Tuesday, January 17, 2012

Eye on Iran: Iran Cracks Down on Dollar Trades

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Top Stories


WSJ: "Iranian authorities sent police into the streets of the capital Monday to crack down on informal currency trading and support the rial, signaling Iranians' heightened insecurity over their dwindling buying power and Tehran's increasingly hard-handed efforts to stave off economic panic. The move follows last week's steep Iranian Central Bank interest-rate increase, a bid to try to stem the growing demand for U.S. dollars in the country as the economy lurches amid fears over a new round of sanctions promised by the U.S. and Europe. Iran's rial currency has declined 40% to 55% against the dollar on the black market since December. Iranian inflation, meanwhile, now exceeds 20% a month, according to the Central Bank." http://t.uani.com/z1jygf

NYT: "The escalating American confrontation with Iran poses a major new political threat to President Obama as he heads into his campaign for re-election, presenting him with choices that could harm either the economic recovery or his image as a firm leader. Sanctions against Iran's oil exports that the president signed into law on New Year's Eve started a fateful clock ticking. In late June, when the campaign is in full swing, Mr. Obama will have to decide whether to take action against countries, including some staunch allies, if they continue to buy Iranian oil through its central bank. After fierce lobbying by the White House, which opposed this hardening in the sanctions that have been its main tool in pressuring Tehran, Congress agreed to modify the legislation to give Mr. Obama leeway to delay action if he concludes the clampdown would disrupt the oil market. He may also invoke a waiver to exempt any country from sanctions based on national security considerations. But using either of those escape hatches could open the president to charges that he is weak on Iran, which is viewed by Western powers as determined to achieve a nuclear weapons capability and which has drawn a tough response from Europe as well." http://t.uani.com/x5e0xu

AFP: "Iran on Tuesday warned US ally Saudi Arabia to rethink plans to compensate for Iranian oil exports cut by sanctions, and boosted security for its targeted nuclear workers as it dug in under its showdown with the West. Foreign Minister Ali Akbar Salehi told Riyadh to 'reflect' on a vow to open its oil taps to make up for an imposed reduction in Iran's oil sales. He said such a position was viewed as 'not friendly.' At the same time, President Mahmoud Ahmadinejad has ordered security stepped up for all of Iran's nuclear workers following the assassination last week of a key scientist, First Vice President Mohammad Reza Rahimi said." http://t.uani.com/yllxJh

Iran Disclosure Project

Nuclear Program & Sanctions

Reuters: "Banks in Britain are poring over relationships with financial partners in fear of falling foul of fresh international sanctions against Iran. As part of a dispute between Western powers over Iran's nuclear programme, Britain has ordered its lenders to cut all ties with the country. Though UK banks largely ended their direct business with Iran in the last decade, their so-called 'correspondent banking' relationships with banks who do still deal with Iran could cause headaches for risk managers looking to save their employers a visit from regulators. Correspondent banks provide services for an overseas bank, such as establishing accounts or clearing, giving the overseas bank's customers access to an international network they might not otherwise have." http://t.uani.com/ypgB1l

Reuters: "South Korea, a key U.S. ally, warned the United States on Tuesday it would have difficulty replacing Iranian crude supplies and expressed concern that sanctions pressure could lead to higher oil prices. Washington wants Asia to cut crude imports from the OPEC member in a bid to pressure Tehran to rein in its nuclear ambitions, which Washington suspects are aimed at making nuclear weapons. It has already secured agreement from European Union states to ban Iranian crude imports. Japan's Finance Minister Jun Azumi reiterated on Tuesday that Japan would cut Iranian oil imports, although Prime Minister Yoshihiko Noda raised doubts about the country's policy last week by dismissing Azumi's view as 'personal opinion.'" http://t.uani.com/yVVqnA

AP: "An Iranian news website is reporting that several suspects have been arrested over last week's killing of an Iranian nuclear scientist. Ali Larijani, speaker of the Iranian parliament, said the suspects are being interrogated, and the investigation is continuing. He talked to Iran's state Arabic language TV channel Al-Alam, and his comments were carried on the Tabnak.ir site. Mostafa Ahmadi Roshan, an official at Iran's nuclear-enrichment facility in Natanz, was killed in an explosion Wednesday after attackers attached a bomb to his car in Tehran. Iran accused the U.S., Britain and Israel of involvement." http://t.uani.com/wjH4sH

