U.S. Holds Military Talks With Israel on Iran
Chairman of the U.S. Joint Chiefs of Staff Martin Dempsey
Karen Bleier/AFP/Getty Images
Army General Martin Dempsey, the chairman of the U.S. Joint Chiefs of Staff, arrived in Israel yesterday for talks with Prime Minister Benjamin Netanyahu , Defense Minister Ehud Barak and other officials.
Army General Martin Dempsey, the chairman of the U.S. Joint Chiefs of Staff, arrived in Israel yesterday for talks with Prime Minister Benjamin Netanyahu , Defense Minister Ehud Barak and other officials. Photographer: Karen Bleier/AFP/Getty Images
America's most-senior military officer is due to meet Israeli leaders today to discuss Iran’s nuclear program, a day after European Union governments reached a preliminary agreement to freeze the assets of the Iranian central bank.
Expanding beyond their planned sanctions on Iranian oil, diplomats from the 27-nation EU agreed yesterday on how to undertake measures against the Central Bank of Iran, according to an EU diplomat with knowledge of the matter. The action would allow opt-outs from the asset freeze on a case-by-case basis to protect European trade with Iranian entities not covered by sanctions, said the diplomat, who asked not to be identified because the talks are private.
Army General Martin Dempsey, the chairman of the U.S. Joint Chiefs of Staff, arrived in Israel yesterday for talks with Prime Minister Benjamin Netanyahu, Defense Minister Ehud Barak and other officials. Defense Secretary Leon Panetta and other U.S. officials have warned Israel not to strike Iran’s nuclear facilities, which might trigger retaliatory attacks as well as a naval confrontation in the Strait of Hormuz.
The dangers include missile attacks on American bases in Kuwait, Bahrain and Qatar as well as Iranian-sponsored terrorist attacks on U.S. government personnel and civilians in Iraq, Afghanistan and elsewhere in the region and beyond, two U.S. defense officials said this week. Both spoke only anonymously because they aren’t authorized to talk to the news media.
Downplaying Israeli Strike
Israeli leaders such as Netanyahu have said that a nuclear- armed Iran would pose an “existential threat” to the Jewish state that may require Israeli military action to prevent if diplomacy fails.
“Nuclear arms in Iran are a threat to Israel, the region and the world,” he said in a speech in Amsterdam Jan. 18. “Sanctions should be applied to Iran’s central bank, its oil exports and they should be applied now.”
Any decision on whether to take military action against Iranian nuclear facilities is “very far off,” Barak told Israel’s Army Radio Jan. 18, adding “I don’t want to give estimates; it’s definitely not urgent.”
Iranian officials have threatened to close the Strait of Hormuz, through which almost 20 percent of the world’s oil flows, in the event of military strikes or a blockade of oil shipments over its nuclear program.
Iran, the second-largest oil producer in the Organization of Petroleum Exporting Countries after Saudi Arabia, says its nuclear program is for civilian purposes only.The U.S., EU and Israel suspect the program is a cover for the development of weapons capabilities.
The International Energy Agency yesterday said it sees no urgency to release oil stockpiles amid Iranian threats to oil shipping, according to Fatih Birol, the group’s chief economist.
Monitoring Oil Shipping
“What we are doing is following the markets closely and, for the time being, we do not see any reason to take action,” he said in an interview before a speech at Imperial College in London. “It is too early to talk about the blockade of any choke points.”
The Iranian threats have prompted Tupras Turkiye Petrol Rafinerileri AS (TUPRS), which operates refineries in Turkey, to seek alternative suppliers, Greece’s state-run ANA news agency said yesterday. Tupras wants to secure an alternate source by mid- year and plans to meet soon with Saudi Arabian authorities, the Athens-based agency reported, without saying where it got the information.
Jan. 23 Meeting
EU foreign ministers are due to decide on their oil embargo and central bank asset freeze at a Jan. 23 meeting in Brussels. Yesterday’s meeting left it to the ministers to determine the timing of the oil ban, according to the EU diplomat, who said European governments probably would decide to exempt existing contracts until the end of June.
Maja Kocijancic, an EU foreign-policy spokeswoman, declined to comment when reached yesterday by telephone.
The proposed phase-in of the oil embargo, which requires unanimity among the bloc’s 27 states, would allow nations including Greece, Italy and Spain to find alternate suppliers. Those three countries accounted for about 68 percent of EU imports from Iran in 2010, European Commission data show.
The proposed start of a full embargo on July 1 may be a compromise between countries led by France, which have been urging the shortest delay, and the nations most dependent on Iranian oil, which originally pressed for an exemption of as long as 12 months, said another EU diplomat, who declined to be named because the talks are confidential.
Sticking Points
In talks yesterday, the timing was not resolved as Greece stuck to its demand for an eight-month delay while a majority of the EU supported six months, according to a European source informed about the talks. There is agreement for EU restrictions on Iran petrochemicals to start May 1 and for a ban on movement of gold to and from Iran, he said, asking not to be identified speaking about the negotiations.
EU sanctions on Iran already include an embargo on equipment for and investment in the oil and natural gas industries. The bloc also has imposed restrictions on transfers of funds to and from Iran.
Crude for February delivery slid 20 cents, or 0.2 percent, to settle at $100.39 a barrel on the New York Mercantile Exchange. Oil has gained 17 percent in the past three months.
The oil ban would cover imports of Iranian oil to Europe, purchases out of Iran into non-EU countries, transport of oil from Iran as well as finance and insurance of oil contracts, according to one EU diplomat. It would apply to all companies under the EU law, including subsidiaries of foreign companies registered in Europe and branches of EU companies based outside the continent, the diplomat said.
Bank Sanctions
In addition, the EU is discussing whether to impose sanctions on Bank Tejarat, the last major Iranian bank financing large-volume trade in Europe, according to EU diplomats and sanctions specialists close to the negotiations.
The move may complicate tens of billions of dollars in annual trade with Europe and monetary transactions by EU diplomatic missions in Tehran, they said. That action was not resolved yesterday, officials said.
Some EU officials have objected to an asset freeze because Bank Tejarat is used by EU countries with diplomatic missions in Tehran, according to a European diplomat, who spoke on condition of anonymity. If the bank is subject to sanctions, EU embassies and their staffs would have to carry cash and pay for transactions in euros, said the official, who had been briefed by his foreign ministry.
To contact the reporters on this story: Ewa Krukowska in Brussels at ekrukowska@bloomberg.net; Jonathan Stearns in Brussels at jstearns2@bloomberg.net
To contact the editor responsible for this story: John Walcott at jwalcott9@bloomberg.net
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