Trump fires his Iran policy architect: Update 2

  • Market: Crude oil
  • 09/10/19

Updates throughout

US president Donald Trump today fired White House national security adviser John Bolton, a proponent of strong pressure tactics against Iran and Venezuela.

Trump said he and other administration officials disagreed strongly with many of Bolton's views. Bolton's "priorities and policies just do not line up with the president," the White House said.

"The president has the right to put someone who carries out his agenda" but that was no longer tenable with Bolton, a senior White House official said.

The final straw for the president came after he was forced to call off talks with the leaders of the Taliban insurgency, scheduled to take place at the presidential retreat at Camp David on 7 September. Bolton opposed the talks and the prospect of inviting Taliban leaders to Camp David just days before the 18th anniversary of the 11 September 2001 attacks drew rebukes even from Trump's loyalists in Congress.

Bolton, responding via Twitter after Trump's announcement, said he offered to resign last night and "President Trump said, 'Let's talk about it tomorrow.'"

More than any other individual, Bolton had laid out the case for the "maximum pressure" campaign against Iran through sanctions and diplomatic pressure even before becoming Trump's national security adviser in April 2018.

Bolton had argued that the pressure of unilateral US sanctions will either result in the overthrow of the Iranian government or force it to negotiate a new deal on US terms. He suggested that Trump ought to publicly discuss the prospect of talking with Iran after withdrawing the US from the nuclear deal, but only to address his allies' concerns.

Bolton's policy of maximum pressure has resulted in a near cutoff of Iranian crude exports, but it also has sparked a string of incidents on oil tankers and infrastructure in the Middle East. Iran has selectively stopped compliance with restrictions on its nuclear program. The two countries nearly came to a military confrontation in June, but Trump decided not to retaliate after Iran shot down an unmanned US military drone.

And Trump appears interested in negotiating with Tehran, rather than just going through the motions of a dialogue. At the suggestion of French president Emmanuel Macron, Trump has floated the possibility of meeting Iranian president Hassan Rohani at the UN General Assembly later this month, even though the US insistence on maintaining oil sanctions on Iran makes the meeting unlikely.

Trump also seems open to discussing the French proposal to provide an economic lifeline for Tehran by oil-backed loans from the remaining participants of the nuclear deal, in return for Iran's return to full compliance with that agreement.

But US secretary of state Mike Pompeo and treasury secretary Steven Mnuchin insisted today that the "maximum pressure" policy will not change despite Bolton's departure — even though both appeared visibly satisfied at the news.

"The president has made clear he is happy to take a meeting with no preconditions, but we are maintaining the maximum pressure campaign," Mnuchin said at a news briefing shortly after Bolton's termination was announced. Mnuchin and Pompeo announced a consolidation of several existing sanctions programs to better target groups Washington considers terrorist, including Iran's Islamic Revolutionary Guard Corps and its component Quds Force in this category alongside extremist groups Isis and Al-Qaeda in a calculated slight to Tehran.

Pompeo cited his own disagreements with Bolton and said that Trump "should have people that he trusts and values and whose efforts and judgments benefit him in delivering American foreign policy."

Bolton's equally confrontational approach to force out Venezuelan president Nicolas Maduro has not worked out so far. The US recognizes Venezuelan National Assembly speaker Juan Guaido as the country's interim president. US sanctions in place have cut off Venezuela's primary export destination, forcing that country to redirect its crude exports to China and India.

Mnuchin said the Venezuela policy will not change. "We have a massive sanctions program that is working."

Bolton was Trump's third national security adviser. The first, Michael Flynn, resigned after less than a month in the office and is awaiting sentencing after pleading guilty to lying to the FBI about his contacts with the Russian ambassador in Washington in 2016. Flynn's successor HR McMaster lasted 13 months on the job before Trump forced him out in March 2018 to pursue a more confrontational course on Iran.

Trump said he would appoint a new national security adviser next week. Bolton's deputy Charlie Kupperman, formerly an executive at Boeing and Lockheed Martin, will serve as acting national security adviser.

Pompeo may not serve until the end of Trump's term in office either. Senior Republicans are pushing him to run for the Senate from Kansas next year, and Pompeo has until June 2020 to make the decision. Pompeo has not ruled out his candidacy, while insisting that he will continue to serve as secretary of state as long as Trump keeps him on board.


