Energy Analyst gives 6 reasons why EU will resist folding to US pressure on Iran
17 mai 2018
I would say that Chinese investors are far more advanced in this regard than European ones. For European companies, it is a new issue. The US dollar has been linked to the oil trade for a very long time, so it's a very complex issue, and it will take some time for the Europeans to study it carefully and to take decisions. The European Union is not yet at this stage [at present].
What implications could the abandonment of the dollar in oil trade have for the US currency, and subsequently for Washington's global economic clout? What's your assessment of the potential damage?
The implications would be important. We know well that there are very strong links between US economic power and the role of the dollar. It has been the case for decades.
But it is a little early to be specific about these potential impacts. Let's remember that the OPEC countries discussed several times various options about payment for their oil exports over a period of many years. At the end of the day, they kept the US dollar; so it's not yet a done deal.
Europe has not caved so far under US pressure. It's very interesting what's going on at the moment between Europe and the US. Why have the European nations proposed to maintain trading with Iran despite Washington's ultimatum?
The European countries are convinced that the nuclear deal with Iran is a very important and useful agreement, [one] that is respected by Iran…You do not abandon something which is working very well, even if of course it is not perfect; but nothing is perfect, at least on this earth.
EU foreign policy chief Federica Mogherini has said that Europe and Iran have agreed to come up with practical solutions in response to Washington's move in the forthcoming weeks. What could Mogherini's response be, in your view?
Several options are being considered. They are the following: First, to forbid European companies from complying with US sanctions. The second option is to push the European Investment bank to be involved in EU trade with Iran and EU investment in Iran. A third option would be for European countries to extend credit lines to Iran in order to develop trade with this country and European investment in this country.
A fourth option for the EU would be to sanction US companies if the US administration decided to sanction European companies which are involved in trading and investment activities in Iran. Another, and perhaps final option, would be to negotiate exemptions for European companies and interests with the US administration.
The US is of course a superpower. It's also an energy superpower, as it is now the leading liquids and gas producer in the world. If European companies such as Total in France, Shell in the UK and the Netherlands, Eni in Italy, Cepsa in Spain, etc. – if these companies have at the end of the day to choose between Iran and the US, they will choose the US. So it's a very difficult issue for the European Union when studying these various options which are on the table.