Reuters: "A nuclear-armed Iran could deter Israel from going to war against Tehran's guerrilla allies in Lebanon and the Gaza Strip, a senior Israeli general said on Tuesday... Eshel made clear that Israel - widely reputed to have the region's only atomic arsenal - worries that Syria and Lebanon's Hezbollah militia as well as Palestinian Hamas Islamists who rule Gaza could one day find reassurance in an Iranian bomb. 'They will be more aggressive. They will dare to do things that right now they would not dare to do,' he said in a briefing to foreign journalists and diplomats. 'So this is going to create a dramatic change in Israel's strategic posture, because if we are forced to do things in Gaza or Lebanon under an Iranian nuclear umbrella, it might be different.'" http://t.uani.com/wcHMgh

The National: "Global sanctions against Iran threaten to stall the building of a thermal power station under the country's first public-private partnership (PPP). There were uncertainties about the impact of the sanctions on a licensing deal between the German engineering firm Siemens and a local company making parts for the 150 megawatt plant, said Walid Abdelwahab,a director of the Islamic Development Bank (IDB), which is acting as a private investor in the project. 'We are carrying out due diligence on the project to understand the impact of the sanctions on the capacity of the local company to still manufacture complete equipment,' he said. 'The company has a licence from Siemens but we don't know what the situation is on that licence.'" http://t.uani.com/xZG8o1

Foreign Affairs


AP: "Iranian state radio says Tehran will give the United States a model of the American surveillance drone captured by the Islamic Republic. The report Tuesday said the toy model of the RQ-170 Sentinel stealth drone will be sent to the White House in response to a formal request from Washington last month asking Iran to return the aircraft that went down over Iran in December. State radio said the model will be one eightieth the size of the original aircraft. The report says the models also will be sold on the Iranian market for about 70,000 rials, or around $4." http://t.uani.com/x08IKK

Daily Telegraph: "Iran on Tuesday denied an allegation from France that it was sending weapons to its ally Syria in violation of a UN embargo. 'The declarations from French officials are incorrect,' Iranian foreign ministry spokesman Ramin Mehmanparast told reporters in a regular weekly briefing. 'Unfortunately we often see political positions by officials from some European countries, this time by France, that are baseless and not backed by proof,' he said. France's foreign ministry said on Monday that Iran has repeatedly violated a UN arms embargo by exporting weapons to Syria, which is roiled by internal strife." http://t.uani.com/xwlaBO

Opinion & Analysis


Reuel Marc Gerecht & Mark Dubowitz in Bloomberg: "Iran's threat to close the Strait of Hormuz, the choke-point for Persian Gulf oil shipments, reveals how deeply the latest Western sanctions -- and the threat of even tougher measures -- have spooked the clerical regime. Yet, as the U.S. and its allies aim to tighten the noose, they have to consider two new realities. First, given the progress we now know Iran has made on its atomic-weapons programs, there is little reason to think the leadership will voluntarily disarm. (Unfortunately, if a nuclear-armed Iran is truly unacceptable, military action is the most likely route to success -- and the window for that option is closing fast.) Second, if we are going to pursue tougher international sanctions against Iran -- and we should -- the goal should be regime change in Iran, not stopping proliferation. In fact, regime change would make the idea of an Iranian bomb far more tolerable. For the first time since Iraq invaded Iran in 1980, Iran's leadership fears for its oil wealth. Yet the Barack Obama administration, which has justifiably applauded itself for advancing sanctions, appears hesitant to implement aggressively Congressional legislation against Iran's central bank -- the punishment the clerical regime dreads most, as it is the critical financial institution for petroleum sales." http://t.uani.com/zNGaWh

