Transcript: Special Representative for Iran Brian Hook Briefs Reporters on Iran Sanctions

This transcript was published by the Office of the Spokesperson at the U.S. Department of State. The briefing took place on November 2, 2018.

MR HOOK:  I’m happy to take questions.  And you’ve heard the Secretary talk.  I just (inaudible).

QUESTION:  What are the eight countries?

MR HOOK:  Huh?

QUESTION:  What are the eight countries? 

QUESTION:  What are the eight countries? 

MR HOOK:  Monday.  Monday.

QUESTION:  Can you at least say what are the two that said that they will cut to zero since it seems the negotiations with them are over?

MR HOOK:  It’ll – it’s all going to be announced on Monday.

QUESTION:  But why do all of this today if there’s so little detail available today?

MR HOOK:  There was a lot of detail today.  There was a full briefing by both secretaries.  So --

QUESTION:  There was not a lot of detail.

MR HOOK:  The sanctions go back into effect on Monday.  This was a preview today.

QUESTION:  Can I ask, though, similar to the question Arshad asked on the – using the word jurisdiction instead of country, can we assume that a certain island that begins with “T” is the reason that you’re using jurisdiction instead of country?  Or is that --  

MR HOOK:  I think --  

QUESTION:  Taiwan.  I’ll --

QUESTION:  Could jurisdiction mean more than one government, or does it mean one government?

MR HOOK:  Is this what Secretary Mnuchin said?

QUESTION:  He said – no, Pompeo.

QUESTION:  Both, both.  Pompeo – both of them said --

QUESTION:  They used the word jurisdictions.

QUESTION:  -- jurisdiction not country, which is why – I mean, it’s a technical point, but I’m just – and I get – I can understand that you don’t want to give the names.

MR HOOK:  I don’t know all of them.  I don’t know.  

QUESTION:  But are all of the eight countries?

QUESTION:  Single governments?

QUESTION:  Countries?

MR HOOK:  Yes.

QUESTION:  Yes countries or yes governments?

MR HOOK:  They are – they are -- 

QUESTION:  If Taiwan is among them, that would be a reason to -- 

MR HOOK:  I get it.  They’re nations.  They’re nations.

QUESTION:  Okay.  So Taiwan is not.

MR HOOK:  I’m not going to say what it’s not.  I’m saying that eight nations.

QUESTION:  Can I get a clarification on the SREs?

MR HOOK:  Yeah.

QUESTION:  Yesterday you said the waiver is granted for a six-month period and then re-evaluated. 

MR HOOK:  That’s by statute.

QUESTION:  Right.  And then the Secretary said it will take them weeks longer to wind down.  Is that all-encompassing for the eight that are being granted or just --  

MR HOOK:   No, he was – there he was talking about two of the countries that will receive an SRE are going to be given a little extra time, weeks of time, to get to zero.

QUESTION:  But they – if they can still – the waiver is for six months still by statute?

MR HOOK:  But operationally it’s only relevant for the first few weeks of the – but by law, when we give an SRE, it’s for 180 days.

QUESTION:  Right.

MR HOOK:  And that’s under the National Defense Authorization Act of 2012, NDAA.  And so it’s a 180-day SRE.  It doesn’t matter whether they go to – I mean, it’s – each country is different.  In two of the countries, they will be getting to zero before the expiration of the SRE.

QUESTION:  Can you talk about kind of the broader efforts on trying to get Iran to behave like a normal regime?  I mean, does that include kind of the Twitter messaging or social media messaging, or is it something more than that, more concrete about supporting opposition groups or protestors?

QUESTION:  Is it more than just Twitter messages?  Is there something – is the U.S. doing something to kind of promote protestors?

MR HOOK:  The Iranian regime has historically not come to the negotiating table absent significant economic and diplomatic pressure.  The reimposition of our sanctions are designed to do two things:  deny the regime the revenue it needs to fund violent wars abroad, and also to change the cost-benefit analysis in our favor so that Iran decides to come back to the negotiating table. 

The Ayatollah Khamenei has said that require hostility with the United States, which is the kind of thing that you expect to hear from a revolutionary regime.  We have been very clear.  Secretary Pompeo has been very clear that we have an ear open to what is possible.  We very much want to begin work on a new and better deal to replace the insufficient Iran nuclear deal that the President left in May, and our campaign of maximum economic pressure is a critical tactic to achieve that goal.

QUESTION:  But he’s also talking about restoring democracy. 

MR HOOK:  The President, the Secretary of State, the Vice President, at all levels of the administration, have stood with the Iranian people and their aspirations for a better way of life.  The Iranian people want a more representative government, a government that does not rob them blind, that supports their human rights, their economic rights, their freedom of expression, freedom of assembly.  These are all rights that the United States wants for the Iranian people.  We think they deserve a much better way of life, and Secretary Pompeo has repeatedly made remarks addressed to the Iranian people in support of their demands for reforms from this regime.

