BP Plc chief executive John Browne told Britain's Sunday Times that it would be “impractical” for his firm to continue to do business in Iran as doing so could threaten its large operations in the US.
The Iran-Libya Sanctions Act 1996 imposes mandatory and discretionary sanctions on non-US companies investing more than US$20 million per year in the Iranian oil and gas sector.
“Politically Iran is not a flyer. One day I hope it is. Right now it is impractical for BP because 40% of BP is in the US and we are the largest producer of oil and gas in the US,” Browne told the Sunday Times.
“We’re very heavily influenced by our American position. To do business with Iran at the moment would be offensive to the United States and therefore against BP's interests.”
Browne said BP aimed to be “the partner of choice for governments around the world” and it would focus its activities in Russia, Africa and the Gulf of Mexico.
Iranian oil minister Bijan Zanganeh responded that BP’s decision was an “unfriendly act which will not be forgotten.”
“This is a gesture by BP in favour of the US and this company has ruined its long-term interests in Iran,” Zanganeh said.
“BP has not had any oil projects in Iran during its 10-year presence here, except for some small research activities. We never counted on BP.”