The House of Representatives easily passed a bill on Wednesday to tighten sanctions on Iran, showing a strong message to Tehran over its disputed nuclear program days before President-elect Hassan Rouhani is sworn in. The vote also highlighted a growing divide between Congress and the Obama administration on Iran policy ahead of international talks on the nuclear program in coming months. Iran insists the nuclear program is purely for civilian purposes.
The bill, which passed 400 to 20, would cut Iran's oil exports by another 1 million barrels per day over a year to near zero, in an attempt to reduce the flow of funds to the nuclear program. It is the first sanctions bill to put a number on exactly how much Iran's oil exports would be cut.
The legislation provides for heavy penalties for buyers who do not find alternative supplies, limits Iran's access to funds in overseas accounts and penalises countries trading with Iran in other industrial sectors. Existing US and EU measures have already reduced Iran's oil exports by more than half from pre-sanction levels of about 2.2 million barrels per day (bpd), costing Tehran billions of dollars in lost revenue a month.
Most of the Opec member's exports head to Asia, where the United States has worked with Iran's top four customers China, India, Japan and South Korea to push them towards alternative suppliers. The four have cut purchases from Iran by more than a fifth in the first half of this year, over and above the reductions made last year. The success of any toughening of the sanctions will depend on China, Iran's top customer, which has repeatedly said it opposes unilateral sanctions outside the purview of the United Nations, such as those imposed by the United States. The country reduced oil purchases from the Middle Eastern nation by 21 percent last year, but that was partly on account of differences in the first quarter over the renewal terms of annual contracts and shipping delays.
Comments
Comments are closed.