QUESTION:  How – I want to ask the question that Gardiner asked yesterday about the Khashoggi murder and the war in Yemen and how any of that is playing into this.  I mean, how can you, on the one hand, focus so much on Iran’s human rights record while not doing enough to pressure the Saudis on some of the same very issues?

MR HOOK:  We do not share interests or values with the Iranian regime.  We have asked Saudi Arabia to increase the production of oil while we take off Iranian oil from the market, and Saudi Arabia has been very helpful to ensure an adequately supplied oil market during this period where we have seen dramatic reductions in the import of Iranian crude as part of our maximum economic pressure campaign.  The Saudi Government has successfully insulated oil from broader political issues, and that has been helpful in the broader context of our pressure campaign.

QUESTION:  Well, just to be devil’s advocate here, I understand the shared interests that you have with the Saudis on Iran.  But what shared interests, what shared values does the U.S. have with the Saudis – respect for human rights?

MR HOOK:  I can only speak to how the Saudis have helped our Iran strategy.  The President gave a speech in Riyadh on his first trip overseas as president, where he called upon our Sunni Arab partners to increase their capabilities to reverse Iranian hegemony so that our Arab partners can shoulder more of the burden in the Middle East.  And we have enjoyed a great deal of cooperation from Gulf countries and beyond to isolate Iran and to apply as much economic pressure as possible so that they don’t have the money they need to destabilize the Middle East.

QUESTION:  How is this escrow account that he talked about going to work, and how do you make sure that the Iranians are going to get basic needs fulfilled – medicine, food?

MR HOOK:  The escrow accounts that are being created for those nations that need to continue importing Iranian oil deny Iran hard currency, and it denies Iran any revenue from oil sales.  Any time Iran sells oil, that money goes into an escrow account in the importing nation’s bank, and Iran has to spend down that credit.  We strongly encourage those nations to ensure that Iran spends that money on humanitarian purchases to benefit the Iranian people.  The longest-suffering victims of the Iranian regime are the Iranian people.  This regime uses fake companies disguised as humanitarian organizations to divert purchases that should go to food, medicine, and medical devices, and they use that to enrich the regime and support revolutionary activities overseas.

QUESTION:  So you’re counting on countries like China to make sure that they don’t use money for those things?

MR HOOK:  The United States will be monitoring these escrow accounts very closely.  Unlike in prior administrations, we will ensure that the money is not spent on illicit activities, that there isn’t any leakage in these escrow accounts, and we will work closely with countries to encourage the purchase and – the sale and purchase of humanitarian goods to benefit the Iranian people.  Our sanctions regime has very clear exceptions for the sale of food, medicine, and medical devices.

QUESTION:  So how does the travel ban fit into the U.S. support for Iranian people?

MR HOOK:  Because the Iranian regime is the largest sponsor of terrorism in the world, we have a restrictive visa policy.  And that policy is driven by the terrorism of the regime.  It is not driven by a desire to restrict the average Iranian people.  The problem we have is --

QUESTION:  But it does.

MR HOOK:  But that is the problem of the regime.  If the regime would stop funding terrorism and open up its economy so that we can see where the money goes, it would create a much better environment for us to be granting visas.

QUESTION:  So for the countries that you say need to keep importing oil, do you foresee issuing these exemptions over and over again?  Are you going to put an upper limit on how many times they’ll be renewed?

MR HOOK:  Our goal remains getting countries to zero imports of Iranian oil.  In 2019, our projections are that oil supply will exceed demand, and that creates a much better atmosphere for us to bring remaining nations to zero as quickly as possible.

QUESTION:  So you’re not putting an upper limit on how – for how – how many times these exemptions will be renewed at this point?

MR HOOK:  We are not looking to grant additional SREs at the end of the 180-day period.  We are being very careful to advance our maximum economic pressure campaign without increasing the price of oil.  Next year we anticipate a stronger oil supply coming online, and that will allow us to accelerate the path to zero.

QUESTION:  And are you – how many Iranian banks will be cut off from SWIFT?  I mean, the administration is saying more than prior, but can you give a number?

MR HOOK:  That will be announced by Secretary Mnuchin on Monday.

QUESTION:  He did say, though, on this subject – he was very precise in his language.  He said “certain designated Iranian financial institutions.”  That does not categorically mean all.  So is it possible that either, one, don’t redesignate all of the banks that had previously been designated; and two, is it possible that some designated bank, because he used the word “certain designated,” would not be required to disconnect?

MR HOOK:  I’m not going to interpret what “certain” means beyond saying that he will announce all the banks on Monday.

QUESTION:  The 20 – 20 countries import 80 percent of Iran’s oil, as I understood – stand.  Are those eight countries, any of them, among those 20 – the eight countries receiving the SREs?

MR HOOK:  That there’s a small group of – that there’s a – there is a relatively small number of countries that make up the lion’s share of the import of Iranian crude.

