New U.S. sanctions target Iran’s oil sales, financial transactions

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President Obama announced new Iran sanctions Tuesday, targeting Iran’s oil sales and financial transactions and warning Tehran that it will face “growing consequences” for refusing to open its nuclear program to outside scrutiny.

The sanctions will focus on Iran’s energy and petrochemical industries and are designed to stop Iran’s attempts to circumvent existing sanctions by setting up payment mechanisms with outside financial institutions — including with banks in China and Iraq.

The new action specifically targets the Bank of Kunlun in China and Elaf Islamic Bank in Iraq. Both banks have been accused of ignoring international sanctions and facilitating transactions worth millions of dollars for Iranian banks.

Mr. Obama said the U.S. is still seeking a diplomatic solution to the nuclear dispute, “but the onus is on Iran to abide by its international obligations.”

“By cutting off these financial institutions from the United States today’s action makes it clear that we will expose any financial institution, no matter where they are located, that allows the increasingly desperate Iranian regime to retain access to the international financial system,” the White House said in a statement.

The announcement comes just days after presumptive Republican nominee Mitt Romney visited Israel and pledged to prevent Iran from moving forward with its nuclear program.

The U.S. and its allies accuse Iran of attempting to build a nuclear weapon while Tehran has said its program is for peaceful civilian energy uses.

In recent months, Israel has threatened to launch a pre-emptive military strike against Iran in an effort to knock out its nuclear facilities, and on Sunday Israeli Prime Minister Benjamin Netanyahu said sanctions and diplomatic pressure have not had the intended purpose of curbing Iran’s nuclear program “by one iota.”

Mr. Romney’s campaign on Tuesday echoed Mr. Netanyahu’s comments and blasted Mr. Obama’s record on Iran, arguing that the series of sanctions has done nothing to stop Iran’s nuclear program.

“Since taking office three and a half years ago, President Obama has allowed Iran’s nuclear ambitions to proceed unimpeded,” said Romney campaign spokesman Ryan Williams. “As Israel’s prime minister recently made clear, the Obama administration’s efforts haven’t made an ‘iota’ of difference. The president’s refusal to take a tough stance when it comes to Iran has imperiled our allies and jeopardized our national security.”

The White House on Tuesday defended the strength of its sanctions on Iran, arguing that they have seriously weakened Iran’s economy, hurt Tehran’s ability to procure technology, and changed the calculus for Iranian leaders in whether to press forward with the nuclear program.

“If the Iranian government continues its defiance, there should be no doubt that the United States and our partners will continue to impose increasing consequences,” Mr. Obama said in a statement.

House and Senate negotiators this week pressed ahead on a new package of Iran sanctions that builds on current penalties and targets anyone who mines uranium for Iran; sells, leases or provides oil tankers to Tehran; or provides insurance to the National Iranian Tanker Co., the state-run shipping line.

Democratic and Republican leaders in the Senate said they hoped to have the bill to the president’s desk by the end of the week.

Iranian President Mamoud Ahmadinejad labeled the new economic pressure “warfare” and said he would retool the country’s oil-dependent economy to compensate.

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