Netanyahu Says Iran Stands to Gain Billions in Relief

Israeli Prime Minister Benjamin Netanyahu said Iran would reap billions of dollars under a deal to ease economic sanctions that negotiators almost reached at nuclear talks in Geneva last week.

“It gives Iran a tremendous break, a hole -- not a tiny hole, but a big hole -- in sanctions,” Netanyahu said late yesterday in a speech to the Bloomberg Fuel Choices Summit in Tel Aviv. It would gain “several billion dollars’ worth that is augmented to much more.”

Netanyahu has urged President Barack Obama and other world leaders to reject any deal with Iran that doesn’t dismantle its nuclear program, and opposed the accord that was offered to Iran by world powers in Geneva last week.

The Geneva talks broke up Nov. 9 without agreement on an offer to ease some economic sanctions on the Islamic republic in return for limited restrictions on its nuclear program. Negotiations are due to resume on Nov. 20.

The Israeli leader’s skepticism about the Iran deal has drawn barbs from U.S. Secretary of State John Kerry, who returned from Geneva to face critics in Congress who want to impose tougher sanctions. Like Netanyahu, they say further penalties would force Iran to curtail its nuclear ambitions. Kerry is due to brief lawmakers about the Geneva talks today.

Discussing the need to develop alternative fuels to reduce dependence on oil, Netanyahu said Israel is spending “one half of one percent of our oil import bill on this project.” He said oil is “a source of tremendous international instability.”

Gas Discoveries

The government has set a goal of cutting 60 percent from oil use in transportation by 2025 and has earmarked $420 million over 10 years to encourage research and investment. It says switching from oil will contribute more than 1 percentage point to gross domestic product by 2025.

Israel’s discovery in recent years of about 29 trillion cubic feet of natural gas in deep-water wells off its Mediterranean coast has eased the nation’s reliance on imported energy. Energy Minister Silvan Shalom says gas production will save Israel as much as $1 billion a month by 2015.

Israel has increased tax rates on gas and oil production and created a sovereign wealth fund that it says will help avert an appreciation in the shekel because of the new revenue.

Until the gas discoveries, Israel depended almost entirely on energy imports. Because its oil-rich Arab neighbors won’t sell it fuel, Israel has had to haul crude from countries as far away as Mexico. It now buys most of its fuel from the former Soviet Union, according to a government website.

To contact the reporters on this story: Jonathan Ferziger in Tel Aviv at jferziger@bloomberg.net; Gwen Ackerman in Jerusalem at gackerman@bloomberg.net

To contact the editor responsible for this story: Andrew J. Barden at barden@bloomberg.net

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