QUESTION:  And are any of them getting exemptions?

MR HOOK:  I’m not going to get ahead of the Secretary’s announcement on Monday.

QUESTION:  Can you offer a little clarity on the response about non-U.S. civil nuclear cooperation?  Will waivers be granted in that --

MR HOOK:  The Secretary addressed that this morning, and it’ll be announced on Monday.

QUESTION:  On the humanitarian transaction, Europeans have expressed concern in the past weeks that even though there were exemptions to humanitarian goods and services, the financials mechanism were not safe enough, that you have to clarify what are the means by which the countries and entities can do those kind of transactions.  Do you think that what you announced today clarifies this and that it’s safe to do humanitarian transactions with Iran?

MR HOOK:  The Iranian regime has a history of creating front companies to divert the distribution of humanitarian goods.  Financial institutions around the world know of Iran’s history of deceiving banks on the sale of humanitarian goods.  The burden is on Iran to open up its dark economy so that banks around the world have more confidence that when they facilitate humanitarian transactions that the humanitarian goods will reach the Iranian people. 

The United States is the largest donor of humanitarian assistance in the world.  Every sanctions regime we have makes exceptions for food, medicine, and medical devices.  That is, we have done our part; the Iranian regime needs to do its part by making those transactions possible in an open and transparent financial system.

QUESTION:  Sounds like there’s not very many safe ways of trade – like, for pharmaceutical companies and medical companies.

MR HOOK:  The Iranian regime makes it very difficult to facilitate the sale of humanitarian goods and services.

QUESTION:  The Europeans says that the fear is that even if you sell humanitarian goods to Iran, you will be target by U.S. sanctions, so they addressing this to you and not to Iran.

MR HOOK:  Say that again?

QUESTION:  The European countries say that companies fear that if they sell those goods to Iran, they will be targeted by U.S. sanctions.  So they ask you to say what are the safe channels to do that.

MR HOOK:  The burden is not on the United States to identify the safe channels.  The burden is on the Iranian regime to create a financial system that complies with international banking standards to facilitate the sale and provision of humanitarian goods and assistance.

QUESTION:  Right, but I think that the point is that they are looking for some kind of, like, assurance --

QUESTION:  Guidance from OFAC.

QUESTION:  Guidance.

MR HOOK:  We have been – OFAC has given very clear guidance over many years --

QUESTION:  That’s not what the Europeans say.

MR HOOK:  We have done our part to permit the sale of humanitarian goods to Iran.  That is our part.  That is our role.  Iran has a role to make these transactions possible.  Banks do not have confidence in Iran’s banking system – often don’t have confidence in Iran’s banking system to facilitate those transactions.  That’s Iran’s problem; it is not our problem.

QUESTION:  But banks do not have confidence, the companies do not have confidence in Iran banks because they are subject to American sanctions from now on.

MR HOOK:  That’s not true.

QUESTION:  That’s what the Europeans say.  I’m just --

MR HOOK:  I’m giving you the answer. 

QUESTION:  We were expecting the list.  (Laughter.)

MR HOOK:  But he told you it was coming Monday.

QUESTION:  Why is it that – and when you say Monday, this isn’t going to be at literally 12:01 Monday morning, is it?  Or I mean --

MR HOOK:  No.  The Secretary will announce it on Monday, and then it will be published in the Federal Register.

QUESTION:  Okay, but he’ll announce it – what, do you have any – like, I just want it for personal planning purposes.

MODERATOR:  About 8:30 in the morning.

QUESTION:  8:30 Monday morning and not beforehand.  So in other words, I – at 12:01 Monday morning, they go into effect --

MR HOOK:  Yes.

QUESTION:  -- but there won’t be a – like, is something going to go up on the Treasury website at 12:01?  I mean, I’m just trying to figure out --

MR HOOK:  I don’t know about that.  For our part, on the SREs and anything else will be announced on Monday.  I don’t – Treasury may have a different way where at 12:01 they have to --

QUESTION:  So you guys aren’t planning on saying who the eight are at 12:01.

MR HOOK:  No.  No.  No.

QUESTION:  But presumably these eight are aware that – right, they’ve been told that they’re okay to – because they’re all coming out of the woodwork now, the Turks, the Italians, the South Koreans, the Indians, the – they are.

MR HOOK:  I think you’ve answered your own question.

QUESTION:  Well, I just want to make sure no one’s lying.

MR HOOK:  Oh.  We’ll announce it on Monday.

QUESTION:  And so will we see sanctions on the countries that aren’t getting these things on Monday?

MR HOOK:  We expect – well, we have already seen enormous pre-compliance with the reimposition of our sanctions because corporations around the world are rightly choosing to sell goods and services in the United States over the Iranian market if given the choice.

QUESTION:  But I mean, weren’t we going to see sanctions on big countries that aren’t – that don’t get these waivers?  Are you going to – sanctions announced on Monday?

