You are here

Iran says it will resist 'economic war' as US revives sanctions

Teheran says it will sell oil in breach of curbs; major oil customer China regrets American move

Washington

IRAN said it would defy United States sanctions reimposed on it by Washington on Monday, denouncing as "economic war" the US attempt to curb Teheran's missile and nuclear programmes and weaken its influence in the Middle East.

The US move restores sanctions lifted under a 2015 nuclear deal negotiated by the administration of President Barack Obama and five other world powers. It adds 300 new designations in Iran's oil, shipping, insurance and banking sectors.

European powers which continue to back the nuclear deal said they opposed the reimposition of sanctions and major oil buyer China said it regretted the move.

sentifi.com

Market voices on:

The restoration of sanctions is part of a wider effort by US President Donald Trump to force Iran to further limit its nuclear work and to halt its missile programme as well as its support for proxy forces in Yemen, Syria, Lebanon and other parts of the Middle East.

Switzerland said it is holding talks with the US and Iran about launching a humanitarian payment channel to help food and drugs keep flowing to Teheran.

US sanctions permit trade in humanitarian goods such as food and pharmaceuticals, but measures imposed on banks and trade restrictions could make such items more expensive.

US Secretary of State Mike Pompeo said on Sunday the penalties set to return on Monday "are the toughest sanctions ever put in place on the Islamic Republic of Iran".

However, Iran's clerical rulers have dismissed concerns about the impact of sanctions on the economy.

"Today the enemy (the United States) is targeting our economy...the main target of sanctions is our people," Iranian President Hassan Rouhani said.

"America wanted to cut to zero Iran's oil sales... but we will continue to sell our oil... to break sanctions," Mr Rouhani told economists.

The sanctions were illegal and unfair, he said."This is an economic war against Iran but... America should learn that it cannot use the language of force against Iran... We are prepared to resist any pressure," Mr Rouhani added.

Reiterating Iran's position that the Trump administration is not a trustworthy partner for talks, Mr Rouhani said: "Holding talks is not an issue for us - only if the other party respects its commitments and promises."

Mr Trump announced in May his government was withdrawing from what he called the "worst ever" agreement negotiated by the US.

The other parties to the deal - Britain, France, Germany, China and Russia - say they will not leave.

The deal had seen most international financial and economic sanctions on Iran lifted in return for Teheran curbing its disputed nuclear activity under UN surveillance.

The European Union, France, Germany and Britain said in a joint statement that they regretted the US decision and would seek to protect European companies doing legitimate business with Teheran.

China, India, South Korea, Japan and Turkey - all top importers of Iranian oil - are among eight countries expected to be given temporary exemptions from the sanctions to ensure crude oil prices are not destabilised.

The countries will deposit Iran's revenue in an escrow account, US officials have said.

News of the waivers helped lower oil prices early on Monday, since they allow major buyers to import Iran's oil for a while.

Brent crude was down 15 cents a barrel at US$72.68 by 1030 GMT. US light crude CLc1 was 30 cents lower at US$62.84.

Mr Rouhani said even without the waivers Iran would still be able to sell its oil, semi-official Tasnim news agency reported.

The Iranian military launched two days of air defence drills on Monday across northern Iran, and state TV aired footage of surface-to-air missiles and air defence systems. Iran's elite Revolutionary Guards Corps are among the forces participating.

The curbs come as the United States is focused on US congressional and gubernatorial elections on Tuesday.

Campaigning in Chattanooga, Tennessee, on Sunday, Mr Trump said his "maximum pressure" against Iran was working.

"Iran is a much different country than it was when I took office," said the American president, adding: "They wanted to take over the whole Middle East. Right now they just want to survive." REUTERS