Max Fisher in The Atlantic: "Chinese Prime Minister Wen Jiabao is on a six-day trip to three of the Middle East's major oil producers: Saudi Arabia, Qatar, and the United Arab Emirates. All three are close U.S. allies; a Chinese Prime Minister has not visited Saudi Arabia in two decades. But the biggest news here may be the Middle Eastern energy exporter he isn't visiting: Iran, China's third-greatest source of oil. There's no reason to believe that the China-Iran relationship is ending, but this is another indication that China's interest in dealing with Iran may be waning. If that happens, it would do wonders for America's containment strategy, and Washington might have Israel -- and perhaps Tehran itself -- to thank. The Tehran-Beijing relationship is an important one to both countries. Because international sanctions keep Western firms out of Iran, Chinese state-owned enterprises have found it rife with development opportunities and favorable trade deals, including 11% of the Chinese oil imports helping to fuel China's growing economy. Iran desperately needs China, its biggest buyer, to displace Western business and keep its increasingly troubled economy afloat. But the relationship is far more important for Iran, where the leadership likely fears that a drop in oil exports could return protesters to the streets, than it is for China. (Iran also needs China's support at the United Nations Security Council -- or, rather, they need China to continue opposing Western-led efforts at UNSC sanctions against Iran. But their opposition may not be especially predicated on the Beijing-Tehran economic relationship, as both China and Russia have long insisted that whatever a country does internally is basically none of the UN's business, and China would likely oppose sanctions even if it did not buy energy from Iran.) That relationship may not be as stable as it was just a few years ago. In January, China cut its Iranian imports by 40% over a pricing dispute. As China attempts to slow down its economy, its appetite for energy will not drive foreign policy quite as completely. Wen's visit to other oil-producing Persian Gulf states is widely seen as an attempt to diversify Chinese oil imports, a smart move given the region's notorious political instability. And the U.S., China's most important trading partner by far, is strongly urging it and other Asian nations to reduce their Iranian imports. But another contributor to Beijing's apparent drift away from Tehran may be a fear that Iranian oil will not always flow reliably. Though China wants to slow its economic growth, a sudden drop in its energy imports could be disastrous. And Iranian energy looks less secure than ever." http://t.uani.com/zuqAkv

Leslie Gelb in The Daily Beast: "We're doing this terrible thing all over again. As before, we're letting a bunch of ignorant, sloppy-thinking politicians and politicized foreign-policy experts draw 'red line' ultimatums. As before, we're letting them quick-march us off to war. This time their target is Iran. And heaven knows Iran's leaders are bad guys capable of doing dangerous things. But if we've learned anything, anything at all, from plunging into war in Vietnam, Iraq, and Afghanistan, it is this: we must have a public scrubbing of fighting rhetoric before, not after, the war begins. Sure, there are risks in acting so sensibly. It does signal hesitation, even weakness, to the adversary. But to me, the far greater risk lies in not hesitating. The real risk is not fully, thoroughly, and publicly laying bare the case for war. In every major war of the last decades, the public assumed the government and the experts knew what they were talking about and proposing to do. But after a year or so, that faith collapsed. Except for those who would bless the sound of the cannon wherever it led, everyone soon realized the terrible truth: that government leaders had little or no idea what they were doing, what the invaded country was really like, and what could and could not be accomplished at what cost. By then, it was too late. Once our truly precious troops had been sacrificed and our prestige had been cast upon the waters, patriotism and politics overwhelmed reason. For our own sake, don't let this happen again. Let's have carefully planned and extended public hearings on the pros and cons of war with Iran. Let those hearings be conducted by the Senate Foreign Relations Committee or a special public commission established by President Obama. Let's do the job painstakingly and systematically, especially because Election Day beckons with its talons of stupidity and rashness. Yes, yes, I realize full well that a public pretrial is far from a perfect or even a good solution. But I cannot think of another way to slow down our familiar passive march toward war, and compel its drum majors to parade their plans on why the war must be fought and how it can be won. Hearings will surely confuse a lot of people, but at least give them their democratic chance to judge. To step back, there are two issues likely to spark fighting with Iran: Tehran's threat to block an internationally recognized waterway at the Strait of Hormuz, and its relentless moves toward acquiring nuclear weapons." http://t.uani.com/xJvrJG

Eye on Iran is a periodic news summary from United Against Nuclear Iran (UANI) a program of the American Coalition Against Nuclear Iran, Inc., a tax-exempt organization under Section 501(c)(3) of the Internal Revenue Code. Eye on Iran is not intended as a comprehensive media clips summary but rather a selection of media elements with discreet analysis in a PDA friendly format. For more information please email Press@UnitedAgainstNuclearIran.com

United Against Nuclear Iran (UANI) is a non-partisan, broad-based coalition that is united in a commitment to prevent Iran from fulfilling its ambition to become a regional super-power possessing nuclear weapons. UANI is an issue-based coalition in which each coalition member will have its own interests as well as the collective goal of advancing an Iran free of nuclear weapons.

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