Calls for Biden to Aid Transfer of Iranian Oil Stuck on Tanker off Texas

Houston Ship Channel
A shipment of Iranian oil is stranded on a tanker stuck outside Houston as U.S. companies refused lightering fearing retaliation from Iran (file photo)

Published Aug 16, 2023 2:02 PM by The Maritime Executive

Six members of the U.S. Congress sent a letter to President Joe Biden calling on him to intervene to release the Iranian oil stuck aboard a tanker anchored off Houston as part of enforcement of the U.S. sanction program. The members are arguing the importance of enforcing the sanctions warning that the program would become irrelevant if the U.S. cedes to Iranian threats of retaliation.

At issue is an approximate 10-week standoff delaying the offloading of a seized cargo of oil aboard the tanker Suez Rajan (158,573 dwt). The vessel registered in the Marshall Islands is loaded with 800,000 barrels of Iranian crude which the letter asserts is valued at $56 million that should be used under U.S. law to in part provide restitution for victims of state-sponsored terrorism.

“We request that you work expeditiously to resolve the delay in the transfer of seized oil from the Suez Rajan and continue to enforce the law against Foreign Terrorist Organizations,” says the letter which is signed by senators Richard Blumenthal (Connecticut), Joni Ernst (Iowa), and Lindsey Graham (South Carolina) as well as representatives Elise Stefanik (New York), Josh Gottheimer (New Jersey), and Jim Banks (Indiana).

The letter is requesting a briefing from the White House by September 15 with an update on the progress of the transfer of the oil. They also want a list of the companies the Department of Justice or other government entities have requested to assist in the offloading operation.

The Wall Street Journal a month ago reported that the problem was that no U.S. company was willing to risk being involved in the offloading process. The tanker has been anchored since May 30 near the GOLA Offshore Terminal off the coast of Galveston, Texas. It has too deep a draft to proceed in the Houston Ship Channel to an import terminal and requires shuttle tankers to lighter a portion of the cargo ashore. 

Iran fought the seizure of the vessel which at the time was off Singapore. As the vessel neared the U.S. after a 13,000-mile trip, Iran issued threats saying it would retaliate against any company assisting in the process. This came shortly after Iran seized two tankers in the Persian Gulf region with reports saying at least one was in retaliation for the seizure of the cargo on the Suez Rajan. In 2022, Iran detained two Greek-owned tankers after the U.S. initially won the seizure of another oil cargo on a tanker in Greece. Greek courts ordered the U.S. to return the cargo which had been partially offloaded and months later Iran released the detained tankers.

The letter calls the months-long delay to offload the Suez Rajan “unacceptable” and “an unprecedented intimidation effort that threatens to undermine our nation’s security.”

“No American citizen or company should have ever fear retaliation for assisting in lawful law enforcement activities or engaging in lawful commerce,” the members said in announcing their letter to the administration. 

In April some of the same members called on the Biden administration to increase its efforts saying that the Treasury Department, Homeland Security Investigation office had not been able to conduct seizures for two of the past three years. Under the program, they contend over $200 million in illicit Iranian oil has been seized which generated over $41 million for the U.S. government’s Treasury Forfeiture Fund.