US Threatens Spain With Sanctions Over Port Access for Ships Bound for Israel

The United States government is considering imposing economic sanctions on Spain, including fines of up to $200,000 on Spanish vessels and import restrictions on key Spanish industries like olive oil, ceramics, and cosmetics. This potential action stems from Spain's decision to deny docking to three American ships this year, which Spain claimed were carrying cargo to or from Israel amidst the Gaza war. This dispute arises from the Spanish government's critical stance towards Israel since the outbreak of the "Swords of Iron" war, led by Prime Minister Pedro Sánchez. Madrid has halted arms sales to Israel and restricted the transit of defense-related cargo through its territory and ports.

Washington views Spain's denial of port access to ships involved in transporting defense cargo as an infringement on freedom of navigation and U.S. strategic interests. This is not the first such incident; in May 2024, Madrid refused docking to the Marianne Danica, carrying explosives from India to Israel, at the port of Cartagena. Disputes also arose concerning vessels from the shipping company Maersk, including the Maersk Denver and Maersk Seletar, which were carrying cargo for the U.S. Department of Defense.

The U.S. administration may see the denial of access to American-owned, leased, or flagged vessels carrying defense cargo to an ally as a violation of maritime trade relations, prompting consideration of legal and economic tools. The Federal Maritime Commission (FMC) and the U.S. Trade Representative (USTR) have powers that could enable the imposition of fines and commercial retaliatory measures, potentially including port access limitations, under U.S. law designed to counter barriers and discrimination against American vessels.

Furthermore, pressure is mounting in the U.S. Congress to enact economic measures against entities perceived to be harming the defense supply chain to Israel, possibly utilizing Section 301 of the Trade Act. The targeted industries, olive oil, ceramics, and cosmetics, were chosen due to their significance to Spanish exports to the U.S., a crucial market for Spanish producers, particularly in Andalusia for olive oil and in Castellón for ceramics. The cosmetics sector, with companies like Puig operating in the U.S., could also be affected.

However, these potential U.S. actions could extend beyond bilateral relations. If the U.S. imposes tariffs or import restrictions targeting Spanish products, the European Union, specifically the European Commission, might intervene to protect member state interests and the integrity of the common market. This could escalate a dispute initially focused on ship docking and defense equipment into a broader trade conflict between the U.S. and the EU. Currently, these are measures under consideration by the U.S. administration, not yet enacted sanctions, with the outcome dependent on decisions made in Washington and Madrid.