US to continue 'maximum pressure' against Iran, departing energy secretary says

Tehran is making necessary preparations to export within three months

Abu Dhabi, United Arab Emirates - Dan Brouillette, United States Deputy Secretary of Energy on the first day of the 24th World Energy Congress at ADNEC. Khushnum Bhandari for The National
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The US will continue its 'maximum pressure' campaign against Iran as it looks to restrict the country's ability to export oil before President-elect Joe Biden is sworn in next month, according to the outgoing US secretary of energy.

"The maximum pressure campaign of the United States started many years ago - two, three years ago - is going to continue," Dan Brouillette told reporters.

"We have seen terrorist activity in many cases, supported by either Iran or proxies of Iran around the world and until that activity stops and until that behaviour changes, I think you'll see the maximum pressure campaign being sustained. It's very important to us as we look around the world to see a stabilisation of the world oil markets," he said.

His comments came amid indications that Iran, which has seen its exports squeezed following the maximum pressure campaign by the Trump administration, is preparing to export again.

The incoming Biden administration is expected to favour a return of the US to the Joint Comprehensive Plan of Action, which previously allowed Iran financial relief in return for nuclear commitments. The US's rejoining of the nuclear deal will depend on Tehran's return to full compliance with the stipulations of the agreement, which it walked back on, following the unilateral withdrawal of the Trump administration from the accord in 2018.

Iranian President Hassan Rouhani earlier this month instructed his energy ministry to make necessary preparations to pump oil at full capacity and be ready for export in "three months".

The departing administration further squeezed Iran, imposing new sanctions targeting the country's nuclear, missile and conventional arms in September.

Estimates by Facts Global Energy in London suggest that Iran’s production has halved falling from 3.8 million barrels per day before sanctions to just below 1.9m bpd. Its exports, which averaged 2m bpd prior to the US sanctions against Tehran now average 200,000 bpd.

Iran continues to export oil, under different flag carriers and using ship-to-ship transfers.

Separately, Mr Brouillette said the US plans to bring on more liquefied natural gas export capabilities and is targeting more gas sales to Asia, as the region continues to see recovery in demand.

The US department of energy recently extended the terms of seven long-term liquefied natural gas export authorisations through to 2050, which Mr Brouillette said was done in anticipation of growing demand.

"We need for that demand to come back but when it does, we expect the United States, the UAE, we expect others to be right back in that marketplace, even for the production of electricity in certain cases or petrochemical products around the world so we know that that's going to happen," he said.