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Voice of America | Oct 14
Iranian negotiators begin meeting this week with the United Nations contact group in Geneva amid hopes that Tehran's moderate new government will h...
For an overview of how Asian nations will be affected by sanctions on Iran, I'm joined in studio by LinkAsia Producer George Lewinski. George, welcome to the show. So tell us, how much of a sacrifice would Asian nations be making if they stop buying Iranian oil?
It depends on the country. The two biggest guzzlers, India and China, say they're not going to play along with the United States sanctions. Japan and South Korea said that they will at least slow down their purchases of Iranian oil, even if they don't stop buying it entirely. And I think that will be enough to satisfy the US. However, any kind of disruption in oil prices will have an effect on someone's economy. We saw in the MBC piece that they were going to have to pay maybe 400 million dollars more a year to change suppliers. So, you know, that's a pretty good piece of change. But everybody, including China, as we saw in the CCTV item, are sending their top leaders to Saudi Arabia and the Gulf states to make sure, so they can hear for themselves from the king of Saudi Arabia that yes, we will increase production to make up for any shortfall that will be caused by Iranian oil not reaching the market.
All right, everyone just minding their manners. But think about it. What would Iran do for customers if you think about China, Japan, India and South Korea. I mean, together they buy 60 percent of Iran's oil.
That's right. Iran is clearly very upset by this threat of sanctions. They've threatened to close the Strait of Hormuz to shipping, and that would basically be a declaration of war. So that sort of would be their nuclear option, I guess. But what's more likely is that they will start offering deep discounts to their customers. Maybe as much as 30 percent lower than the world price. And those, that kind of a deal would be very hard for many countries to reject.
So, George, what I'm hearing, you don't really see much of an economic fall-out from any embargo on Iranian oil then.
Well, look, the world economy's in a very, very fragile state right now. And any spike in oil prices, any uncertainty in something like the oil markets, no matter how short a duration, will have an effect. Second thing is, we have to remember that Asia is the only bright spot in the world economy. Any slowdown there will affect all of us.
Interesting. We'll wait to see what happens. George, thanks so much. George Lewinski is a journalist who worked for the Canadian Broadcasting Corporation and public radio in the US.