A row between Iran and South Korea has intensified, with Tehran threatening legal action unless Seoul releases more than $7 billion in funds for oil shipments frozen because of US sanctions.
Iran was South Korea’s third-largest Middle Eastern trade partner before the United States unilaterally withdrew from a 2015 nuclear deal between Tehran and world powers and reimposed crippling sanctions.
Iran had been a key oil supplier to resource-poor South Korea and in turn imported industrial equipment, household appliances and vehicle spare parts from Seoul.
“We have $7.8 billion of our money blocked in South Korean banks,” said Iranian lawmaker Alireza Salimi, who is involved with the case.
South Korea took delivery of the Iranian oil “but did not pay for it,” he told AFP.
“It is not a reliable trading partner and it should pay interest on the money it is improperly holding,” he charged.
A foreign ministry official in Seoul told AFP that “it is difficult to confirm” the exact amount of money involved.
South Korea stopped purchasing Iranian oil after former US president Donald Trump exited the nuclear deal in 2018, reimposing the harsh sanctions and threatening to punish anyone buying crude from Iran.
That year, Iran-South Korea trade fell by half compared to 2017, when it had stood at $12 billion, according to Iran’s embassy in Seoul.
The volume of trade tumbled to just $111 million by mid-July 2020, according to embassy figures.
In January, Iran’s Revolutionary Guards seized a South Korean-flagged tanker, the Hankuk Chemi, and held it and its captain for three months, ostensibly over alleged environmental violations.
The seizure was widely seen in South Korea as an attempt to force Seoul’s hand over the frozen funds, though Tehran repeatedly denied there was any connection.
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