Tankers hit amid Abe’s ‘mission impossible’ to Iran

Regional tensions spiked with the worst possible timing for Shinzo Abe on Thursday, as he undertook the first visit by a Japanese prime minister to Iran since the Islamic Revolution in 1979.

Abe’s peacekeeping mission, which some observers believe was doomed from the start, was not helped when an attack was reported on two ships in the Strait of Hormuz on the same day he was meeting the country’s top leader, following a meeting with President Hassan Rouhani on Wednesday.

Abe was ostensibly mediating between Iran’s leaders and his key global ally, United States President Donald Trump. However, the rare trip – Japanese premiers are not, customarily, high-profile peacemakers – also involved self-interest.

Japan is heavily reliant upon Middle Eastern oil. Any Iran-US conflict in the Gulf would almost certainly be bloody and likely to add a large risk premium to oil, dealing a heavy blow to Abe’s energy-hungry economy. That risk was made glaringly apparent on the second day of Abe’s stay in Tehran.

Reports on Thursday of two tankers being attacked and damaged near the Strait of Hormuz, and sending distress signals to nearby US warships, sparked an immediate 4.5% leap in oil prices.

The vessels notably contained “Japan-related cargo”, the AP quoted Japan’s trade ministry as saying.

‘Tanker crews evacuated’

The crews of two oil tankers were reportedly evacuated off the coast of Iran after they were attacked in the Gulf of Oman. The mysterious attacks are the second on ships in the strategic sea lane in a month.

Iran said its navy rescued 44 crew members after the two vessels caught fire in “accidents” off its coast. Iranian state TV showed a picture of one tanker billowing smoke allegedly off the coast of Oman (see above).

The news comes one month after the UAE and Saudi Arabia reported a similar attack on four vessels in the Gulf of Oman. The Emirati foreign ministry at the time said there had been no injuries or fatalities, and no spillage of fuel or harmful chemicals.

Scarce information has been revealed about the nature of the alleged May 12 attacks. A video report by Abu Dhabi’s Sky News showed the hull of one vessel, the Andrea Victory, appearing to be twisted in one area from an impact at the waterline, though it was unclear exactly what had occurred. Riyadh and Abu Dhabi have suggested Tehran was behind the attacks, but stopped short of directly accusing the Islamic Republic at the UN Security Council earlier this month.

Tokyo goes to Tehran

Abe met Iran’s Supreme Leader, Ayatollah Ali Khamenei, today. In the first report from that meeting, Abe told reporters: “Supreme Leader Khamenei made a comment that the country will not and should not make, hold or use nuclear weapons, and that it has no such intentions.”

Khamenei’s reported statement is, however, a reiteration of a long-stated Iranian position. Unless Abe has engineered some kind of diplomatic engagement he has not made public, signs are not apparent of any breakthrough in Tehran-Washington relations.

Iran’s Supreme Leader further told Abe he does not consider US President Donald Trump “worthy” of exchanging messages with, in a rare televised meeting on Iranian state television, AFP said.

“At the moment, tension is rising,” Abe told reporters in Tehran, according to AP. “We should do anything we can to prevent an accidental conflict from happening and Iran should play its constructive role.” Warning of the risk of “an accidental conflict,” he said fighting should be avoided, “at all costs.”

Speaking at the same press conference, Iranian President Rouhani did not back down. He reiterated a warning that Iran would offer a “crushing” response to any US attack.

Market tremors

For Noam Raydan, a geopolitical analyst at tanker tracker ClipperData, the latest incident serves as a warning of heightened risks to shipping in the region, regardless of the party behind the attack.

“The situation remains very vague, and it’s very difficult to tell what’s happening, but given that the company BSM which manages one of the tankers, the Kokuka Courageous, commented on the incident in the Gulf of Oman – this means something happened,” she told Asia Times.

The timing and the Japan link to the cargo, Raydan says, “raises questions”.

