U.S. Imposing Sanctions on Libya, Shutting Down Embassy

President Barack Obama took the first step in what his administration said will be a series of sanctions against the Libyan government, signing an order freezing any U.S. assets of Muammar Qaddafi, his family and members of his regime.

Following the departure of diplomatic personnel and other Americans from Libya yesterday, the Obama administration also temporarily shuttered the U.S. embassy in Tripoli and said no options, including military action, have been ruled out.

Qaddafi and his associates “have taken extreme measures against the people of Libya, including by using weapons of war, mercenaries, and wanton violence against unarmed civilians,” reads the order, signed by Obama last night.

In a separate statement, Obama criticized the Libyan government for its “continued violation of human rights, brutalization of its people, and outrageous threats” and said the regime must be held accountable.

“We will stand steadfastly with the Libyan people in their demand for universal rights, and a government that is responsive to their aspirations,” he said.

Violence between supporters of Qaddafi and opposition groups has raged for more than 10 days, and there were reports from Libya that worshipers were being shot as they left mosques after Friday prayers. Qaddafi continued to cling to power as his opponents consolidated control of the eastern part of the country and violence worsened in the capital.

United Nations

The U.S. will work with the United Nations on additional sanctions against Qaddafi, White House press secretary Jay Carney said. The asset freeze is “a first step,” he said. “We continue to review our options going forward.”

Qaddafi and four of his children are named in the executive order and the U.S. departments of Treasury and State will identify other officials and family members who may be subject to the order, Stuart Levey, the Treasury Department’s under secretary for terrorism and financial intelligence, told reporters last night.

“We do have reason to believe that there are substantial funds of money that will be blocked by this action and therefore preserved for the Libyan people and protected from being looted by the regime,” he said. “Those assets will stay in place until we release them.”

Monitoring Libya

Carney said the U.S. will use the “full extent” of its intelligence capabilities to monitor the regime’s actions. Asked whether the U.S. military may get involved, Carney said that no options have been taken “off the table.”

Pressure was building for firmer action against Libyan authorities. A group of 41 former U.S. administration officials and human-rights activists urged Obama and NATO to deploy military forces to create a no-fly zone over Libya to prevent Qaddafi from using aircraft to attack civilians, as did Senators John McCain, an Arizona Republican, and Joseph Lieberman, a Connecticut independent.

Analysts said the chaos in Libya limits the steps the U.S. can take now.

“The only thing that can have immediate impact are statements which can give people a sense of their options going forward,” said Jon Alterman, Middle East analyst at the Center for Strategic and International Studies in Washington. “The information picture is so cloudy that it’s hard to do a lot of effective things through diplomatic channels.”

‘A Certain Caution’

Marina Ottaway, director of the Middle East program at the Carnegie Endowment for International Peace in Washington, said the administration was initially hamstrung by Americans trapped in the country, most of whom were evacuated yesterday by ferry to Malta and by chartered aircraft to Turkey.

“There is a certain caution on the part of the U.S.,” she said. “That said, I am not sure we are going to see a dramatic change afterwards because the choices for intervention are very limited.”

The turmoil in Libya and concern that it may spread helped push crude oil to its biggest weekly gain in two years. Crude for April delivery climbed 60 cents, or 0.6 percent, to settle at $97.88 a barrel on the New York Mercantile Exchange yesterday. Futures are up 25 percent from a year ago.

Obama plans to meet with UN Secretary General Ban Ki-moon on Feb. 28 to discuss coordinated action, Carney said. Obama consulted with President Nicolas Sarkozy of France, U.K. Prime Minister David Cameron and Italian Prime Minister Silvio Berlusconi on Feb. 24 and spoke yesterday with Turkish Prime Minister Recep Tayyip Erdogan.

Additional Sanctions

France and the U.K. submitted a plan for an arms embargo and other sanctions against Libya at a meeting of the UN Security Council yesterday. U.S. Secretary of State Hillary Clinton will travel to Geneva to meet on Feb. 28 with her counterparts to discuss suspending Libya from the UN Human Rights Council. During its meeting yesterday, the council approved a recommendation to move ahead with the suspension.

While saying Libya’s future must be decided by its citizens, Carney said Qaddafi’s “legitimacy has been reduced to zero in the eyes of his people.”

Carney said the administration waited until U.S. nationals had been safely evacuated to announce the steps it is taking.

“This has been a very rapid effort to work with our international partners to analyze and select the options we want to take,” he said. “There has been great haste” to move ahead on sanctions.

At the State Department, spokesman Philip J. Crowley said the embassy shut down, because the safety of personnel could no longer be guaranteed, would be temporary. The U.S. maintains diplomatic relations with Libya, he said.

To contact the reporters on this story: Nicholas Johnston in Washington at njohnston3@bloomberg.net;

To contact the editor responsible for this story: Mark Silva at msilva34@bloomberg.net

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