US to impose new North Korea sanctions targeting energy trade, shipping

Washington (Platts)--21 Sep 2017 620 pm EDT/2220 GMT

The US will impose new sanctions designed to cut off funding for North Korea by targeting individuals and companies that trade with the Kim Jong-un regime, including those involved in energy, mining and shipping, Treasury Secretary Steve Mnuchin said Thursday.

In an executive order, President Donald Trump authorized the Treasury Department to impose sanctions on:

  • Industries: The construction, energy, financial services, fishing, information technology, manufacturing, medical, mining, textiles or transportation industries in North Korea.
  • Ports: Ownership, control or operation of any port in North Korea, including any seaport, airport or land port of entry.
  • Imports/Exports: At least one significant importation from or exportation to North Korea of any goods, services, or technology.

The order issues a 180-day ban from visiting the US on vessels and aircraft that have visited North Korea. The ban also includes vessels that have done a ship-to-ship transfer with a vessel that has visited North Korea within 180 days.

"North Korea is dependent on its shipping networks to facilitate international trade," the White House said in a fact sheet about the executive order.

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While China is responsible for most trade with North Korea, Mnuchin said in a press conference that the order was not singling out any country.

"For too long, North Korea has evaded sanctions and used the international financial system to facilitate funding for its weapons and mass destruction and ballistic missile programs," Mnuchin said. "No bank in any country should be used to facilitate Kim Jong-un's destructive behavior."

Related Capitol Crude podcast episode: What would an oil embargo mean to North Korea, which produces no petroleum?

Last week, the UN Security Council agreed to a ban on all condensate and natural gas liquids supplied to North Korea and limiting exports of refined products to a total of 500,000 barrels from October 1 to December 31 and to 2 million barrels for all of 2018.

The resolution also bars UN members from exporting more crude to North Korea than they exported over the previous 12 months.

According to China's official customs data, the last crude exports to North Korea were in December 2013 at 92,223 mt, with a total of 578,002 mt (4.24 million barrels) of exports to the country that year.

After that, no crude exports to North Korea are recorded, but market sources in North Asia say North Korea currently takes about 6 million barrels/year of Chinese crude.

Related: Find more content about Trump's administration in our news and analysis feature.

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