Kerry Seeking Pause in New Iran Sanctions While Talks Continue

The Obama administration pressed Congress to give diplomacy a chance, parrying attacks from Capitol Hill, Israel and Iran over talks that broke up last week without a deal to curb Iran’s nuclear program.

Secretary of State John Kerry will meet tomorrow with the Senate Banking Committee to urge lawmakers to hold off, at least temporarily, on proposals to increase economic pressure on Iran by imposing additional sanctions.

“This is not about being for or against sanctions,” White House spokesman Jay Carney told reporters today in a briefing. “This is a decision to support diplomacy and a possible peaceful resolution to this issue.”

Lawmakers from both parties in Congress and Israeli Prime Minister Benjamin Netanyahu have criticized negotiations in Geneva last week toward a first-step agreement on limiting Iran’s nuclear program that would ease some existing sanctions without first ensuring an end to Iran’s uranium enrichment.

The talks in Geneva broke up last weekend without an initial agreement and are scheduled to resume Nov. 20. Iran is negotiating with a group known as the P5+1, made up of the five permanent members of the UN Security Council -- the U.S., U.K., France, Russia and China -- plus Germany.

Senate Foreign Relations Committee Chairman Robert Menendez, a leading advocate for heightened sanctions, said he will await a briefing by Kerry tomorrow before deciding on a course of action.

‘Insurance Policy’

Additional sanctions would send a message to Iran that “we are serious of purpose” and “would be an insurance policy for the United States and the West if Iran doesn’t ultimately strike a deal,” Menendez, a New Jersey Democrat, said in an interview on CNN.

Even if Congress acts, legislation would take “anywhere between six months and a year” to implement, Menendez said. “They always take time to kick into effect.”

New sanctions legislation should come from the banking panel, Menendez told reporters. The senator had said previously that he might attempt to attach sanctions language to the fiscal 2014 defense authorization bill the chamber is preparing to debate.

Senator Mark Kirk, an Illinois Republican on the Banking Committee, said in an e-mail that sanctions “remain the best way to avoid a war and prevent a future of Iranian nuclear weapons.”

Tennessee Senator Bob Corker, the top Republican on the Foreign Relations Committee and a member of the banking panel, said he wants to hear what Kerry has to say about the Geneva negotiations before deciding how to proceed.

Keeping Leverage

“We’re just worried that they’re dealing away our leverage,” Corker said in an interview. “What we’re far more concerned about in our office is the administration dealing away the sanctions that we now have in place.”

Kerry will tell lawmakers that “putting new sanctions in place would be a mistake while we are still determining if there’s a diplomatic path forward,” State Department spokeswoman Jen Psaki told reporters today. “This is about ensuring that our legislative strategy and our negotiating strategy are running hand-in-hand.”

The agreement that was considered during talks in Geneva would have offered Iran a temporary easing of existing sanctions on petrochemicals, gold and auto trade and some access to frozen assets, according to diplomats who asked not to be identified because they weren’t authorized to comment.

Netanyahu, who has said Geneva negotiators were working toward a “bad and dangerous” deal, said today that Iran stands to gain billions of dollars if sanctions are eased in the proposal being discussed in Geneva.

‘Tremendous Break’

“It gives Iran a tremendous break, a hole -- not a tiny hole, but a big hole -- in sanctions,” Netanyahu said at the Bloomberg Fuel Choices Summit in Tel Aviv.

The U.S. and Israel say uranium enrichment in Iran and construction of a reactor capable of producing plutonium would help the Islamic Republic develop the capability to produce nuclear weapons. Iran says its nuclear program is for peaceful medical and energy uses.

Kerry and other administration officials, including Vice President Joe Biden and Treasury Secretary Jack Lew, have been urging Congress for weeks to hold off on sanctions legislation during talks toward an agreement with an Iranian government that’s expressed greater willingness to negotiate over its nuclear program under new President Hassan Rouhani.

Iranian Foreign Minister Mohammad Javad Zarif aired his own complaints with Kerry, after the top U.S. diplomat said yesterday that the Geneva negotiations ended without a deal because Iran wasn’t ready to agree to a proposal from the six world powers.

No Blame

“No amount of spinning can change what happened” in Geneva, Zarif said in a Twitter Inc. posting yesterday. “But it can further erode confidence.”

Psaki said Kerry was “stating the facts of why we didn’t come to an agreement” and wasn’t trying to place blame on Iran.

“It’s not about blame,” she said. “We came out of Geneva having made more progress and closer to an agreement than when we came in.”

With “very complicated” issues, it’s “only natural that they would have to go back and discuss” the proposal’s terms in Tehran, Psaki said. “We are focused on continuing to narrow the gaps and on the negotiations continuing next week.”

To contact the reporter on this story: Bob Drummond in Washington at bdrummond@bloomberg.net

To contact the editor responsible for this story: John Walcott at jwalcott9@bloomberg.net

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