An industry professional who spoke on condition of anonymity told Asia Times: “There is more and more confusion in the region – who is behind these attacks – and it is also creating confusion in the market itself, and keeping it volatile.”

The ships affected, according to ClipperData, were the Kokuka Courageous, a Panama-flagged chemical and oil products tanker owned by Singapore-based Bernhard Schulte ship Management (BSM). The other was the Marshall Islands-flagged Front Altair, an Aframax class vessel, which loaded on Tuesday June 11 in the UAE port of Rouwais, and was carrying around 700,000 barrels of Naphtha – a blending component – when it was attacked.

The Front Altair is a Norwegian tanker that was hit with three explosions but none of the 23 crew was hurt, the chief executive of the company that owns the vessel told AFP later. “I can confirm that the vessel has NOT sunk,” Frontline chief executive Robert Hvide Macleod wrote in a text to AFP. The 23 people who were on board were “all safe”, he added.

The Japan connection

While Tokyo and Washington differed over Middle Eastern policy during the first oil shock of 1973, in recent years, Tokyo – faced with a nuclear-armed North Korea and a fast-rising China – has aligned itself as closely as possible with Washington.

Watertight bilateral ties were on high-profile show during Trump’s state visit to Japan last month. During that trip, the US president was greeted by Japan’s newly inaugurated emperor, presented a personal trophy to the victor at a sumo tournament, and visited a Japanese warship with the same name as a vessel which had attacked Pearl Harbor in 1941.

It was during that visit that Trump welcomed Abe’s offer to mediate between Iran and the United States after state broadcaster NHK reported a possible Tehran trip.

However, in the days prior to his trip, nobody can accuse Abe of not doing his homework. Abe has spoken to Trump, with Israeli Prime Minister Benjamin Netanyahu, Saudi Crown Prince Mohammed bin Salman and Abu Dhabi Crown Prince Sheikh Mohammed bin Zayed Al Nahyan, according to newswires reporting from Japan.

Still, Abe’s effort is not simply a favor to Trump or the global community.

Japan has radically cut back on nuclear power usage since 2011’s Fukushima disaster, making Middle Eastern oil ever more critical. Credible Iranian threats to close down the Strait of Hormuz – the strategic, narrow Gulf waterway through which a third of the world’s traded oil supplies pass – would, if made good, prove hugely costly for Japan, an exporter of manufactured goods and a net importer of energy, in terms of hiked oil prices.

During their joint press conference on Wednesday, Rouhani said that Japan wanted to purchase Iranian crude oil, but previous purchases had been halted by American sanctions.

Abe, however, did not acknowledge this, according to AP.

Good effort, bad time

Even for this often tense region, Abe’s peacemaking mission comes at a difficult time.

Tehran appears poised to exit the 2015 nuclear deal it cut with global powers, following Washington’s unilateral withdrawal last year.

Meanwhile, Iran is deeply engaged in two bloody civil wars, both with major spillover potential, in Syria and Yemen. In the latter, Houthi rebels have already expanded their attacks to Saudi Arabia.

Both Trump and his Secretary of State Mike Pompeo have suggested talks with Iran, but Washington has also upped the ante by deploying significant muscle – including an aircraft carrier and B52 strategic bombers – to the region. It is also waging economic war, sanctioning Iran and pressuring allies to do likewise. This has caused the Iranian currency and oil exports to spiral downward.

Though diplomatic niceties were maintained for the Japanese prime minister, with Tehran in an apparently recalcitrant mood, Abe’s effort looks to have suffered the same fate as a mission earlier this week by German Foreign Minister Heiko Maas.

In a joint press conference on Monday with Iranian Foreign Minister Mohammad Javad Zarif, it was clear that the two had not managed to engineer a breakthrough.

“Mr Trump himself has announced that the US has launched an economic war against Iran,” Zarif said. “The only solution for reducing tensions in this region is stopping that economic war.”

And he warned: “Whoever starts a war with us will not be the one who finishes it.”