Saturday

21st Sep 2019

US scorns EU bailout of Iran deal

  • US-Iran confrontation has increased danger for oil shipping in the Gulf (Photo: European Community)

Gulf tensions have intensified after Iran reacted to US threats by speeding up nuclear enrichment.

The EU had put up $15bn (€14bn) to bailout international diplomacy.

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But hawkish US talk derailed the French-led initiative.

"From Friday (6 September), we will witness research and development on different centrifuges ... needed for enriching uranium in an accelerated way," Iranian president Hassan Rohani said on state TV on Wednesday.

"It is unlikely that we will reach a result with Europe by today or tomorrow," he added.

The centrifuge step would put Iran in further violation of a nuclear arms control pact designed to keep peace in the Middle East.

The EU-backed Joint Comprehensive Plan of Action (JCPOA) on nuclear arms began to unravel after the US walked out of the deal in 2018 and reimposed oil sanctions on Iran.

Rohani spoke a few hours after a US diplomat belittled an EU idea to loan Iran $15bn for sanctions relief.

"There is no concrete proposal. We have no idea if there will be one. So we're not going to comment on something that doesn't exist," Brian Hook, the state department's Iran envoy, said.

He announced new sanctions on 16 Iranian entities and 10 individuals.

"There will be more sanctions coming. We can't make it any more clear that we are committed to this campaign of maximum pressure," he also said.

France had tried to broker the loan project, inviting Iranian deputy foreign minister Abbas Araghchi to Paris for talks earlier this week.

Its foreign minister, Jean-Yves le Drian, had also spoken of "a credit line guaranteed by [Iranian] oil in return".

The credit line came on top of earlier EU plans to create an oil trading entity, called the Instrument in Support of Trade Exchange (Instex), which could bypass US sanctions.

But Instex is not yet operational and is to trade in food and medicine but not oil in its initial phase.

If Europe made good on its promises, then Iran might still row back from confrontation, Araghchi said on Wednesday.

"Iran ... will return to full implementation of the JCPOA only if it is able to sell its oil and to fully benefit from the income," he said.

"The French proposal goes in that direction," he added.

"Full implementation ... is subject to receiving $15bn over a period of four months, otherwise the process of Iran reducing its commitments will continue," he said.

But "I don't think European countries will be able to take an effective step before Friday," he warned.

The US-Iran confrontation has increased danger for oil shipping in the Gulf, amid tit-for-tat tanker seizures.

For his part, Hook, the US envoy, has personally emailed "roughly a dozen" tanker captains in the region threatening to blacklist them if they shipped Iranian oil, the state department confirmed on Wednesday.

"Having failed at piracy, the US resorts to outright blackmail - deliver us Iran's oil and receive several million dollars or be sanctioned yourself," Iran's foreign minister Mohammad Javad Zarif said in reaction.

"Sounds very similar to the Oval Office invitation I received a few weeks back. It is becoming a pattern," he added, claiming the US had threatened to blacklist him as well if he did not go to Washington for talks.

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