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Stricter targeting of Iranian oil could be tempered by

China

concerns

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Trump will need to determine if sanctions can help achieve

his

goals

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Foreign ports, refineries processing Iran exports could be

targeted

By Timothy Gardner and Vivian Sequera

WASHINGTON/CARACAS Nov 13 (Reuters) - President-elect

Donald Trump's pick of U.S. Senator Marco Rubio for secretary of

state could signal stricter enforcement of oil sanctions on Iran

and Venezuela, but concerns about retaliation by China could

temper any efforts, analysts said on Wednesday.

Rubio, a longtime member of the Senate Foreign Relations

Committee, has long pushed for a tougher U.S. policy on Iran and

China. Rubio, whose parents immigrated from Cuba to the U.S., is

also a critic of Venezuela's socialist President Nicolas Maduro,

whose two re-elections have been disputed by Washington, leading

to oil sanctions on the OPEC nation.

Iran's oil production has been the target of successive

waves of sanctions, and during Trump's first term, oil exports

from the third-largest producer in OPEC slowed to a trickle.

They have risen during President Joe Biden's tenure as

analysts say sanctions have been less rigorously enforced, Iran

has succeeded in evading them, and as China has become a major

buyer, according to industry trackers.

"Senator Rubio has a consistent and strong record as a hawk

on Iran, Venezuela, and China," said Bob McNally, president of

Rapidan Energy, who was an energy adviser to former President

George W. Bush.

Rubio will "zealously implement President-elect Trump's

plans to exert pressure on Iran's crude exports, nearly all

which go to China," a trend that increased under Biden, said

McNally.

Going hard on sanctions carries the risk of upsetting China,

which could retaliate in several ways, including reducing the

primacy of the dollar in oil trades, said Kevin Book, energy

policy analyst at the nonpartisan ClearView Energy Partners.

Trump referred to China and risks to the dollar from

sanctions in a September speech at the New York Economic Club.

SANCTIONS VS GOALS

Kimberly Donovan, a sanctions and anti-money laundering

expert at the Atlantic Council, said Washington has strong

existing sanctions which Rubio could push foreign partners to

enforce. But sanctions are just one tool of national security

and not always the best one, Donovan said.

"The next Trump administration will need to determine what

their foreign policy objectives are and then decide if sanctions

will help them achieve their goals," Donovan said.

No one official heads implementation and enforcement of

sanctions, and Rubio would have to serve at the pleasure of

Trump. The Departments of State, Treasury and Commerce typically

work on sanctions with counterparts in Europe and Asia.

The Trump administration will try to maintain those

relations as it will likely seek to use authorities in the 2024

Stop Harboring Iranian Petroleum (SHIP) U.S. law, Book said. The

law, which the Biden administration did not strictly enforce,

allows the imposition of measures on foreign ports and

refineries that process petroleum exported from Iran in

violation of U.S. sanctions.

"Use of new authorities to go after those ports would

require a great deal of new resolve from the incoming

administration, but it could probably have the effect of

curtailing some Iranian barrels," said Book.

VENEZUELA

Rubio's appointment means an improvement in relations

between the U.S. and Venezuela is unlikely, said Luis Peche

Arteaga of Caracas consulting firm Sala 58, adding that "it

looks like more than anything like a confrontational approach."

Jose Cardenas, a former adviser on Latin America policy

under Bush, said top of the list for the Trump administration

would be "oil sanctions and reviewing oil licenses allowing U.S.

and foreign oil companies to do business with Maduro."

Since 2022, Biden has issued licenses to some foreign

partners and customers of Venezuelan state oil company PDVSA,

including Chevron ( CVX ), Repsol, Eni and

Reliance Industries, allowing oil deliveries to the

U.S., Europe and India.

That helped Venezuela's oil exports last month to jump to

950,000 barrels per day, a four-year high, despite the Biden

administration reinstating broad restrictions on Caracas this

year due to Venezuela's lack of guarantees for a fair election.

"Revoking the oil licenses would send a powerful signal to

not only Maduro, the opposition, the EU, and others that the

U.S. is serious about a democratic transition taking place in

Venezuela," said Cardenas, now a Washington strategic consultant

and lobbyist.

Here too, there will be limits on Rubio. Analysts have

warned that tougher sanctions could prompt Venezuela, which has

already created strategic alliances including with Iran to

allocate its oil, to boycott Trump's goal of repatriating

thousands of illegal migrants.