U.S. Seized Iranian Oil Over Smuggling Incident That Escalated Tensions in Gulf

NY Times-Sept 7th 2023

The United States government has seized nearly one million barrels of Iranian crude oil that it says was being smuggled to China in violation of U.S. sanctions against Iran, after it raised the threat of prosecution to get the tanker brought to American waters, newly unsealed court papers show.

The seizure of the oil from the vessel, the M/T Suez Rajan, is part of a larger and shadowy conflict with Iran. After the tanker began to steam toward the United States last spring, Iran’s Revolutionary Guards Corps seized two oil tankers in the Strait of Hormuz, prompting the U.S. military to increase patrols and deploy additional assets to protect shipping lanes.

In July, Iranian state news media said the Guards’ navy commander had warned that Tehran would hold Washington responsible if the tanker’s oil was unloaded, without giving further details. On Wednesday, a high-ranking Israeli defense official, speaking on condition of anonymity, said that the seizure raised new fears that Iran could hijack more tankers in an effort to deter the United States from repeating the move.

The court filings offer a rare glimpse into what prosecutors describe as an oil smuggling operation that kept a tanker’s location from being accurately tracked, falsified cargo records and deployed other techniques in an attempt to evade U.S. sanctions.

A spokesman for the Justice Department said it planned to issue a statement about the matter soon.

While the court filings in the case had remained sealed for months, elements of the effective American seizure of the M/T Suez Rajan had been in public view.

The tanker was sitting off the coast of Texas for several months because the government had trouble finding a company willing to offload it and risk Iranian retaliation. The standstill prompted a bipartisan group of lawmakers to urge President Biden last month to complete the seizure, calling the delay because of such fears “unacceptable.”

United Against Nuclear Iran, a nonprofit organization that includes many former U.S. and foreign government security officials, first brought attention to the likelihood that the Suez Rajan was carrying illicit oil in February 2022, citing satellite imagery.

The organization’s chief executive, Mark Wallace, a former ambassador in the George W. Bush administration, said that a Greek company that managed the vessel ultimately brought another of its ships to Texas to complete the offloading. He praised the company, Empire Navigation, for braving what he portrayed as transnational intimidation by Iran and eventually “doing the right thing.”

But he said that the length of time it had taken to resolve the matter underscored a larger problem, and that his group had identified some 300 other such tankers likely engaged in Iranian oil smuggling, based on similar data.