Sharelinkedin-sharetwitter-sharefacebook-shareemail-share

Related news posts

Argus illuminates the markets by putting a lens on the areas that matter most to you. The market news and commentary we publish reveals vital insights that enable you to make stronger, well-informed decisions. Explore a selection of news stories related to this one.

News
02/23/24

Panama urges fleet to avoid Red Sea, keep AIS on

Panama urges fleet to avoid Red Sea, keep AIS on

New York, 23 February (Argus) — The Panama Maritime Authority said today it "strongly recommends" all Panama-flagged vessels avoid transiting the Red Sea because of the increasing threat of Houthi attacks on commercial vessels, while warning vessels against turning off their automatic identification system (AIS). Some ship operators have chosen to disable their vessel's AIS to avoid detection by the Houthis with varying levels of success when transiting the region. That puts these vessels out of compliance with "international requirements related to position reporting," the authority said in a notice. More than 120 commercial and private vessels flagged by Panama were transiting the Suez Canal, the Red Sea, and the Gulf of Aden on Friday, according to vessel tracking data reliant on AIS. "All vessels hoisting the Panama flag before, during and after transiting the Red Sea, Gulf of Aden and Persian and their approaches must keep the AIS and long-range identification (LRIT) on except in those cases in which the captain considers that the safety of the vessel could be compromised or when a safety incident is imminent," the notice said. "The Panama Maritime Authority may sanction violations of such provisions in accordance with national legislation, if they do not formally report through LRIT and AIS to our administration at the appropriate time." The authority said the Bahamas-flagged vessel Galaxy Trader had operated without its AIS for 24 hours, traveling 250 nautical miles through the region, before being attacked by Houthis anyway. For vessels continuing to transit through the region, recommendations by the authority include traveling by night to avoid detection and installing searchlights to scan for the small vessels that likely act as spotters, the appearance of which have preceded Houthi missile attacks . But traveling by night comes with another risk. "At night, small and slow boats without a wake are difficult to detect on radar," the authority warned. "Don't stop if threatened and present a challenging target through proactive maneuvers." The Panamanian flag is flown by the plurality of flagged ships in operation at 17pc of the global fleet, represented by over 8,000 vessels, according to the state-owned Panama Ship Registry. By Ross Griffith Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Read More
News

Fire breaks out at S-Oil's Onsan plant in South Korea


02/23/24
News
02/23/24

Fire breaks out at S-Oil's Onsan plant in South Korea

Singapore, 23 February (Argus) — A fire broke out at South Korean private-sector refiner S-Oil's Onsan plant on 23 February, affecting operations at a crude distillation unit (CDU). The fire broke out at a pump linking refinery units. The 580,000 b/d Onsan plant's 250,000 b/d No.3 CDU was impacted, sources close to the refiner said. No casualties have been reported thus far. Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

News

Canal disruptions spur fast steaming: UN


02/22/24
News
02/22/24

Canal disruptions spur fast steaming: UN

New York, 22 February (Argus) — Ship operators are increasingly speeding up their vessels to offset the lengthier voyages around the Cape of Good Hope necessary to avoid the conflict-afflicted Suez Canal and drought-plagued Panama Canal, according to a UN Conference on Trade and Development (UNCTAD) report published today. "The disruption in the Red Sea and Suez Canal, combined with factors linked to the Panama Canal and the Black Sea and leading to rerouting vessels through longer routes are causing vessel sailing speeds to increase," the UNCTAD said. "This is a means for ship operators to ensure schedule integrity and manage the fleet capacity." The jump in steaming speeds is a departure from record slow steaming speeds hit last year among the dry bulker segment as shipowners attempted to reduce emissions per the International Maritime Organization's (IMO) new environmental regulations, which kicked off in 2023. "An increase from 14 to 16 knots would increase ship (fuel oil) consumption per mile by 31pc," the UNCTAD said. "These trends could erode the environmental gains that had been achieved through slow steaming." The Argus -assessed carbon cost of freight (CCF), which ship operators have to pay to comply with the EU ETS, of a 65,000 dwt long range (LR1) refined products tanker traveling from Ras Tanura in the Middle East to Rotterdam was at 46¢/t on Wednesday, assuming a Suez Canal transit under nominal conditions, for a lumpsum of $30,223. The same fee to shipowners could hit as high as 96¢/t, or $62,129 lumpsum, assuming a 31pc increase in consumption from a two-knot increase in speed alongside the additional two weeks of travel time to avoid the Suez Canal around the Cape of Good Hope. Traders shift to rail Some traders looking to move commodities between the Atlantic and Pacific basins are adjusting their focus away from seaborne routing altogether, with rail traffic jumping in the US since the start of the year because of the rising danger near the Suez Canal and the ongoing drought restrictions at the Panama Canal, according to the UNCTAD. "In the United States, demand for rail transport services has surged as a result in recent weeks, as shippers no longer have the option of going through the Suez Canal as an alternative to the Panama Canal," the UNCTAD said. "The land bridge, which connects the ports of Los Angeles and Long Beach in the United States by rail with the wider North American hinterland, is the other main competitor for the Panama Canal." The move mirrors major container shipping giant Maersk, long a preferred client of the Panama Canal because of the large amount of traffic it pushed through the waterway, choosing earlier this year to halt many Panama Canal transits in favor of discharging two separate vessels on either side of Panama and swapping their cargoes by rail instead. West coast South America countries like Chile, Peru and Ecuador funnel 22pc, 22pc and 26pc of their total foreign trade volumes through the Panama Canal, according to the UNCTAD, and buyers in these countries of refined oil products like diesel and gasoline sourced from the US Gulf coast will need to continue to vie for booking slots at the Panama Canal in the absence of a rail connection. Those without slots will need to win auctions, which jumped above $500,000 lumpsum in early February per Argus assessments for the medium range (MR) tankers utilizing the Panamax locks, to secure passage. By Ross Griffith Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