MR HOOK:  We expect nations around the world to comply with sanctions because it’s in their interest, and it promotes our broader national security objectives to address a significant and expanding threat to peace and security.

Okay.

QUESTION:  Thank you.

MR HOOK:  All right, thank you.

Photo Credit: State Department

Transcript: Pompeo and Mnuchin Brief Reporters on Forthcoming Iran Sanctions

This transcript was published by the Office of the Spokesperson at the U.S. Department of State. The briefing took place on November 2, 2018.

MS NAUERT:  Thank you, sir.  Good morning, everyone, and welcome to today’s on-the-record call on the Iran snapback sanctions.  We’re pleased to have with us Secretary of State Mike Pompeo and Secretary of the Treasury Steve Mnuchin.  They will each have brief remarks at the top and then take several of your questions.  We’ll start first with Secretary Pompeo. 

Secretary, please, go ahead.

SECRETARY POMPEO:  Thank you, Heather.  Good morning, everyone, and thank you for joining the call.  Earlier this year, President Trump withdrew from the fatally flawed nuclear deal and implemented a new campaign aimed at fundamentally altering the behavior of the Islamic Republic of Iran.  This part of the campaign about which we’re speaking today is simple.  It is aimed at depriving the regime of the revenues that it uses to spread death and destruction around the world.  Our ultimate aim is to compel Iran to permanently abandon its well-documented outlaw activities and behave as a normal country.

Today, Secretary Mnuchin and I will discuss one of the many lines of effort to achieve these fundamental changes in the Iranian regime’s behavior as directed by the President.  While important, these economic sanctions are just a part of the U.S. Government’s total effort to change the behavior of the Ayatollah Khomeini, Qasem Soleimani, and the Iranian regime.

On November 5th, the United States will reimpose sanctions that were lifted as part of the nuclear deal on Iran’s energy, ship building, shipping, and banking sectors.  These sanctions hit at the core areas of Iran’s economy.  They are necessary to spur changes we seek on the part of the regime. 

In order to maximize the effect of the President’s pressure campaign, we have worked closely with other countries to cut off Iranian oil exports as much as possible.  We expect to issue some temporary allotments to eight jurisdictions, but only because they have demonstrated significant reductions in their crude oil and cooperation on many other fronts and have made important moves towards getting to zero crude oil importation. These negotiations are still ongoing.  Two of the jurisdictions will completely end imports as part of their agreements.  The other six will import at greatly reduced levels.

Let me put this in context for you.  The Obama administration issued SREs to 20 countries multiple times between 2012 and 2015.  We will have issued, if our negotiations are completed, eight and have made it clear that they are temporary.  Not only did we decide to grant many fewer exemptions, but we demanded much more serious concessions from these jurisdictions before agreeing to allow them to temporarily continue to import Iranian crude oil.  These concessions are critical to ensure that we increase our maximum pressure campaign and accelerate towards zero.

Our laser-focused approach is succeeding in keeping prices stable with a benchmark Brent price right about where it was in May of 2018 when we withdrew from the JCPOA.  Not only is this good for American consumers and the world economy, it also ensures that Iran is not able to increase its revenue from oil as its exports plummet.  We will, we expect, have reduced Iranian crude oil exports by more than 1 million barrels even before these sanctions go into effect. 

This massive reduction since May of last year is three to five times more than what many analysts were projecting when President Trump announced our withdrawal from the deal back in May.  We exceeded our expectations for one simple reason: Maximum pressure means maximum pressure.

The State Department closed the Obama era condensate loophole which allowed countries to continue importing condensate from Iran even while sanctions were in place.  This loophole allowed millions of dollars to continue to flow to the regime. 

This administration is treating condensate the same as crude since the regime makes no distinction between the two when it decides to spend its oil revenue on unlawful ballistic missiles, terrorism, cyberattacks, and other destabilizing activities like the assassination plot Denmark disclosed this past week. 

And starting today, Iran will have zero oil revenue to spend on any of these things.  Let me say that again.  Zero.  One hundred percent of the revenue that Iran receives from the sale of crude oil will be held in foreign accounts and can be used by Iran only for humanitarian trade or bilateral trade in nonsanctioned goods and services.  

These new sanctions will accelerate the highly successful effects of our sanctions that have already occurred.  The maximum pressure we imposed has caused the rial to drop dramatically, Rouhani’s cabinet is in disarray, and the Iranian people are raising their voices even louder against a corrupt and hypocritical regime.

On that note, our actions today are targeted at the regime, not the people of Iran, who have suffered grievously under this regime.  It’s why we have and will maintain many humanitarian exemptions to our sanctions including food, agriculture commodities, medicine, and medical devices. 

I will now turn the call over to Secretary Mnuchin.

