New Port for Oil Export .. Signs of Iranian Escalation in Hormuz Strait

Thursday, Iran opened the first oil port on the Gulf of Oman, in an attempt to get out of the tension in the Strait of Hormuz, and save oil from any confrontation that could occur there because of officials’ threats.

Analysts believe that Tehran is seeking through the new port, to avoid being a victim of itself when the state decides to close the strait, as a suicidal step, that the hardliners who control the military establishment would take, especially in light of the failure of the dialogue on the nuclear deal.

Outgoing President Hassan Rouhani announced on Thursday the start of work on the 1,000-kilometre-long oil pipeline from Kureh in the southwest to Jask, in the southeast of the country, and the operation of the export platform in the Makran region.

This line allows Iran to transport crude oil from the Kureh region to the Jask port on the Oman Sea, thus avoiding the transit of tankers in the Gulf waters and the strategic Strait of Hormuz. Exporting from the Jask port also allows tankers to save a few days of transportation, without the need to cross the Strait of Hormuz, through which a fifth of global oil exports pass, and has previously constituted a point of tension, especially between Iran and US.

Export insurance

Masoud Khalil, a researcher and specialist in Iranian affairs, opines from a strategic point of view, the new line will give Iran the ability to continue exporting its oil, if the Strait of Hormuz is closed for any reason. Khalil points out that the new line shortens the distance for those who want to import oil so that their tankers do not have to travel a longer distance to the Gulf waters.

Khalil does not rule out an escalation of tension in the Strait of Hormuz, especially as Tehran evades U.S. sanctions and the failure of negotiations on the nuclear file. He also asserts that Iran realizes that it may getting involved in a war in the near future that could stop export traffic in Hormuz, while the new line will be safe for it.

“Iran seeks to export millions barrels of oil that it has extracted and stored, if it reaches an agreement with US on its nuclear program, as it has recently worked on transporting oil in preparation to resume putting it on the market,” khalil adds.

It is noteworthy that Iran has the fourth largest oil reserves in the world and depends heavily on oil revenues. Iranian Oil Ministry officials have said that Tehran intends to increase production from 2.1 million barrels per day to 3.8 million barrels per day, if the administration of US President Joe Biden and the Iranian government reach an agreement.

In mid-June, Washington and Tehran began a sixth round of direct talks to revive the nuclear deal signed in 2015 from which Donald Trump, the former US president, withdrew in 2018 and re-imposed sanctions on the Iranian energy sector. This prompted Refining Companies in several countries to avoid Iranian crude oil, forcing Tehran to reduce its production to levels far below its capacity.

However, negotiations stalled after hard-liner judge Ebrahim Raisi won the Iranian presidential elections.

Emergency port

Iranian officials have repeatedly threatened to close the Strait of Hormuz. Observers believe these threats aim to appease the hard-line public, which still adopt the slogans of Khomeini’s revolution, and who may turn against the regime if abandons it. The threats also aim to galvanize the movements loyal to Iran in the region to continue their operations.

In this context, Fayez al-Samrah, a political analyst, expects Tehran to riot in the Strait of Hormuz, if negotiations on the nuclear deal continue to fail and internal protests escalate in the country. He also indicates that Tehran’s choice of the  of when to start port’s work carries messages to the US ensuring that the new presidency may implement its threats and close the strait at any moment, while Tehran guarantees to export its oil during the period of closing the strait through the new line or what he calls the “emergency port.”

It should be noted that the threat to close the Strait of Hormuz was previously issued only by some Iranian officials. Tehran was the only party that deployed naval mines near the port of Hormuz in the 1980s with the aim of impeding maritime navigation there.

There have been many events in Strait of Hormuz, as Iraq and Iran sought, during their war between 1980 and 1988, to obstruct the other country’s oil exports in what was known at that time as the tanker war.

In July 1988, the US warship Vincennes shot down an Iranian airliner, killing all 290 people on board. Washington said it was an accident, while Tehran said it was an intentional attack.

In early 2008, the United States said that Iranian boats had threatened three US Navy ships in the strait.

In 2019, four ships, including Saudi oil tankers, were attacked off the coast of the UAE near Fujairah outside the Strait of Hormuz, and Iran was accused of being behind those attacks.

Al-Samrah believes that it is possible that the coming weeks and perhaps months will witness events like the previous one in the strait. He points out that the tension in Hormuz will be in the interest of Tehran, which will try to use it on the nuclear file negotiations , in addition to attract the protesting citizens’ attention internally to external issues, which will enable Iran to avoid the consequences of continued protests.

A symbolic and propaganda move

Bassam Al-Ali, a specialist in Iranian affairs, says that Tehran’s decision to close the strait will cause problems and reactions that may threaten the survival of the regime which suffers from internal social and economic problems, the latest was the widespread protests in Ahvaz regarding the water crisis.

Al-Ali also considers Iran’s resort to the Jask port to be more a symbolic and propaganda move than a realistic and practical one, as it will not exempt Tehran from the sanctions that affect it and the countries importing Iranian oil.

It is noteworthy that the Strait of Hormuz connects the Gulf with the Arabian Sea and the Indian Ocean, and is a major passage for oil and trade between the Gulf and Asian countries.

In addition to crude supplies, billions dollars of non-oil trade materials pass through the Strait of Hormuz, making the strait one of the most important shipping routes in the world.

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