News

Teekay sees volatile 2024 in tight tanker market


02/22/24
News
02/22/24

Teekay sees volatile 2024 in tight tanker market

Houston, 22 February (Argus) — Persistent volatility and increased long-haul trade across the globe will support crude tanker rates this year amid a stretched and aging global fleet, midsize tanker specialist Teekay said today. Increased long-haul crude trade flows from the Americas to east Asia, as well as continued shipments from Russia to India and China, likely will increase tonne-mile demand in 2024, Teekay chief executive Kevin Mackay said Thursday on an earnings call. With oil demand growth concentrated in Asia-Pacific and oil production growth led by the US, Brazil and Guyana, voyages between the two regions are expected to increase, he said. Route diversions due to Houthi attacks in the Red Sea are also expected to increase tanker demand, especially for Suezmaxes, Mackay added. A Suezmax voyage from Iraq to the Mediterranean is about 4,000 nautical miles, or 13 days, via the Suez Canal, compared with about 12,000 nautical miles, or 40 days, via the Cape of Good Hope, he said. The 590,000 b/d Trans Mountain Expansion (TMX) oil pipeline project, expected to come online in the second quarter of 2024, will create additional Aframax demand in Vancouver, British Columbia, Mackay said, but it is uncertain where the increased cargoes will land. "We'll have to wait and see how the oil trading environment picks up on that oil and where they can probably make the best margins," Mackay said. "The only sure thing is that you can only load an Aframax out of Vancouver." Yearly profits double Teekay reported a profit of $111.7mn in the fourth quarter, down from $146.4mn in the same period in 2023 after rates fell year on year and the company had more vessels dry docked. Still, full-year profit more than doubled to $513mn, up from $229mn in 2022. Teekay operates a fleet 42 tankers — 25 Suezmax tankers and 17 Aframax or Long Range 2 tankers. By Tray Swanson Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

News

Indonesia’s PIS issues spot Suezmax freight tender


02/22/24
News
02/22/24

Indonesia’s PIS issues spot Suezmax freight tender

Singapore, 22 February (Argus) — Indonesia's Pertamina International Shipping (PIS) has issued a spot Suezmax vessel freight tender to move 1mn bl of crude oil for late-March loading. PIS — a wholly-owned subsidiary of Indonesian state-owned refiner Pertamina — is seeking a vessel loading from Girassol, Angola to two discharge ports in Indonesia's Balongan and Balikpapan, with 21-22 March loading dates. The tender will close at 6pm Singapore time (10am GMT) on 22 February with validity until 7.15pm. The shipment can have a maximum unavoidable transportation loss of up to 0.07pc, according to the tender. Suezmax shipment rates from west Africa towards India have fallen from this year's high. Argus- assessed lumpsum rates for 130,000t shipments from the west Africa region to the east coast of India fell to $4.5mn on 21 February, from $5.7mn on 10 January. Suezmaxes especially are choosing to stay in the Mediterranean and northwest Europe after discharging in Europe instead of going to west Africa or the US Gulf, where high vessel supply and limited activity continue to weigh on rates. By Sean Zhuang Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.