- Associated Press - Thursday, September 27, 2012

JERUSALEM (AP) — A new Israeli government report, leaked to local media Thursday, concludes that international sanctions are hitting Iran hard — undercutting Prime Minister Benjamin Netanyahu’s key claim as he heads to the United Nations to argue for tougher action against the Jewish state’s arch foe.

The report surfaced after Israel‘s foreign minister predicted that Iran‘s leaders would face an Arab Spring-style popular revolt within the next year — an argument that further counters Mr. Netanyahu’s charge that an attack on Iran‘s nuclear facilities may be the only answer to what he calls a fanatic and intransigent Iranian leadership.

Iran says its nuclear program is for peaceful purposes, but Israel, the United States and other Western countries reject that assertion. The United Nations already has slapped four rounds of economic sanctions on the Islamic Republic, but Mr. Netanyahu repeatedly has cast doubt on the effectiveness of those measures, arguing that they have crippled Iran‘s economy but have not persuaded Tehran to halt its nuclear program.

Mr. Netanyahu instead has placed emphasis on urging the U.S. to draw “red lines” that would make clear which conditions would provoke an American strike on Iran‘s nuclear facilities — a demand that Washington has rejected.

When Mr. Netanyahu addresses the U.N. General Assembly on Thursday, he is expected to reiterate his contention that the sanctions are not working — a claim that could be deflected by the findings in the new report, which came from the Israeli Foreign Ministry.

According to the report, details of which appeared in the Haaretz newspaper, Iran‘s oil exports declined by more than 50 percent in the past year — from 2.4 million barrels a day to 1 million — and oil revenues have dropped by $40 billion since the beginning of the year.

An Israeli official confirmed the report but refused to elaborate on it. The official spoke on condition of anonymity because he was not authorized to discuss internal government documents.

The report also claims that sanctions on Iran‘s central bank have made it difficult for the regime to access its foreign currency reserves, causing a 100 percent gap between the country’s official exchange rate and the price at which the rial is trading on the black market. Bread, meat and electricity prices have also soared because of the sanctions, the report finds.

Israel‘s Foreign Ministry, Haaretz reports, based its findings on data it received from countries that have embassies in Iran.