Iran and its allies earn $1B annually through fuel oil smuggling: Report

[JACK AYLMER]

A fuel oil smuggling scheme is netting Iran and its allies at least $1 billion dollars per year, according to new reporting from Reuters.

The operation runs through Iraq, which has kept its alliances with both Iran and the U.S. It has allowed Iran to avoid U.S. sanctions, but also leaves Iraq vulnerable to facing U.S. sanctions of its own.

Iraq has a program allowing asphalt plants to receive fuel at heavily discounted prices. As many as 5 million barrels’ worth of heavy fuel oil are diverted away from the plants…  and sold mostly to countries in Asia instead.

Reuters reports companies and people in Iraq, Iran, and multiple other Gulf countries are involved in the scheme…. and say that, while fuel oil smuggling existed for years, this particular project grew after a new president took power in Iraq in 2022.

Iraq may soon be at a political cross-roads. Shi’ite Muslims backed by Iran are crucial to keeping Iraq’s government in power.

But U.S. President-elect Donald Trump wants to take a strict approach toward Iran. Tougher sanctions could be coming as Trump hopes to limit Iran from growing its nuclear program, and from supporting groups like Hamas and Hezbollah, who have been attacking Israel in recent years.

Reuters reports that some Iraqi officials are worried that Iraq could face sanctions for the oil scheme and other activities helping Iran get around U.S. sanctions.

For Straight Arrow News, I’m Jack Aylmer.

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