According to IRNA Political Desk, the diplomatic relations of the two countries date back to 1962. Throughout history despite Iran’s close ties with North Korea and South Korea’s close ties with the United States, Iran and South Korea not only maintained their close ties, but also further expanded them continually.
But ever since the re-imposing of the anti-Iranian sanctions by Trump administration in 2018 Iran-Korea ties kept on deteriorating.
Tehran complains about the blocking of some seven million dollars of its cash assets in South Korea from the summer of 2019 when the US sanction waivers on Iranian oil purchase for South Korea ended. Apparently a number of official talks on the issue have been of no avail and Tehran has filed a law suit against Seoul at The Hague International Court of Justice.
The not-so-positive stands adopted by South Korean officials during the course of the past ten months despite their record of traditional close ties with Iran can indicate a major change in Seoul’s commercial diplomacy in the Middle East, and particularly with Iran. At any rate, the two countries’ relations have been subjected to some ups and downs during the recent years, which are focused on here.
Iran’s increased oil sales to South Korea after JCPOA
South Korea was one of the major buyers of Iranian oil after the nuclear deal called JCPOA was reached, so that in 2017 Iran became the third largest exporter of crude oil to South Korea. South Korea also became the largest buyer of Iran’s oil derivatives and gas during the same period.
In addition to the bilateral commercial ties, the two countries’ payments to each other were done by the Central Bank of Iran, the Korean Industrial State Bank and the Woori Financial Group.
Effects of US exit from JCPOA on Iran-Korea ties
Following the Trump administration’s exit from JCPOA in 2018 South Korea has been forced under the US pressure to initially lower its oil imports from Iran and eventually cut it. Due to its amicable ties with Tehran, Seoul several times asked for sanction waivers, which were twice accepted by the United States.
The South Korean refineries had during the recent years managed to buy their entire required light oil from Iran, but the US refraining from extending their sanction waivers had very much worried that country and increased their expenses.
The South Korean refineries had announced that the Iranian super light oil not only had lower Sulphur from that of the other countries, such as Qatar, but was also cheaper, and very appropriate for their petrochemical industries, and very appropriate for manufacturing various products, such as plastic bottles.
Yet, South Korea suffered very much from the US anti-Iran sanctions as a major importer of the Iranian oil, so that the annual 7.8-billion-dollar oil imports of Korea in 2017 decreased 2.1 billion dollars in 2019 and down to zero in 2020.
The South Koran ship makers, too, who wished to gain contracts for building the new fleet of Iranian oil tankers lost their hopes and the Korean construction companies that were involved in renovation of the Iranian oil and gas fields, too, lost their jobs after Trump’s exist from JCPOA.
Kora does no participate in US naval coalition
Beyond doubt a part of Seoul’s impenetrable stand during the past months is due to South Korea’s very strong economic, political and security ties with the United States. South Korea is a small country that depends highly on its exports, and not only is very eager to safeguard its access to US markets, but is also very much dependent on Washington for ensuring its national security and military back-up.
Yet, although South Korea is a major US ally in Southeast Asia and host to 28,000 US soldiers in its soil, due to the history of its amicable ties with Tehran, Seoul refrained from participation in US proposed naval coalition in the Strait of Hurmuz.
Instead, after consultations with Tehran, Seoul forwarded its anti-piracy naval fleet from the Somalian shore in the Red Sea to the Sea of Oman, rather than the Strat o Hurmuz to keep a balance between the Iran and the US demands.
Iran’s blocked monetary assets in South Korea
In 2012 South Korea was one of the major buyers of the Iranian oil after the JCPOA was reached. But after the re-imposing of sanctions in 2018 not only it decreased its oil imports from Iran down to zero, but it also actively participated in the unilateral US anti-Iranian sanctions and refrained from paying the price for the oil it had bought from Iran.
Iran’s blocked money in South Korea is between 7 to 9 billion dollars, that is now in the Korean Industrial State Bank and the Woori Financial Group. Yet, the South Korean news agency Yonhap, quoted South Korean officials that they were negotiating with Iranian officials for release of those assets.
A South Korean official who had spoken on condition of anonymity had told the Korean news agency Yonhap last Tuesday that keeping in mind the US green light Seoul is ready to sell Corona vaccines to Iran and is also engaged in negotiations to release the blocked Iranian money in Koran banks.
A South Korean delegation, led by a deputy foreign minister is therefore heading for Iran for talks on release of the blocked money.
Holding a violating South Korean Ship at Strait of Hurmuz
Islamic Revolution Guard Corps (IRGC) naval forces last Monday held a South Korean oil tanker, Hankuk Chemi, carrying 7.2 thousand tons of chemical fluids and oil because of violating environmental protocols. The ship is now anchored in Iran’s Bandar Abbas port.
Foreign Ministry Spokesman Saeid Khatibzade told reporters last Monday that holding the Korean oil tanker is merely due to technical issues and polluting the sea, based on a judiciary order, and it is guided to shore to survey its violations.
South Korea provides 70% of the oil it needs through the Strait of Hurmuz.
Diplomatic Traffic
Following the holding of the South Korean oil tanker in Bandar Abbas the traffic of the two countries diplomats has increased during the past few days. A South Korean foreign ministry official met the Iranian ambassador to Seoul as the first move.
Also the Yonhap reported that a delegation led by the managing director of Africa and Middle East Affairs of South Korean Foreign Ministry that left Qatar on Thursday for talks on release of the held ship and release of the Iranian blocked assets.
Also, early next week first deputy Korean foreign minister is heading for Iran for talks on what the Iranian Foreign Ministry says is initially the release of Iranian blocked assets, and then bilateral ties, including the status of the held Korean ship.
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