EU ministers likely to adopt tighter sanction beyond those passed by UN on June 10, which called for inspection of suspicious Iran cargo on ships and aircraft.

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July 20, 2010

The Iranian parliament on Tuesday adopted a bill authorizing tit-for-tat retaliation against countries that inspect ships and aircraft belonging to the Islamic Republic as part of the latest set of United Nations sanctions over the country’s contentious nuclear program.

The UN Security Council last month passed a resolution to impose a fourth set of sanctions against Iran, enabling international inspection of suspicious Iranian cargo ferried by ships or aircraft.

The sanctions came after Iran refused to halt its uranium enrichment activities. Iran insists on its right to pursue peaceful nuclear development as a signatory of the nuclear Non-Proliferation Treaty and member of the International Atomic Energy Agency and rejects Western charges that it has been working on a secret weapons program.

European Union foreign ministers will adopt tighter sanctions against Iran next week, including measures to block oil and gas investment and curtail its refining and natural gas capability, EU diplomats said.

A draft declaration prepared for a meeting of EU foreign ministers showed they would approve a decision taken by EU leaders on June 17 to adopt further sanctions over Tehran’s nuclear program, and also call on Iran to resume talks.

The measures, which go beyond steps approved by the United Nations on June 10, are designed to put pressure on Tehran to return to talks on its uranium enrichment program which Western powers believe is designed to produce nuclear weapons.

The draft declaration says the ministers, who meet in Brussels on Monday, will approve the new sanctions “in accordance with the European Council Declaration of 17 June”, referring to the decision taken by EU leaders at a summit.

It said the measures were adopted “with a view to supporting the resolution of all outstanding concerns regarding Iran’s development of sensitive technologies in support of its nuclear and missile program, through negotiation”.

The declaration is still to be endorsed by EU ambassadors, meeting in Brussels this week, but big changes are unlikely.

The new EU steps focus on trade, banking and insurance, transport including shipping and air cargo, and important sectors of the gas and oil industry.

EU leaders said on June 17 the energy sector sanctions would prohibit “new investment, technical assistance and transfers of technologies, equipment and services related to these areas, in particular related to refining, liquefaction and liquefied natural gas technology”.

Iran denies its nuclear program is aimed at producing weapons and says it is for energy and other peaceful purposes.

The measures are intended to put strong financial pressure on Iran, which is the world’s fifth largest crude oil exporter but has little refining capability.

But diplomats have also acknowledged that the impact of the sanctions will depend on steps to ensure compliance.

Traders said this month Iran was depending more on friendly powers for fuel supplies because of the sanctions intended to hinder its fuel imports, and was buying about half of its July gasoline imports from Turkey and the rest from Chinese sellers as most other suppliers had stopped selling.

The foreign ministers will also back appeals by EU foreign affairs chief Catherine Ashton for Iran to restart talks in response to a July 6 letter from Iran’s chief nuclear negotiator, Saeed Jalili, that proposed resuming dialogue.

“The Council (of foreign ministers) calls on Iran to seize this opportunity to allay the concerns of the international community about its nuclear program and agree on a concrete date for talks with the EU High Representative, together with the six countries,” the draft declaration said. It was referring to the six powers — the United States, Russia, China, Britain, France and Germany — that are involved in discussions on Iran’s nuclear program.

Jalili’s proposal was the first indication that Tehran is willing to engage with world powers on its atomic program since the United Nations imposed its new sanctions last month.

The U.S. Congress has also drawn up its own set of measures against Iran in addition to the UN sanctions package, parts of which were watered down by Russian and Chinese opposition.

On Sunday, Iran’s parliament approved a bill urging the government to continue pursuing 20-per-cent uranium enrichment in the Natanz nuclear plant. The resolution calls for resisting what the parliament called plots by the United States and Britain against Iran’s rights to pursue peaceful nuclear technology.

The measure was regarded as a symbolic political gesture, because nuclear decisions are made by Supreme Leader Ayatollah Ali Khamenei through the National Security Council, not the parliament.

Iran began the enrichment process in February, without any input from the legislature.

A deal to exchange low-enriched uranium for nuclear fuel from Russia and France failed, and Iran started enriching its own fuel at the Natanz plant in the central part of the country.

Tehran claimed to have already produced 20 kilograms of uranium enriched to the 20-per-cent level.

The government also claimed it would be able to produce fuel rods for the Tehran medical reactor by March 2011, and then begin construction of a new reactor to replace it.

President Mahmoud Ahmadinejad has noted that Iran only began the process because the fuel swap was not realized, and said he would prefer fuel from foreign sources because enrichment is costly.

Ahmadinejad also said Tehran would be ready to resume nuclear talks with the world powers in late August, after the Muslim fasting month of Ramadan.