WASHINGTON: US President Donald Trump said that China can continue to purchase Iranian oil after Israel and Iran agreed to a ceasefire, a move experts said indicates a return to lax enforcement of U.S. sanctions.
“China can now continue to purchase Oil from Iran. Hopefully, they will be purchasing plenty from the U.S., also,” Trump said in a social media post .
His remarks came hours after Israel agreed to halt its aggression against the Islamic Republic, as Trump showed reluctance in further American involvement in the war.
Meanwhile, oil prices continued to drop and markets surged Tuesday as Trump pushed Iran and Israel into accepting a precarious ceasefire agreement.
The agreement has curbed concerns that Iran would shut down the Strait of Hormuz, a key trade route for shipping oil across the globe.
Crude hit $65 per barrel in extended trading after West Texas Intermediate crude futures fell more than 8% to about $67 per barrel on Monday afternoon. Brent crude, the international benchmark, fell to $70 a barrel.
Washington reinstated sanctions on Tehran in 2018, and Trump’s administration has imposed several new rounds of sanctions on Iran’s oil trade since taking office in January.
Trump’s sanctions had included penalties on three Chinese oil import companies, which led to curtailed buying.
Last week, industry experts warned that Iran shutting down the Strait of Hormuz could cause prices to surge to as much as $120 a barrel.
Roughly 20% of the world’s oil supply travels through the strait.
