U.S. nears sanctions for Iranian nukes

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Efforts by the Obama administration to reach out to Iran have not produced a deal to halt Tehran’s apparent pursuit of nuclear weapons, Secretary of State Hillary Rodham Clinton said Monday, and the U.S. now appears closer to moving forward with potentially crippling new sanctions.

“I don’t think anyone can doubt that our outreach has produced very little in terms of any kind of a positive response from the Iranians,” Mrs. Clinton told reporters before a speech on human rights that also criticized Iran. “Certainly, additional pressure is going to be called for.”

Mrs. Clinton was the latest senior U.S. official to signal that more sanctions could be imposed early next year. President Obama has set a year-end deadline to see whether his strategy of diplomatic outreach can persuade the Iranians to curb a program that could give them the capability to produce nuclear weapons.

Defense Secretary Robert M. Gates predicted Friday that “significant additional sanctions” were looming, while the White House issued a stern statement the same day saying “there will be consequences” to Iranian inaction.

Mr. Obama added pointed language to his Nobel Peace Prize acceptance speech in Oslo, signaling that he expects the rest of the world to join the U.S.

Richard Fontaine, a senior fellow at the Center for a New American Security, said: “My sense is that it’s going to come to a head. If we get to the end of the year and nothing unexpected happens on the Iranian side, the administration is left with very few options.”

U.S. officials have stressed that the door remains open, but infighting in Tehran and the regime’s preoccupation with containing domestic opposition after a disputed presidential election appears to have reduced the chances for a deal.

Iranian Foreign Minister Manouchehr Mottaki said over the weekend that Iran would be willing to trade some of its partially processed uranium for fuel for a reactor that produces medical isotopes. The offer did not satisfy Western concerns about Iran’s potential to make nuclear weapons. Iran, which denies it wants to make nuclear weapons, has declined to return to multilateral talks about its program.

The tougher language out of the White House is being matched with preparations on Capitol Hill and internationally to further restrict Iran’s commercial trade, banks and shipping.

The United States has barred most U.S. trade with and investment in Iran since the Clinton administration. Under the George W. Bush administration, it targeted Iranian banks. The House is expected to vote Tuesday on legislation granting the president authority to punish foreign individuals and companies that sell or ship gasoline to Iran.

The administration also has been discussing with envoys from France and Britain a fourth resolution tightening existing U.N. sanctions on Iran. Such a measure will require at a minimum the acquiescence of China and Russia, which have veto power on the U.N. Security Council and have been reluctant to jeopardize their commercial ties with Iran.

Kenneth Katzman, a specialist on Iran at the Congressional Research Service, said the United Nations “may go in the same direction” as the U.S., with “travel bans and asset freezes on some of the same people” already sanctioned by the U.S. Treasury Department. He said the main emphasis probably would be on making it more difficult for Iran’s shipping companies to obtain insurance for their cargo.

Matthew Levitt, a former Treasury official now at the Washington Institute for Near East Policy, said the Obama administration also might use a little-known 2007 executive order that targets kleptocrats to go after Revolutionary Guards and other Iranian officials involved in corrupt front companies.

This would have the benefit of helping the Iranian opposition, he said. It’s “a way to play on the further delegitimization of the regime.”

In concert with the U.N. effort, the Obama administration is working closely with the European Union ahead of a vote at the end of January on EU trade with Iran. Despite statements from European governments, Iran still enjoys robust commerce, in particular, with Germany, which had a net increase in trade with Iran between 2008 and 2009.

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