Iran Prepares for Possible Oil Sanctions as Trump Plans ‘Maximum Pressure’ Campaign

Iran is bracing for potential additional sanctions on its oil exports, with the country’s Oil Minister Mohsen Paknejad assuring that "required measures" have been taken to deal with any upcoming restrictions. The announcement comes amid reports that President-elect Donald Trump intends to ramp up his "maximum pressure" campaign against Iran, seeking to isolate Tehran further and hinder its ability to support its Middle Eastern proxies.

During his first term in office, Trump withdrew the U.S. from the Joint Comprehensive Plan of Action (JCPOA), commonly known as the Iran nuclear deal, and re-imposed sanctions on Iran’s oil industry in 2018. Now, with Trump set to return to office, analysts believe that stricter sanctions could stifle Iran’s oil exports, which had just reached a six-year high earlier this year.

The potential impact of these sanctions on global oil markets is significant. Analysts warn that a major drop in Iranian oil exports could push oil prices higher, assuming other factors remain constant. However, the possibility of Trump also introducing import tariffs could slow down global economic growth and, in turn, reduce oil demand.

One key player in the Iranian oil market is China, which remains Tehran’s largest oil customer, purchasing over 90% of Iranian oil at discounted prices. Any disruptions in Iran’s oil exports would likely affect China’s energy strategy as well.

Libya’s Oil Disruption Amid Political Tensions

In Libya, another major oil-producing nation, protesters have shut down critical oil distribution valves in response to the kidnapping of a senior intelligence officer, Brigadier General Mustafa al-Whayshi. The valves, which connect the Sharara and El Feel fields to the Zawya refinery, account for roughly a third of Libya’s daily oil production, amounting to 350,000 barrels.

The kidnapping, which remains unclaimed, has caused unrest, with protesters blaming the Tripoli government for its failure to respond effectively. Intelligence officers have speculated that the abduction is linked to national security investigations involving militias and corruption.

This latest disruption follows a previous blockade of oil fields imposed by the Libyan National Army (LNA), which had led to a significant dip in production. After a political settlement between the rival governments in Libya, oil production was able to recover, hitting 1.3 million barrels per day by mid-October. The recovery was bolstered by the return of major Western energy companies, including Eni, BP, Repsol, and OMV, which are resuming drilling operations in Libya despite the country’s unstable political environment.