Iran surges in Venezuela in defiance of US sanctions

Iranian oil tanker Clavel crossing the Gibraltar stretch heading for Venezuela, May 20, 2020

Escorted by the Venezuelan navy and air force, an Iranian oil tanker named Fortune has entered that country’s waters on Sunday, amidst intense speculation whether the US would interfere with the delivery. The US has imposed oil sanctions against Venezuela and Iran and had said it is monitoring the Iranian tanker.

In fact, five Iranian tankers carrying about 1.5m barrels of fuel passed through the Suez Canal earlier this month, according to shipping data on Refinitiv Eikon, and were heading for Venezuela.  The other four Iranian tankers — Forest, Petunia, Faxon and Clavel — are approaching the Caribbean en route to Venezuela.

A flotilla of US Navy and Coast Guard vessels is patrolling the Caribbean Sea on a mission to counter illicit drug trafficking. But Pentagon has stated that there are no plans to stop the Iranian tankers.

At the same time, a Pentagon spokesman, Jonathan Hoffman, while saying on Thursday he was not aware of any operations related to the Iranian cargoes, also added, “We have continued to say that Iran and Venezuela – both two outliers in the international order – [are] clearly violating international sanctions on both nations with this transaction.”

The US sanctions on Venezuela are aimed at increasing pressure on President Maduro to step down. Thus, arguably, Iran is frontally challenging the Trump administration’s stated policy of ‘regime change’ in Venezuela. The Iranian move comes just three weeks after the abortive coup attempt masterminded by the White House on May 1 with the participation of two former US Green Berets aimed at capturing Maduro and transport him to the US in American helicopters to be put on trial on fake drug trafficking charges. 

The coup attempt showed the extent of desperation in Washington to overthrow the Maduro government before the US presidential election in November, which President Trump hopes would help him garner Hispanic votes. Iran has now offered a lifeline to Venezuela.

In a historical context, this becomes a frontal assault by Iran on the Monroe Doctrine dating back to the 19th century, which in US foreign policy calculus regarded the Western Hemisphere as its sphere of influence. According to a Reuters report, the Trump administration said earlier this month it was “considering measures” it could take in response to the Iranian shipments, without providing specifics. 

No doubt, this is a deliberate sanctions-busting enterprise by Iran. Venezuela desperately needs fuel for up to 1,800 gasoline stations that have been partially closed for weeks due to insufficient supply from state-run refineries.

Venezuela’s gasoline output is now limited to a single facility, the Amuay refinery, but most fuel produced is low octane as most of the country’s alkylation units are out of service. Imported alkylate could improve the quality of domestic gasoline. Venezuela’s refineries are in poor condition. Shipments of equipment in flights by Iran’s Mahan Air have arrived in Venezuela in recent weeks to start repair work.

It will be interesting to see whether the US Navy would interdict any of the other four Iranian tankers before they enter Venezuelan waters. Tehran has sternly warned the US that it would retaliate if any such attempt is made. On Saturday, Tehran raised the ante with President Hassan Rouhani explicitly warning, “If our oil tankers in the Caribbean Sea or anywhere else in the world get into trouble caused by the Americans, they (US) will run into trouble reciprocally.” 

Washington is well aware of Iran’s capability to create big problems for the US Navy deployed in the Persian Gulf, especially the Strait of Hormuz.   Last week, in a precautionary step, US Navy, via the Maritime Safety Office run by the National Geospatial-Intelligence Agency, alerted all international maritime traffic to maintain a safe distance of at least 100 meters from US naval vessels in international waters and straits. Pentagon officials separately confirmed that the stay-away warning to marine traffic in the Persian Gulf, the Arabian Sea and the Gulf of Oman was actually intended for Iran. 

In geopolitical terms, Iran’s strategic defiance of the US in the Western Hemisphere makes an interesting case study not only of the decline in American influence in its backyard to the south but the entire efficacy of the “sphere of influence” concept in contemporary world politics. This is one thing. 

More importantly, in the backdrop of the Iranian tanker reaching Venezuela, Caracas has described Iran as a “revolutionary partner” in the struggle against US imperialism. From the Iranian viewpoint, Venezuela becomes a part of the “axis of resistance” against the US. To be sure, the audacity of the two countries will irritate Washington to no end. 

How far the Iran-Venezuela axis will deepen and expand will bear watch. Importantly, the UN Security Council embargo against Iran exporting arms to other countries is expiring in October. The US move to extend the timeline of the embargo is unlikely to succeed, given the strong negative reaction by Russia and China. It is entirely conceivable that a matrix of military cooperation may commence in a near future involving Iran and Venezuela. 

Iran’s indigenously developed missile capability acts as a deterrent against US aggression. Iran has transferred missile technology to Hezbollah, which is estimated to have the capability today to inflict significant damage to Israel in the event of any aggression by the latter on Lebanon. Significantly, the deterrence is working and Israel no longer stages attacks on Lebanon. 

A similar shift in the strategic balance with Iran’s help can create more space for Venezuela to push back at the US. All in all, Iran appears to be working on a strategy to help Venezuela to maintain its strategic autonomy.  There is enormous potential for cooperation and coordination between Iran and Venezuela. If Venezuela has the largest known oil reserves in the world, Iran too has massive reserves of oil and gas. 

The despatch of oil to lubricate the beleaguered Venezuelan economy may prove to be the harbinger of an assertive Iranian power projection elsewhere in Latin America too. Surely, in the near term, it is a rebuff to the Trump administration’s maximum pressure strategy against Iran. In a longer-term perspective, a concerted regional strategy in Latin America by Russia, China and Iran can seriously erode the US influence in the continent.