The Atlantic Council, an American think tank, in a report emphasized that U.S. President Donald Trump’s gamble on Iranian oil exports may not play out the way he expects and Trump’s ultimatum would lead to more disgrace for him in the international scene.

The Atlantic Council reports says, “Trump Administration has announced it would not grant any exemption to its May 2 deadline and it means those six countries whose refineries are suitable for Iranian oil imports have to shut down.

Studies and evaluations show that Trump Administration has boasted its capability for imposing its sanctions and sudden elimination of over one billion barrels of Iran oil from the market. According to the U.S. State Department evaluation, over one million barrels of Iran oil enter the international market per day.

This political ultimatum is publicized in a condition that there is no joint common understanding among the governments which are themselves struggling with fuel supply and its transportation process because there are no preparations for refineries, vessels, insuring companies, agents or financers and bankers which are facing with this threat and the threat would be actually in vain. And Trump Administration can be itself victim of his gamble-like and uncalculated behavior and can show its immaturity.

Even at its best, the Trump Administration would face with a series of tough options. Even if the U.S. becomes successful in encouraging purchasers not to buy Iran oil and it can stabilize oil market, some part of Iran’s crude oil will enter the market. At that time, the U.S. government will be tangled in a difficult situation because it will be forced to choose between imposing its Secondary Sanctions on its allied companies and world powers like the UAE and China, or finding other solutions for those which skirt the sanctions.

No matter what is the result, the Trump Administration has a difficult job ahead and probably it would not have flexibility or necessary options which it had in sight for such a condition might happen in way of sanctions.

The sanctions in question grew out of legislation passed at the end of 2011 under the presidency of Barack Obama. The United States was expanding so-called “secondary sanctions” on Iran, meaning the threat of sanctions against third-country companies for engaging in certain transactions involving Iran, particularly its oil sector.

The 2012 National Defense Authorization Act (NDAA), signed into law in 2011, included a provision requiring the president to restrict the opening of correspondent or payable-through accounts by a foreign financial institution determined to have knowingly conducted or facilitated any significant financial transaction with the Central Bank of Iran or another designated Iranian financial institution.

The Trump administration and Congress adopted the same Significant Reduction Exception into numerous subsequent sanctions, including the threat of sanctions on any person engaged in a significant transaction for the acquisition of Iranian petroleum products.

And this is the same strategic mistake which makes Iran to employ secret and accurate transaction techniques in the winding oil market and it will seal Trump’s loss in the gamble.

By: Hamid Reza Naghashian