(Persia Digest) - Iran’s Grace 1 oil tanker remained off the coast of Gibraltar following its release on Thursday, while the U.S. threatened sanctions against anyone dealing with the ship.

Bloomberg reports that the U.S. earlier said it is gravely disappointed with Britain after a court allowed the release of the tanker, and it warned that ports, banks and anyone else who does business with the ship or its crew might be subject to penalties, according to two administration officials. Iran’s foreign minister said on Twitter Thursday that the ship’s detention was unlawful.

The tanker’s cargo was originally bound for Syria, and Iran has provided assurance that this is no longer the case, the Gibraltar government said in a statement Friday. “The evidence is clear and the facts speak louder than the self-serving political statements we are hearing today," it added, without specifying which comments it referred to.

Missed Opportunity

The court’s decision Thursday to release the Grace 1 was a missed opportunity and the Trump administration hopes that the U.K. government and authorities in Gibraltar will reconsider, according to the U.S. officials, who asked not to be identified discussing private deliberations. They said the court order rewards Iranian terrorism and Tehran will interpret the action as appeasement.

It’s not clear when the Grace 1 will set sail. It has remained in Gibraltar since British forces seized it last month for violating trade sanctions. The U.S. Department of Justice hadn’t filed the appropriate action to block the vessel’s release, the Gibraltar Supreme Court said Thursday.

The American officials said the U.K. should think of the tanker issue in terms of the broader relationship with the U.S., particularly as Prime Minister Boris Johnson’s government presses forward with departing the European Union and seeks a free-trade agreement with the U.S. While the people wouldn’t say the release threatens prospects for that deal, they added that the U.K. should ask if it wants to do business with the U.S. or Iran.

Gibraltar’s decision to release the ship essentially sets up a race between Iran and the U.S. over its fate. Iran’s Mehr News agency said Thursday the vessel was bound for a port in the Mediterranean, citing Jalil Eslami, deputy for maritime affairs of the Iranian ports and maritime organization. However, it hadn’t moved as of 12:13 p.m London time on Friday, according to tanker-tracking data compiled by Bloomberg.

Gibraltar’s chief minister said the case may yet return to a court in the territory if proceedings are brought forward by the U.S.

Read more:

US justice department issues warrant to seize Iranian tanker

Gibraltar says Grace 1 free to go whenever it is ready

Grace 1 oil tanker to be released soon

Diplomatic Row

The seizure of the tanker set off a diplomatic row, underscoring tense relations between Iran and the West that have only worsened since the U.S. reimposed sanctions on the Persian Gulf state last year. Tensions have been high in the region in recent months amid a series of vessel attacks and seizures, which have threatened shipping in the Strait of Hormuz, the world’s most critical chokepoint for oil shipments.

Following the detention of the ship on July 4, Iran seized a British-flagged vessel, the Stena Impero, which it continues to hold.

The U.K. Foreign and Commonwealth Office cautioned that there was no connection between Gibraltar’s enforcement of sanctions and Iran’s activities at the mouth of the Persian Gulf.

“There is no comparison or linkage between Iran’s unacceptable and illegal seizure of, and attacks on, commercial shipping vessels in the Strait of Hormuz and the enforcement of EU Syria sanctions by the Government of Gibraltar,” it said in an emailed statement Thursday. “Freedom of navigation for commercial shipping must be respected and international law upheld.”

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