclear weapons and consequently, is placing diplomatic pressure on Turkey to adhere to the sanctions.

The Journal of Turkish Weekly interviewed energy security studies expert, Hasan Selim Özertem, regarding these developments, asking whether Turkey’s position regarding the sanctions is legitimate.

“It is totally legitimate because its not a United Nations Security Council resolution, it’s mainly a group of countries that have a stated a policy against Iran. There have been a number of resolutions accepted by the UNSC but they proved to be inefficient so the U.S. as part of its policy against Iranian proliferation, initiation a unilateral policy which is being followed by Americas allies. Turkey has started to diversify its oil imports and this year Taner Yıldız, the Minister of Energy, stated that Turkey will buy 15-20 percent less oil and this will continue to be decreased incrementally.”

Mr Özertem went on to explain the difficulties constraining Turkey and preventing them from adhering to U.S. regulations.

“The first problem is that Turkey cannot change its consumption activities over night as there is no surplus oil to be traded in the Mediterranean region although Libya just came back to the market. Secondly Turkey has signed some binding agreements with Iran which have to be fulfilled so as to avoid certain consequences of breaking these agreements in international courts.”

“On the other hand, Turkey is continuing to try and find some other ways to decrease oil imports from Iran so its started negotiations with Saudi Arabia and Russia. Here in turkey these energy deals are predominantly made by refinery monopoly TÜPRAŞ which, in the last decade, made significant investments to refine Iranian oil so it is also hard for them to change their consumption patterns overnight. Concurrently, this also means that this is not a state policy.”

“Apart from oil, one of the main areas of sanctions is on natural gas. Turkeys position is more critical in this area because Iran supplies almost 20 percent of Turkey’s natural gas demand, this is a 25 year agreement and its hard for Turkey to cancel this with Iran considering the constraints in the natural gas market in the region. So we have to make a differentiation here. Regarding oil, Turkey will continue to diversify but regarding natural gas, Turkey’s position should be respected because this will not just be sanctions against Iran but sanctions against Turkey if Washington insists on stopping gas imports.”

Consequently, the U.S. and Turkey remain engaged in diplomatic talks to find a mutually acceptable solution to this issue. As the U.S. Ambassador to Ankara, Francis Ricciardone stated, “How we go about this is something we have to work out together. There are no easy answers, but we all agree that diplomacy is the way to go.”