Israel Matzav

Iran sanctions likely to target insurance

With talks scheduled to open on Thursday between Iran and the P-5 + 1 powers, the Washington Post reports that sanctions against Iran are likely to target its ability to insure and reinsure export and import shipments, but not its purchases of refined oil products.

As a practical matter, the effort would build on efforts during the Bush administration that targeted leading Iranian banks and the key Iranian shipping line. In many cases, officials said that rather than impose new sanctions, they would need only to tighten enforcement of existing rules and regulations. Indeed, the key architect of President George W. Bush's effort, Treasury Undersecretary Stuart Levey, was retained by President Obama to ensure continuity in a possible squeeze on Iran.

In the case of the insurance industry, the administration would extend a prohibition against providing the "transfer of financial resources or services" to aid Iran's nuclear and missile programs, currently enshrined in U.N. Security Council Resolution 1737, to include insurance companies, export credits and the like.

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The administration has sought to display a united front with its partners in the talks -- Britain, France, Germany, Russia and China. But Russia and China are especially wary of imposing more sanctions beyond those contained in three U.N. Security Council resolutions aiming at deterring Iran. Russian officials on Monday began backing off from statements made last week by President Dmitry Medvedev suggesting that Russian resistance to sanctions was weakening.

Foreign Minister Sergei Lavrov told Russian news agencies that the missile launches were "worrisome" but added, "I am convinced restraint is needed." Similarly, a Foreign Ministry source told Russian news agencies that Western powers needed to restrain themselves.

Both Russia and China have veto power on the U.N. Security Council, and reluctance by either to support additional sanctions would make it extremely difficult and time-consuming to erect additional international measures. But many European and Asian countries demand the cover of a U.N. resolution before taking economic action against another country. As a result, administration officials are focused on measures that they can argue are already authorized under existing resolutions.

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Last year, as an example of the emerging strategy, the Treasury Department designated Iran's national maritime carrier, Islamic Republic of Iran Shipping Lines (IRISL), as engaging in deceptive activities such as repeatedly changing its ships' names in an effort to shroud its involvement in illicit commerce and proliferation activities. The action essentially warned U.S. financial firms not to engage in any business with it or its subsidiaries. Officials expect the European Union to follow suit if talks with Iran fail to make progress this year, which would make it difficult for such companies as Lloyds or Munich Re to continue providing re-insurance for Iranian business.

Early this year, an IRISL-chartered ship, the Monchegorsk, was stopped at Cyprus carrying weaponry allegedly headed for Hezbollah -- an incident that U.S. officials said highlights the dangers of reputable financial firms dealing with Iranian entities.

Even so, the effort is not likely to produce instantaneous results.

Read the whole thing.

Here's a video that discusses possible new sanctions against Iran.

Let's go to the videotape.



Unfortunately, I don't hold out much hope for sanctions because I don't believe there's enough time for them to have a real effect, even if Russia and China agree to play along. The time for 'serious' sanctions was 2-3 years ago when they still had time to be effective. Now, it's just a question of time until either someone (Israel or the US) attacks Iran's nuclear weapons capability or - God forbid - we face a nuclear Iran. And the longer we give sanctions to work, the more likely we will face a nuclear Iran.

posted by Carl in Jerusalem @ 7:28 AM