Iran Will Soon Make Embargo Ineffective – Oil Minister

Iran’s Oil Minister Rostam Qasemi said today in Tehran that his office has drawn up plans to make EU embargo of Iranian oil ineffective. Qasemi did not disclose any details on how the plans will work, but the Iranian officials had earlier said they are organizing a consortium of private companies to bypass the embargo. (shana.ir/AP)

IRGC Exercises, Hints of Hormuz Closure Raise Oil Prices

IRGC has launched three-day drills to test its long-range missiles. The move is seen as a defiant response to EU embargo of Iranian oil, which went into effect on Sunday. The US also began to impose tough new sanctions on Iran’s oil industry last week. The new sanctions are designed to inflict economic hardship on the country, forcing its leaders to limit their nuclear program.

Meanwhile, in another sign of defiance at international pressures, the national security committee of Majlis drafted a bill to close the Strait of Hormuz to all tankers carrying oil to EU countries. If this latest move was a posturing to jack up oil prices, it succeeded and the Brent crude approached the $100 mark on Monday. 

Majlis Delays Action on Cutting Oil Deliveries to EU

Iran’s parliament, Majlis, has delayed taking action on a proposed bill to immediately cut oil deliveries to Europe in retaliation for an EU oil embargo that were to go into full effect in July. A spokesman for Majlis’s energy committee said no proposed legislation had come to the parliament floor. The Iranian media had reported yesterday that the legislation would go to Majlis floor on Sunday on “double emergency” track, meaning the legislators would have been able to vote on it after a shortened debate.

Earlier today, the German Foreign Minister Guido Westerwelle had called the Iranian threat to immediately halt oil exports to Europe “a regrettable and dangerous escalation in rhetoric.” He added the EU would find ways “to compensate for (Iran oil) delivery stoppages.” [AFP, 29 January].

Iran Navy: Closing Strait of Hormuz "Really Easy"

A day after Iran’s first vice president threatened the West with stopping the flow of oil through the Strait of Hormuz if sanctions were imposed on oil exports, the country’s naval commander said closing the Persian Gulf to oil tankers will be “easier than drinking a glass of water.”

“Closing the Strait of Hormuz for Iran's armed forces is really easy ... or as Iranians say it will be easier than drinking a glass of water," said Rear Admiral Habibollah Sayyari. “But right now, we don't need to shut it as we have the Sea of Oman under control, and we can control the transit,” Adm. Sayyari added [Press TV, 28 December].

Iran Oil Embargo Discussed in Rome

A Decision Expected in January

Diplomats from the US, the EU and other countries like Australia, Japan and South Korea, the so-called “like-minded nations,” gathered in Rome today to discuss further sanctions against Iran, Reuters reported. The Italian foreign ministry is hosting the gathering.

The major topic of discussion is a possible oil embargo against Iran. Diplomats told Reuters that a decision could be made when the EU foreign ministers next meet in January.

Iran could still sell its crude after the embargo to customers in countries like China and India, which are among Iran’s major importers. But if the Central Bank of Iran (CBI) is added to the sanctions list, as already voted through by the US Congress, then those customers will have serious difficulties to pay for the crude. And a combination of EU embargo and sanctions on CBI could seriously disrupt Iran’s oil exports.

UPDATE: The Wall Street Journal, citing unidentified US, European and Arab diplomats, reported that Iran's oil exports and global energy prices were key issues on the table. An Italian foreign ministry official said the participants stressed the urgent need for Iran to satisfy world concerns about its nuclear program [AP, 20 December].

EU Fails to Impose Oil Embargo on Iran

Greece Objected to an Embargo

EU foreign ministers failed today to reach an agreement to impose an oil embargo against Iran. They could only agree to add 37 people and 143 companies and organizations to the sanctions list, including the Iranian shipping line, IRISL, and entities controlled by IRGC.

French Foreign Minister Alain Juppe said that Greece, which relies on Iranian oil, had objected to Iran oil embargo.

“Greece has put forward a number of reservations,” Juppe said. “We have to take that into account. We have to see with our partners that the cuts can be compensated by the increase of production in other countries. It (the embargo) is very possible,” he added [AP, 1 December].