EU buckles on Iranian oil sanctions

EU foreign ministers have piled pressure on Iran over its contested nuclear program, slapping sanctions on an extra 180 firms and individuals and threatening to hit out at its vital oil sector.


Expressing “deepening concerns” on the nature of the nuclear program, the 27 European Union foreign ministers urged the bloc to “extend the scope” of current sanctions in order to strike at Tehran’s financial heart.

A statement said the ministers agreed to examine measures in particular affecting the financial system in the transport and energy sector.

Outraged by Tuesday’s storming of the British embassy in Tehran, the ministers also said they considered “these actions against the UK as actions against the European Union as a whole”.

British Foreign Secretary William Hague said on joining the talks that he would urge his counterparts to squeeze Iran for both its nuclear activities and mounting human rights violations.

“I hope we will agree today additional measures that will be an intensification of the economic pressure on Iran, peaceful legitimate economic pressure particularly to increase the isolation of the Iranian financial sector,” he saod.

Though German counterpart Guido Westerwelle too favoured moves “to dry up Iran’s financial sources”, the crisis-hit EU is deeply split over slapping an oil embargo on Iran as well as over calls by some, including Britain, to agree an assets freeze on Iran’s central bank.

The new sanctions follow the publication last month of a new report on Iran’s contested nuclear activity by the International Atomic Energy Agency (IAEA).

The punitive measures target both firms and individuals involved in the nuclear program and those linked to the Islamic Republic of Iran Shipping Line (IRISL) and the Islamic Revolutionary Guards Corps (IRGC).

Much of the international community fears Iran’s nuclear program masks a drive for a weapons capability, though Tehran says it serves peaceful civilian energy and medical purposes only.

Meanwhile, EU foreign policy chief Catherine Ashton, who leads global talks with Iran on the sensitive nuclear issue, reiterated a plea to Tehran to resume dialogue.

“We have put proposals on the table,” she said. “It is for the Iranians to come back and if they don’t come back and answer or at least put forward their own proposals, we have to draw conclusions.”

Urging the EU “to ratchet up sanctions” in the light of the attacks on the British embassy, Ashton said it was time “to make it clear to Iran that we are very serious”.

But that is easier said than done.

Britain, France, Germany and Sweden favour a bar on buying oil from Iran.

However, others led by economically-troubled Spain, Greece and Italy are significantly dependent on Iranian crude.

Oil from Iran in 2010 amounted to 5.8 per cent of total EU imports, making Tehran the bloc’s fifth-largest supplier after Russia, Norway, Libya and Saudi Arabia.

Of that total, Spain accounted for 14.6 per cent, Greece for 14.0 and Italy for 13.1 per cent.

Cash-strapped Greece led opposition to an oil embargo, with an EU diplomat saying: “Iran sells them on credit which is a considerable advantage these days.”

The EU has already frozen the assets of hundreds of Iranian firms and in July last year adopted measures aimed at preventing new investment, technical assistance and technology transfers, particularly those pertaining to producing and refining gas.