SECRETARY MNUCHIN:  Thank you very much.  Since the beginning of the Trump administration, the Treasury Department has been committed to putting a stop to Iran’s destabilizing activities across the world.  We’ve engaged a massive economic pressure campaign against Iran, which remains the world’s largest state sponsor of terrorism.  To date, we have issued 19 rounds of sanctions on Iran, designating 168 targets as part of our maximum pressure campaign.  We have gone after the financial networks that the Iranian regime uses to fuel its terrorist proxies and Hizballah and Hamas, to fund the Houthis in Yemen, and to support the brutal Assad regime in Syria.

The 180-day wind-down period ends at 11:59 p.m. Eastern Standard Time on Sunday November 4th.  As of Monday November 5th, the final round of snapback sanctions will be enforced on Iran’s energy, shipping, shipbuilding, and financial sectors.  As part of this action on Monday, the Treasury Department will add more than 700 names to our list of blocked entities.  This includes hundreds of targets previously granted sanctions relief under the JCPOA, as well as more than 300 new designations.  This is substantially more than we ever have previously done.  Sanctions lifted under the terms of Iran’s nuclear deal will be reimposed on individuals, entities, vessels, and aircraft that touch numerous segments of Iran’s economy.  This will include Iran’s energy sector and financial sectors.  We are sending a very clear message with our maximum pressure campaign that the U.S. intends to aggressively enforce our sanctions.  Any financial institution, company, or individual who evades our sanctions risks losing access to the U.S. financial system and the ability to do business with the United States or U.S. companies.  We are intent on ensuring that global funds stop flowing to the coffers of the Iranian regime. 

I want to make a couple of comments on the SWIFT messaging systems since I’ve received lots of questions about this over the last few weeks.  So I’d like to make four points.  Number one, SWIFT is no different than any other entity.  Number two, we have advised SWIFT the Treasury will aggressively use its authorities as necessary to continue intense economic pressure on the Iranian regime, and that SWIFT would be subject to U.S. sanctions if it provides financial messaging services to certain designated Iranian financial institutions.  Number three, we have advised SWIFT that is must disconnect any Iranian financial institution that we designate as soon as technologically feasible to avoid sanctions exposure.  Number four, just as was done before, humanitarian transactions to nondesignated entities will be allowed to use the SWIFT messaging system as they have done before, but banks must be very careful that these are not disguised transactions or they could be subject to certain sanctions.  Thank you very much.

MS NAUERT:  Thank you, sirs.  Why don’t we go ahead, take our first question.  We’ll go to Matt Lee with the Associated Press.  Matt, go ahead.

QUESTION:  Thank you, Heather.  Both – either or both of you, on SWIFT, there are a lot of complaints among the President’s allies in Congress that this does not go far enough, and that without designating – without going after SWIFT harder for these messaging transactions, that it allows a serious loophole.  I understand Secretary Mnuchin’s four points on it, but how will you address this criticism?  Because it’s already coming even before this announcement today.

SECRETARY MNUCHIN:  Okay, well let me – Secretary Mnuchin – let me make some comments.  First of all, I think there’s been a lot of fueled misinformation as it relates to SWIFT and what we’re doing with SWIFT.  So that’s why I want to be very clear.  So one, okay, I think there was information that SWIFT would not be subject to sanctions.  That’s not the case.  SWIFT will be subject to sanctions.  Number two, as I said, that – could be subject to sanctions, excuse me.  Number two, it is our intent that they cut off designated entities as was done before.  And again, I think there’s misinformation that they cut off everybody last time.  Again, they did allow for certain entities to do humanitarian transactions consistent with what’s allowed under our sanctions.  There are exceptions for humanitarian sanctions, but I want to very clear, people need to be careful that those are real humanitarian – those are real humanitarian transactions.  So again, I would just say I – hopefully this will clarify the misinformation that’s out there.

MS NAUERT:  Next question, we’ll go to Nick Wadhams from Bloomberg.

QUESTION:  Hi.  I had a question about the oil sanctions going into effect.  Will those include – or will there be exceptions granted for nonhumanitarian transactions such as consumer goods, as were allowed last time, or will Iran only be allowed – or will Iran only be allowed to spend revenue that it gains through – on humanitarian items?  And then second, if you’re giving eight waivers and two jurisdictions are already cutting imports to zero, what’s the point of giving them – those two jurisdictions waivers?  Thanks.

SECRETARY POMPEO:  Nick, this is Mike Pompeo.  With respect to your first point, you’ll see the details on Monday.  There are nonhumanitarian goods that we included in there, but they’re small.  They’re ones that you would’ve already seen in the exemptions that were granted under the direction of the President.  Second, some of these will take a few months to get to zero.  So by November 5th they won’t be there.  That’s the purpose of those exemptions, to give them a little bit longer to wind down.  Weeks.

MS NAUERT:  Pardon me?

SECRETARY POMPEO:  Weeks longer to wind down.

MS NAUERT:  Next question, Mike Warren from the Weekly Standard.

