The European financial settlement mechanism (INSTEX), aimed at circumventing US sanctions against Iran, is working and transactions are already happening, according to Iran’s JCPOA envoy.
The payments mechanism was established by the European Union to keep trading with Tehran despite US sanctions in order to keep the nuclear deal with Iran alive.
The US re-imposed sanctions against the Islamic Republic following Washington’s withdrawal from the 2015 Iran nuclear deal, officially known as the Joint Comprehensive Plan of Action (JCPOA).
The US has been mounting pressure on Iran and anyone breaking its sanctions against the country, threatening to punish any company that continues doing business with the Islamic Republic, including the purchasing of Iranian oil.
“We will sanction any imports of Iranian crude oil… There are right now no oil waivers in place,” US Special Representative to Iran Brian Hook said in Friday, after it was reported that China is still importing Iranian crude.
On Friday, seven EU countries said in a joint statement they are working with Britain, France, and Germany on establishing trade channels to Iran, including “one of the foremost of these initiatives” – the Instrument in Support of Trade Exchanges (INSTEX).
However, the EU’s efforts to set up the long-promised payment channel have not satisfied Tehran. Earlier this week, Iranian Foreign Ministry spokesman Seyed Abbas Moussavi called INSTEX a “faux thing of no practical use,” according to Iranian media.
He later said that if this turns out to be the case, the Islamic Republic will not accept it and may change its commitments under the nuclear deal that Brussels is trying to hold on to.