Why Iran and Russia can dodge Western sanctions
Iran has been living with Western sanctions for almost 40 years, and never have so many sanctions been imposed so quickly as against Russia. Although their effect is limited, there is little alternative.
Iran knows it, China knows it and apparently, so does the US government: despite existing sanctions against the oil industry of the Islamic Republic, oil from Iran is being shipped to China in record volumes.
Javier Blas, an opinion columnist who covers energy and commodities for Bloomberg, recently described how Iranian oil ends up in China.
“If you believe the Chinese government, the country doesn’t import any oil from Iran. Zero. Not a barrel. Instead, it imports lots of Malaysian crude. So much that, according to official Chinese customs data, it somehow buys more than twice as much Malaysian oil as Malaysia actually produces.”
By rebranding Iranian oil, Malaysia became China’s fourth-largest foreign oil supplier last year, behind Saudi Arabia, Russia and Iraq.
For many years, Iran has used the United Arab Emirates (UAE) as a hub for circumventing sanctions. Dubai, one of the seven emirates of the UAE, is the gateway of banned goods other than oil that enter Iran. Tehran has long modified its supply chains so that virtually everything embargoed by the United States or the European Union can be obtained through trading and financial hubs like Dubai.
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The former Soviet republics in Central Asia have been proving ideal for circumventing the embargoes, because countries like Kazakhstan or Kyrgyzstan are part of a customs union with Moscow. Moreover, the vast distances — Kazakhstan alone shares a border with Russia of more than 7,500 kilometers (4,660 miles) — make sanctions control virtually impossible.
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