The U.S. government has agreed to let eight countries, including close allies South Korea and Japan, as well as India, keep buying Iranian oil after it reimposes sanctions on Tehran from next week, Bloomberg reported on Friday, citing a U.S. official.
The US plans to re-impose oil-related sanctions on Iran on November 4 to choke the Islamic Republic's biggest source of income and pressure it to renegotiate a new nuclear deal.
China is now the largest importer of Iranian oil, and after it was reportedly revealed that India, China and Turkey would be included in the 8 nations that would be granted waivers, crude oil prices fell to more than 6-month lows on Friday morning.
Secretary of State Mike Pompeo has confirmed earlier reports that eight nations will receive exemptions from the reimposed penalties, but refused to name them and said the European Union was not among them.
The countries that will be receiving the waivers will be allowed to pay for the oil using escrow accounts in their local currency, which will help the United States to regulate the revenues that Iran receives and only allow them to be used to buy food, medicines and other non-sanctioned goods from its customers.
China and India are highly dependant on Iran for its oil supply with the former being the leading importer of their oil in the world.
Mnuchin also signaled that Swift, the global financial messaging system, could be subject to sanctions if it doesn't comply with USA sanctions by handling transactions with Iranian institutions in violation of restrictions.
Bolton insisted, however, that even if some exceptions were granted, Iran is already feeling pain from the US sanctions, particularly with the collapse of its currency, the rial, this year. These sanctions are a pressure tactic to constrain Iran's nuclear programme.
Already, through its pressure campaign, the US has managed to reduce Iran's oil exports from 2.7 million to 1.6 million barrels a month, according to internal USA estimates.
Trump said that in addition to the November sanctions, the U.S.
That's symbolically important to the Trump administration because President Barack Obama's administration took three years to remove 1.2 million barrels from the market - and that was while acting in concert with the European Union and other nations before the global effort yielded the 2015 deal. But we are prepared to work with countries that are reducing their imports on a case-by-case basis. Every country that gets a significant reduction exemption (SRE) has to make a large reduction in order to secure one and will have to make further import cuts in the coming months.
"It seems that the United States has no more capability to put countries and global economic enterprises under pressure", the Iranian spokesperson added.