QUESTION:  Hi, gentlemen, thank you.  I want to follow-up on Matt’s questions about SWIFT.  Secretary Mnuchin, you said that certain financial institutions in Iran will be cut off from SWIFT.  Could you explain exactly which financial institutions, or maybe the financial institutions described in a Treasury FAQ, the Central Bank of Iran and other Iranian financial institutions described in section 104(c)(2) blah blah blah – could you be more specific about which institutions?  And how can – how can the United States Government be confident in SWIFT’s ability to monitor transactions using SWIFT that they – I imagine there are numerous of these transactions going on daily.  How can the United States Government be confident that those are not transactions that are funding the bad actions that the government says is – they are trying to stop?

SECRETARY MNUCHIN:  So again, let me comment on the first issue, which – that the list of banks, which will be substantially longer than last time, will be coming out over the weekend.  And as it relates to monitoring transactions, again, financial institutions have liability for any transactions that go through SWIFT or any other mechanisms.  I’m being told the list will come out on Monday.  And again, it’s our expectation that that will be implemented as soon as technologically feasible.

MS NAUERT:  Okay, thank you.  Next question goes to Elise Labott from CNN.

QUESTION:  Thank you.  The question is for both secretaries, but maybe from a different angle.  Could you address the workaround that the Europeans are trying to institute to avoid U.S. banks, maybe using their own central banks or electronic transactions?  For Secretary Mnuchin, how much revenue do you think this would give the Iranians, and how seriously are you taking that in terms of a financial component?

And then Secretary Pompeo, could you talk about once these sanctions go into effect and if the Europeans do try to institute this workaround, what the diplomatic implications for relations with European allies?  Thank you.

SECRETARY MNUCHIN:  I’ll comment on the Special Purpose Vehicle.  I have no expectation that there will be any transactions that are significant that go through a Special Purpose Vehicle based upon what I’ve seen.  But when the details come out of some Special Purpose Vehicle, if there are sanctions – if there are transactions that go through there that have the intent of evading our sanctions, we will aggressively pursue our remedies.

SECRETARY POMPEO:  And let me take the second part of that.  We’ve been working closely with the Europeans on this set of issues.  We’re very confident that our sanctions will be incredibly effective.  And frankly, I can prove that already.  As I stated, the Iranian economy today is already feeling the effects of this.  It’s already feeling the effects of this effort not because the sanctions have snapped back – that won’t occur until – on Monday – but because the world and Iran knew this was coming.  And so European entities of any scale that are doing business with the United States of America have already ceased their conduct with Iran.  There may be an exception to that, but there has been an enormous departure of European businesses.

So whatever it may be that the EU is proposing, the folks who have risk – financial risk, business risk, operation risk – have already made their decision about the effectiveness of the sanctions that will be reimposed this coming week.

MS NAUERT:  Our next question goes to Michele Kelemen with NPR.

QUESTION:  Yeah, hi, thank you.  One quick question that – just technically, which of the eight countries are getting these waivers?  And then secondly, for Secretary Pompeo, you said in one of your interviews this week that the U.S. wants to restore democracy in Iran.  Is that one of the goals of this campaign?  And if so, how do you make sure that these sanctions aren’t going to hurt average Iranians who, as you point out, are suffering under this corrupt regime?

SECRETARY POMPEO:  Yes, thanks for the question.  The President’s policy is very clear:  We are looking to change the Iranian leadership’s behavior.  I laid out the 12 things we’ve asked them to do; that is the goal not only of what we’re speaking about this morning – and please don’t lose sight, we’re talking about a set of sanctions that will be reimposed on Monday.  The administration’s efforts to change Iranian behavior are far broader, far deeper, there are many other lines of effort.  We’re simply focused on this line of effort today because of the significance of November 5th.

My comments about restoring democracy are completely consistent with what we have described before.  We’re counting on the Iranian people to have the opportunity and we are working towards allowing the Iranian people to have the opportunity to have the government they want, a government that doesn’t take wealth from their country and spend it on malign activity around the world.  I mean, this is a regime that is conducting a assassination campaign inside of Europe today, murdering not Iranian citizens in those countries, but folks who live, reside, and are citizens of those European countries.  These are the behaviors we’re trying to change, and our every effort is aimed at giving the Iranian people the opportunity to have the government that they not only want but deserve.

MS NAUERT:  Next question:  Josh Rogin, Washington Post.

QUESTION:  Thank you so much for your time.  Thanks for your service.  I’d like to ask you about the Atomic Energy Organization of Iran.  My understanding is that you waived secondary sanctions on foreign firms that do business with that organization, mostly Russian and Chinese firms that are involved in the Arak and Fordow facilities.  Why did you make that decision, and why are you letting Arak and Fordow continue?  And are there plans to change that in the future?  Thank you.

