Israel Matzav

Just how difficult is it to sanction Iran?

With all of the talk about imposing sanctions on Iran in a bid to discourage their nuclear program, I've wondered just how difficult those sanctions are to impose. According to this article by Cliff May, they're actually fairly easy to impose. But even the United States government - under both Bush and Obama - has failed to get the job done.

Iran is one of the world’s leading oil exporters, but it has not invested much in oil refineries — it has spent its money on nuclear development instead. As a result, Iran must import almost half the gasoline it consumes. Just a few companies have been filling its tanks. The most important of them is Vitol, a Swiss firm.

Last Friday, a bipartisan group of House members — Howard Berman, Brad Sherman, Ileana Ros-Lehtinen, Robert Wexler, Mark Kirk, Rob Andrews, and Edward Royce — sent a letter to Energy Sec. Steven Chu, asking him to reconsider a federal-government contract awarded to Vitol in January, just days before the Bush administration left office.

They noted that Vitol has a checkered history, for example, pleading guilty, in 2007, “to grand larceny in New York state court in connection with kickbacks to the Iraqi government” in the Oil-for-Food scandal orchestrated by Saddam Hussein. That alone, the congressmen wrote, “could provide sufficient grounds for debarment from federal contracting.”

Orde Kittrie, a former State Department official and now a senior fellow at the Foundation for Defense of Democracies (the think tank I run) notes that in recent days, Adm. Mike Mullen, chairman of the Joint Chiefs of Staff, has announced that Iran has stockpiled enough nuclear fuel to make a bomb, and that Iran has launched a satellite. “We are five minutes from midnight in terms of opportunities to stop Iran from acquiring the capacity to launch a nuclear-armed missile,” Kittrie says. “The time is now to change Iran’s cost-benefit analysis by cutting off its supply of imported gasoline. One very important step in that direction would be to put Vitol to a choice between selling to Iran and selling to the United States.”

If nothing else, this would send the mullahs a message that there are non-military ways to cause them discomfort — even without the participation of the U.N. and European governments. A shortage of imported gasoline would further weaken Iran’s already unhealthy economy. Faced with that prospect, the ruling mullahs would ask themselves the question that is always foremost on their minds: “What best protects our hold on power?”

The answer is probably not to remind Iranians that, after 30 years, the Islamic Revolution has brought them economic deprivation and political oppression — and not even enough gasoline to keep their cars running.

As it happens, I believe it is too late for sanctions against Iran to work. But for those who - like the Obama administration - believe that sanctions can be effective, why aren't they doing what needs to be done to impose them? It's one thing to say that the Swiss government is dealing with Iran and that their foreign minister hates Israel - we all know that already. But given the choice between having Iran or the United States as a customer, does anyone really believe that Vitol would choose Iran? On a pure business basis, that choice would be totally irrational. So why isn't the Obama administration doing what needs to be done to give sanctions a chance to work? And why didn't the Bush administation do it before them?

posted by Carl in Jerusalem @ 1:38 PM