Iran says it may halt oil sales to 'some countries'

Iranian oil refinery Oil exports are one of the biggest sources of revenue for Iran

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The dispute between Iran and the Western economies has escalated after Tehran warned it will stop oil sales to "some countries."

Rostam Qasemi, Iran's oil minister, said the curbs will be implemented soon but did not mention specific countries.

The warning comes just days after the European Union (EU) agreed to stop importing Iranian oil from 1 July.

The US and EU have been trying to target Iran's oil exports as part of sanctions against it.

"Soon we will cut exporting oil to some countries," Mr Qasemi was quoted as saying by the state news agency IRNA.

'Arm twisting'

The EU agreed to stop importing all oil from Iran on 23 January. However, the embargo is scheduled to come into place only on 1 July so that member states have enough time to find other sources of oil.

Start Quote

Iranian oil has its own market, even if we cut our exports to Europe”

End Quote Rostam Qasemi Oil minister, Iran

Analysts said that if Iran stopped selling oil to some EU nations on a short notice, it may create problems for the affected countries.

They said that Tehran was using this tactic in a bid to ease pressure on itself.

"I think this is a case of arm twisting. They are trying to turn around the conditions for negotiations," said Ker Chung Yang of Phillip Futures.

Mr Ker noted that despite all the rhetoric, the threat was unlikely to have any significant impact.

"I don't think this is going to work as they have a history of not following up on any extreme measures that they warn against."

Iran's parliament postponed a debate on a proposed law seeking ban of all oil exports to the European Union.

'Its own market'

Oil exports are one of the biggest sources of income for Iran. The US and EU have been trying to curb those in a bid to force Iran to agree to stop its nuclear programme.

The EU currently buys about 20% of Iran's oil exports. However, Iran's oil minister said that a cut in exports to the region will not hurt Tehran.

"Iranian oil has its own market, even if we cut our exports to Europe," Mr Qasemi said.

The biggest market for Iran's exports is Asia, with China, India, Japan and South Korea currently the biggest buyers of oil. The US has been trying to convince these nations to side with it, but so far Japan is the only country that has openly voiced its support.

Meanwhile, India has made it clear that it is not looking to reduce its supplies just yet.

"It is not possible for India to take any decision to reduce the imports from Iran drastically, because among the countries which can provide the requirement of the emerging economies, Iran is an important country amongst them," India's Finance Minister Pranab Mukherjee told reporters during a visit to the United States.

China, the biggest buyer of Iranian oil, is also unlikely to cut supplies, given the country's growing demand for energy.

Graphic image showing Iran's top oil export destinations

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