SECRETARY POMPEO:  Thanks, thanks for the question.  We are not allowing the continued work to develop nuclear weapons and nuclear weapons systems in Arak and Fordow.  We will provide on Monday a complete explanation of what we’re going to do with the continued efforts to prevent those facilities from doing the things that put the world at risk through proliferation, and we’ll give you all the detail.  It’s a long and complex answer, but we’re happy to provide it to you on Monday morning.

MS NAUERT:  Final question to Arshad with Reuters, please.

QUESTION:  Two things.  One, exactly how many financial institutions are going to be redesignated, i.e. put back on the SDN list on Monday?  Previously I believe the number was close to or slightly above 30.  You said it would be substantially more.  How many is it going to be?

Secondly, you pointedly said that you were granting the exceptions to eight jurisdictions.  Is one of those jurisdictions the European Union, thereby covering a much larger group of countries, i.e. 28 EU member-states?

SECRETARY POMPEO:  Steven, you want to go first?

SECRETARY MNUCHIN:  I’ll answer the first part.  So the bank list will come out on Monday.  Again, it will be more than last time, and again, we may continue to add banks to that in the future.  But the original list will come out on Monday and we’ll carefully monitor situations to add on more banks as needed.

SECRETARY POMPEO:  The second part of your question, we will provide the list of the eight jurisdictions on Monday.  The EU will not be receiving an SRE.

MS NAUERT:  The final question, Carol Morello, Washington Post.

QUESTION:  Hi, thanks for doing this.  Say in the past, the Iranians have blended their oil with foreign oil to evade sanctions, and there have already been reports that they are turning off the ID tags on their tankers.  So what in particular are you going to be doing to track their attempts to evade these sanctions?

SECRETARY POMPEO:  Thanks for the question.  Make no mistake about it, the Iranians will do everything they can to circumvent these sanctions – that’s unsurprising to me.  They’ll turn off ships, they’ll try and do it through private vessels, they’ll try and find third parties that don’t interact with the United States to provide insurance mechanisms.  The list of Iranian efforts to circumvent these sanctions is long.  You should all recognize there’s a reason for that.  These sanctions are far tougher than the sanctions that have ever been imposed on the Islamic Republic of Iran.  That is why they are so desperate to find ways to circumvent it. 

And I won’t speak to our efforts to counter those circumvention efforts.  There are many, they are varied, and make no mistake:  The United States is fully prepared to do all that we can to prevent Iran from circumventing not only the crude oil sanctions and the financial sanctions, but all of the designations and all of the other sanctions that are being reimposed this coming Monday and those that are already in place.

SECRETARY MNUCHIN:  And I would just add to that that anybody that does facilitate those transactions will be subject to sanctions and will be added to the list.

MS NAUERT:  Secretary Pompeo, Secretary Mnuchin, thank you so much for joining us.  Everyone, thanks for joining the call.  Have a great day.  We’ll be putting out a transcript shortly.

SECRETARY POMPEO:  Thank you all. 

Photo Credit: Wikicommons

Turkey Exempt From US Sanctions on Iran Oil: Minister

Turkey will be among eight countries allowed by the United States to continue importing Iranian oil, Turkish Energy Minister Fatih Donmez said on Friday.

"We know Turkey is among the countries that will be given an exemption but we do not have the details," the minister said, quoted by state-run news agency Anadolu, as he hailed US statements  to allow imports at low levels after the reimposition of sanctions from Monday.

Donmez hailed US statements to allow imports at low levels after the reimposition of sanctions from Monday.

"I appreciate the positive statement (from Pompeo)," he said after questions from reporters in parliament.

"I believe the point that we have reached will be a positive contribution to the region's peace, comfort and stability," he said, adding that Turkish and American officials held negotiations before Washington's decision.

A US delegation had come to Turkey in July for talks to address Ankara's concerns about the potential negative economic impact of the reimposition of US sanctions against Iran.

Turkey has a strong trade relationship with its neighbor and imports Iranian crude. US President Donald Trump in May decided to abandon the 2015 deal on Iran's nuclear program, signed with other world powers, and bring back nuclear-related sanctions against Tehran.

Pompeo announced that affected countries had pledged to or have already cut back on purchases of petroleum from Iran.

The move "is aimed at depriving the regime of the revenues it uses to spread death and destruction around the world," Pompeo said Friday.

"Our ultimate aim is to compel Iran to permanently abandon its well documented outlaw activities and behave as a normal country."

The US Treasury will also call for the SWIFT global financial network to stop providing services to Iran's banking industry as the United States seeks to hit Tehran over its nuclear programme and alleged support for terrorism.

Relations between Turkey and the US have improved since a diplomatic spat over the two-year detention of an American pastor who was released on October 12.

Earlier on Friday, the NATO allies lifted sanctions against each other's ministers which were implemented in August following a Turkish court's initial refusal to release Pastor Andrew Brunson in July.

Photo Credit: Turkish Ministry Industry

US Details New Sanctions to Hit Iran's Banks, Oil Industry

he United States will add 700 individuals and entities to its Iran blacklist and pressure the global SWIFT banking network to cut off Tehran when expanded sanctions are put in place next week, US officials said Friday.

