Israel Matzav

This should have been done a long time ago

The Los Angeles Times reports on Friday that Iran's failed plot to assassinate the Saudi ambassador to the United States, and to blow up with Saudi and Israeli embassies in Washington (although for some reason they mention Argentina rather than Israel), has convinced the Obama administration to consider sanctioning Iran's Central Bank. For once, it sounds like these sanctions could actually do something.

David Cohen, the Treasury undersecretary for terrorism and financial intelligence, told the Senate Banking Committee that officials were "looking very actively" at such a step and might carry it out if other nations could be persuaded to follow suit.

The blacklisting is the first specific step the administration has identified as a possible response to the alleged plot to assassinate Saudi Arabia's envoy to the United States and to attack embassies in the U.S. and Argentina.

Such sanctions would aim to isolate the Bank Markazi, or central bank, from the world economic system by barring any firm that deals with it from doing business with U.S. financial institutions. That would make it far more difficult for Iran to sell crude oil, which funds much of the government's activities.

Some Iranian officials have warned that they would look on such a move as an act of war.

...

Sen. Mark Kirk (R-Ill.) said the administration's sanctions so far hadn't been enough to dissuade Iran from continuing its nuclear program or sponsoring terrorism. He called on the White House to "move quickly to implement the most effective nonmilitary response: cutting off the central bank of Iran and collapsing the Iranian currency." The move would "economically cripple" Iran, his office said in a statement.

Mark Dubowitz, a specialist on sanctions at the Foundation for Defense of Democracies, said a so-called designation of the bank would not halt all of Iran's crude oil sales, but it would sharply raise the cost of such transactions and thus "drain the Iranian treasury." He said Iran, the third-largest OPEC oil exporter, is a "one-crop country" that derives 50% to 75% of its government revenue from crude oil.

Congress last year slapped sanctions on Iranian banks involved in the energy sector to bar them from contact with the U.S. financial system. But U.S. officials say these banks have continued to conduct oil business because the central bank has secretly carried out the transactions on their behalf.

In his testimony, Cohen said U.S. officials were also considering another proposal many lawmakers favor: halting all sales of oil products made from Iranian crude to the U.S. market. Americans use gasoline that is refined from Iranian crude by international oil companies, which then distribute it in the United States. Cohen said Treasury economists were studying that proposal to evaluate its effect on oil markets.

Both these steps are long overdue. I find it incredible that Americans are buying gasoline that's being made from Iranian crude oil.

Labels: Iranian assassination plots, Iranian central bank, Israeli embassy, Saudi embassy

posted by Carl in Jerusalem @ 12:48 AM