WASHINGTON, D.C. – U.S. Sens. Lisa Murkowski, R-AK, and Maria Cantwell, D-WA, on Wednesday introduced legislation that would bar companies who engage in business or trading activity with Iran from buying oil from America’s Strategic Petroleum Reserve (SPR). The measure, cosponsored by 16 other Senators, also calls for the U.S. Government Accountability Office (GAO) to expose sanction violators. 

 

“Tough sanctions are one of the most effective policy instruments we have to prevent Iran from becoming a nuclear power,” Murkowski said. “Unfortunately, last summer we realized that companies who do business with Iran are legally able to purchase oil from our nation’s strategic stockpiles. This legislation would close that loophole by adding a new certification requirement before companies are allowed to engage in any future SPR transactions.”

 

The Iran Certification and Reporting Bill, S. 2058, requires companies that want to purchase, sell or exchange SPR oil to certify with DOE that they are not engaged in any form of business activity with any Iranian entity, nor are they currently seeking to contract for any such activity. The bill follows up on concerns raised by Murkowski after the Obama administration sold oil from the SPR in June 2011 to companies known for engaging in upstream trading activities with Iranian entities. Under existing law, neither company was technically in violation of the Iran sanctions, but the Department of Energy’s decision to sell them SPR oil certainly violated the spirit of the sanctions. 

 

The Murkowski-Cantwell bill also calls for the U.S. Government Accountability Office (GAO) to track a variety of information related to the movement of Iranian crude oil and refined petroleum products and provide regular reports to Congress.

 

“Oil and refined petroleum products are arguably the Achilles’ heel of the Iranian regime, Cantwell said. “Exposing the names of sanction violators will help shut down this trade and the resulting revenues Iran is using to fund its nuclear program. This is critical to determining whether our existing sanctions regime is adequately targeted or even effective.” 

 

There is concern that some companies are flouting sanctions by continuing to trade petroleum products with Iran, effectively “backfilling” for those that have been good corporate citizens and are in compliance with U.S. law.  However, this information is not easily accessible even to policymakers. This bill requires the GAO to produce a report to Congress every 180 days describing the movements of both crude oil and refined petroleum products to and from Iran, including through swaps and similar arrangements, as well as the entities that are financing these transactions, providing the necessary shipping and insurances, or helping Iran invest in their petroleum infrastructure.

 

Murkowski, the ranking member of the Senate Energy and Natural Resources Committee, and Maria Cantwell, the chair of the Energy Subcommittee, were joined by 16 cosponsors: Dean Heller, R-NV; Kirsten Gillibrand, D-NY; Rob Portman, R-OH; John Barrasso, R-WY; John Cornyn, R-TX; Jon Kyl, R-AZ; David Vitter, R-LA; James Risch, R-ID; John Hoeven, R-ND; Mary Landrieu, D-LA; Mark Begich, D-AK; Richard Lugar, R-IN; Michael Bennet, D-CO; Robert Menendez, D-NJ; Mike Crapo, R-ID; Marco Rubio, R-FL.  

 

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