Over 700 Barges Stranded by Mississippi River Closure in Memphis Due to Bridge Crack
The U.S. Coast Guard said 44 vessels with a total of 709 barges are now in the queue as a 1-miles stretch of the Mississippi River remains closed after a...
(Bloomberg) — Two U.S. senators who pressed for the economic sanctions that have reduced Iran’s crude oil exports and earnings have proposed additional steps to force Iran to curb its suspected nuclear weapons program.
Senators Bob Menendez, a New Jersey Democrat, and Mark Kirk, an Illinois Republican, yesterday introduced new U.S. financial penalties on foreign businesses and banks involved in Iran’s energy, ports, shipping, and shipbuilding sectors, plus sanctions on metals trade with Iran.
The measure would target Iran’s main sources of revenue and seek to prevent it from evading sanctions by buying gold with local currency earnings. While almost all trade with Iran by any U.S. business or individual has long been banned, yesterday’s proposal would impose penalties on other nations’ trade with Iran, a step closer to imposing a trade embargo on Iran.
“Our sanctions are making a significant impact, but Iran is working just as hard to develop nuclear weapons,” Menendez said in remarks prepared for delivery on the Senate floor. “By passing these additional measures,” he said, the U.S. will send a message to Iran that it must make concessions on uranium enrichment, or face the strangulation of its economy.
The existing sanctions have weakened Iran’s currency, curtailed its oil exports, and forced Iran back to nuclear talks. Still, Iran hasn’t slowed its enrichment efforts, making new measures essential, Menendez said in an e-mail before his planned speech.
The U.S., European Union and Israel say Iran is secretly pursuing a nuclear weapons capability. Iran says its nuclear program is strictly for civilian energy and medical research.
Yesterday’s proposal would continue to allow purchases of Iranian crude as long as the buyer nation is able to show it’s significantly reducing its oil imports from Iran.
The new measure also allows for purchases of Iranian natural gas if payments are made in local currency into an account that Iran could use only for approved trade. That provision, according to advisers who’ve helped craft the legislation, is especially important for Turkey, a U.S. ally and NATO member that’s a major buyer of Iranian natural gas.
While the U.S. and EU say the sanctions forced Iran back to the negotiating table this year, talks stalled and no agreement has been reached despite the steady tightening of economic penalties on Iran.
Iran’s oil exports were down 1 million barrels a day last month, or 40 percent, compared with October 2011, U.S. Energy Department figures show.
Crude for January delivery climbed $1.58 to settle at $88.07 a barrel yesterday on the New York Mercantile Exchange. Prices are up 2.1 percent this month.
Yesterday’s proposal, offered as an amendment to the annual defense authorization bill now on the Senate floor, would include energy, ports, shipping and shipbuilding as sectors of the Iranian economy that support the country’s nuclear program and weapons proliferation. A vote on the amendment is scheduled for today.
If it’s passed by Congress and signed by President Barack Obama, the legislation also would make it illegal to do business or provide insurance or reinsurance to any Iranian business in those sectors or to any Iranian individual sanctioned by the U.S. government.
The proposed new amendment adds a special exemption from sanctions on oil transactions for a country that may be facing “exceptional circumstances” that make it impossible to further reduce imports of Iranian oil. A hypothetical case, according to those involved in crafting the measure, might be Japan, which is struggling to meet its energy needs in the aftermath of the March 11, 2011, Fukushima nuclear disaster.
The proposal is also aimed at blocking trade in commodities used in Iran’s shipbuilding and nuclear sectors, such as graphite, aluminum, steel, metallurgical coal and software for integrating industrial processes. The measure also seeks to stop Iran from circumventing sanctions by receiving payment in precious metals such as gold, or using oil payments in local currency to buy gold.
The proposal also would sanction Islamic Republic of Iran Broadcasting for human rights abuses, including airing alleged show trials and forced confessions, and would sanction anyone involved in diverting humanitarian goods to the black market.
Mark Dubowitz, who has advised members of Congress and the administration on pressuring Iran, praised the measure for addressing “the Iranian game of ‘catch me if you can’” by making it easier to crack down on front companies “and other sanctions-busting techniques, like the use of gold or other precious metals as a medium of exchange.”
The Senate defense bill is S 3254.
-By Laura Litvan and Indira A.R. Lakshmanan. Copyright 2012 Bloomberg.
Join the 68,626 members that receive our newsletter.
Have a news tip? Let us know.