Iran-Korea, Japan and China Fall in Line

Under pressure from the US, some of the top Asian economies are reluctantly looking for options to reduce the amount of oil they buy from Iran.

The decision by South Korea and Japan to try to accommodate Washington’s demands followed reports that China had already reduced its purchase of Iranian crude in the past month in a pricing dispute with Tehran.

China, Japan, India and South Korea together import more than 60 per cent of Iranian oil exports, and they all depend on Iran and other Gulf producers for the preponderance of their oil and natural gas needs.

For Tehran, which relies heavily on oil revenues to prop up an economy battered by years of sanctions, the potential cutbacks by Asian customers follow a decision by the European Union to move toward a ban on the import of Iranian oil.

The sanctions exempt food, medicine and other humanitarian trade and include a presidential waiver for any country or company in cases in which the effects would harm the national security interests of the US.

Treasury secretary Timothy F Geithner is scheduled to visit Beijing and Tokyo this week, and the tightening sanctions on Iran will be high on his agenda.