Iran’s Oil Minister Threatens to Halt Oil Exports if Sanctions Continue
The continued standoff between Iran and the world over Iran’s nuclear program escalated—at least verbally—with Iran’s oil minister, Masoud Mirkazemi, threatening to cut off Iran’s oil exports if economic sanctions continue. He was referring to the various economic and trade sanctions, such as restrictions on technology transfer and on certain financial institutions, that have been in place in one form or another since 2006 in response to Iran’s refusal to discontinue its nuclear development. As reported by Bernama.com on Wednesday, Mirkazemi said, “Iran is one of the world’s major oil producers and any cut in Iran’s supply of crude will, undoubtedly, cause [oil] prices to surge.”
Iran insists that its nuclear program is peaceful, and that the nation with the world’s third-greatest proven oil reserves needs nuclear power for electrical generation. Most other nations are skeptical, and see Iran’s efforts as nuclear proliferation. Sanctions have been imposed to encourage Iran to forego nuclear development in exchange for the removal of the sanctions. In that, they have been spectacularly unsuccessful, as have been similar (though more extreme) sanctions aimed at North Korea. Recently, several major Western governments (U.S., Britain, France, and Germany) have been pushing to extend and strengthen sanctions in the face of continued Iranian intransigence.
Of course, just as the world has foregone putting sanctions directly on Iran’s oil sector, unwilling to deprive itself of Iranian oil, Iran is unlikely to take action that would seriously reduce or limit the $80 billion it derives annually from exporting petroleum—almost 25 percent of its GDP.
That may be why the oil minister’s threat did not spike oil prices—while Iran’s arrest of a handful of British yachters did. Talk is cheap, as the saying goes, so in light of Iran’s own obvious interest in continued oil exports, the minister’s threat is discounted. But seizing a Western power’s citizens is a concrete act that can ratchet up tensions in a volatile and critical part of the world.