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Posts Tagged ‘Zhuhai Zhenrong’

Can China Benefit From Growing U.S.-Iran Tensions?

Posted by Ram Kumar Shrestha on January 16, 2012

By AUSTIN RAMZY

U.S. efforts to reduce global demand for Iran’s oil exports as a means to pressure it into curbing its nuclear ambitions could present major problems for China, the leading customer of Iranian crude exports. China reacted strongly over the weekend to U.S. sanctions on Zhuhai Zhenrong, a Chinese firm the U.S. calls the largest supplier of refined petroleum to Iran. (Although a major petroleum producer, Iran is dependent on gasoline imports due to limited domestic refinery capacity.) Those imports violated U.S. law, the U.S. State Department says, and as a result Zhuhai Zhenrong is “barred from receiving U.S. export licenses, U.S. Export Import Bank financing, and loans over $10 million from U.S. financial institutions.”

The Wall Street Journal reported that the company appears to have no U.S. assets, so the sanctions are “largely symbolic.” But they raised the ire of the Chinese government. On Saturday Chinese Foreign Ministry spokesman Liu Weimin called U.S. efforts to internationalize its  sanctions against Iran by target a Chinese company were “completely unreasonable and don’t conform with the spirit or content of U.N. Security Council resolutions,” according to a statement (in Chinese) posted on the ministry’s website.

Last week U.S. Treasury Secretary Timothy Geithner visited Beijing, seeking to convince China to back further sanctions against Iran. Last month President Obama signed legislation that would block firms that deal with Iran’s central bank—the key processor of oil receipts—from the U.S. financial system. Exceptions would be made for states that significantly reduce crude oil purchases from Iran. Japan, a major importer of oil from Iran, said it would support the U.S. measure. But China responded cautiously. Vice Foreign Minister Cui Tiankai said ahead of Geithner’s visit that China’s oil imports should be considered separately from the dispute over Iran’s nuclear program. Read the rest of this entry »

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