Tehran: A senior Iranian oil official said on Wednesday a move by U.S. lawmakers to target the Islamic Republic with fuel sanctions would not cause any problems because Tehran had many suppliers.
On Tuesday, the U.S. House of Representatives approved legislation to impose sanctions on foreign companies that help to supply fuel to Iran, a measure lawmakers hope will deter the country from pursuing its nuclear program.
"They cannot succeed," said Hojjatollah Ghanimifard, vice president of investment affairs at the state National Iranian Oil Company. "We have a long list of suppliers of gasoline," he told Reuters.
Iran is the world`s fifth-largest oil exporter, but lacks sufficient refining capacity to meet domestic fuel needs, forcing it to import up to 40 percent of its gasoline consumption.
This burdens the budget and also makes it vulnerable to any punitive measures that targets the trade, although Iranian officials have repeatedly shrugged off the impact of sanctions imposed over its disputed nuclear ambitions.
The House bill authorizes President Barack Obama to levy sanctions on energy companies that directly provide gasoline to Iran, along with the firms that provide insurance and tankers to facilitate the fuel shipments. The Senate is likely to approve a similar bill, but it is uncertain how soon it will vote.
The legislation would expand an existing U.S. law that seeks to punish foreign companies that invest more than $20 million a year in Iran`s energy sector. The sanctions include preventing companies in violation from getting financial assistance from U.S. institutions such as the Export-Import Bank.
Western firms have become increasingly wary of investing in Iran due to the row over its nuclear work, which the West fears is aimed at making bombs, although companies from energy-hungry Asia are seen as less susceptible to such pressures.
Iran denies the charge and says it needs nuclear power plants to generate electricity so that it can export more oil and gas.
As the United States has stepped up pressure on firms doing business with Iran, a number of past suppliers such as BP and Indian refiner Reliance have backed away from providing fuel.
But imports have largely been maintained as companies such as European trading firms Trafigura and Vitol, Kuwait-based International Petroleum Group and Malaysia`s Petronas step into the breach, traders have said.
"We can receive the amount of gasoline we need," said Ghanimifard. "We do not even bother about these kind of sanctions."
Some energy experts have said fuel sanctions on Iran would raise prices but not stop supplies because the country has porous borders and a history of smuggling petroleum products.
If a similar bill passes the Senate, the final legislation would impose the harshest sanctions yet approved by Congress to protest Iran`s nuclear program.