But eight countries will be able to continue importing Iranian oil at lower levels in order to avoid upsetting global crude markets when the sanctions take effect on Monday, they said.

The US aims to cripple the Iranian economy to pressure Tehran to halt its nuclear activities and what the US says is broad support for "terrorism" in the region, Secretary of State Mike Pompeo said.

The reimposition of sanctions "is aimed at depriving the regime of the revenues it uses to spread death and destruction around the world," Pompeo said.

"Our ultimate aim is to compel Iran to permanently abandon its well-documented outlaw activities and behave as a normal country."

The sanctions come six months after President Donald Trump withdrew from the 2015 nuclear deal struck between world powers and Iran.

At the time, he began reimposing sanctions that had been suspended or removed by his predecessor Barack Obama. That process will be completed starting from midnight Sunday, US eastern time, when sanctions on the regime's banks, shippers, shipbuilders and oil sector are imposed.

The impact remains in question as other countries, particularly Washington's European allies, resist joining its effort to economically strangle the Tehran regime.

The European Union has gone so far as to protect businesses that operate in Iran. It has announced plans for a legal framework through which firms can skirt US sanctions, although few major corporations have been eager to risk the wrath of penalties in the world's largest economy.

"This is not 2012 when the world was united behind sanctions against Iran. This is the Trump administration trying to force the rest of the world to go along with a policy that most countries do not accept," said Barbara Slavin, an Iran expert at the Washington-based Atlantic Council.

"The US has had some success in terms of frightening away major corporations. The sanctions hurt a lot. But Iran is still going to be able to sell oil," especially to China, she said.

Oil Trade Exemptions

Pompeo said the US will grant exemptions to eight countries that have pledged to or have already cut back on purchases of petroleum from Iran, which has long depended on crude exports to power its economy.

He did not name the eight countries, but they are believed to include India, Japan, South Korea, and possibly China.

Pompeo said the countries agreed that the payments for the oil will go into offshore accounts that Iran will only be able to tap for "humanitarian trade, or bilateral trade in non-sanctioned goods and services."

"Maximum pressure means maximum pressure," Pompeo said.

To punish Iranian banks, US Treasury Secretary Steve Mnuchin said the global financial network SWIFT—which enables secure bank-to-bank communications and transactions -- will also be subject to US sanctions if it provides services to Iranian financial institutions on the US blacklist, which includes most major Iranian banks.

That could make it very hard for Iran to do business with other countries.

"SWIFT is no different than any other entity," Mnuchin said.

US Objective in Question

Justifying the action, Pompeo has issued a list of demands for Iran that go well beyond the nuclear program that was the focus of Obama's deal.

He wants the Shiite clerical regime to withdraw from war-ravaged Syria, where it is a critical ally of President Bashar al-Assad, and to end longstanding support to regional militant movements Hezbollah and Hamas.

The US also wants Iran to stop backing Yemen's Huthi rebels, who are facing a US-supported air campaign led by Saudi Arabia.

But experts don't expect Iran's leaders to immediately throw in the towel.

"It's basically magical thinking. The Iranians have been able to continue their support to regional proxies and allies for 40 years despite economic pressure," said Ali Vaez of the International Crisis Group.

He said the Trump administration believed that a constrained, struggling Iran would see its influence erode. But the final goal, he said, was unclear.

"I think the end-game depends on who you're asking. The president himself is interested in having a broader, better deal with the Iranians, but I believe that most of his national security team are interested in either destabilizing Iran or assuring a regime change in Tehran," Vaez said.

Photo Credit: State.gov

Trump Sanctions Set to Bite Iran, But What Next?

Six months after President Donald Trump bolted from a nuclear deal on Iran, the United States from Monday will try to strangle the country's economy with sweeping sanctions, but doubts abound on how effective the campaign will be.

The United States has vowed to reduce sales of Iranian oil, the country's crucial export, as well as international banking transactions, snapping back sanctions lifted by Trump's predecessor as US president, Barack Obama.

But much has changed since the Obama administration targeted Iran's economy in 2012. Obama won broad, if at times begrudging, international support as he set a goal of bringing Iran to the table to end its nuclear program.

Iran—led by a more moderate president, Hassan Rouhani—has according to UN inspectors abided by the 2015 agreement which is still supported by European powers and Russia and China, which all signed the nuclear deal.

"This is not 2012 when the world was united behind sanctions against Iran. This is the Trump administration trying to force the rest of the world to go along with a policy that most countries do not accept," said Barbara Slavin, an Iran expert at the Washington-based Atlantic Council.

"The US has had some success in terms of frightening away major corporations. The sanctions hurt a lot. But Iran is still going to be able to sell oil," especially to China, she said.

The United States has accepted that it will need to issue waivers to countries that do not fully stop buying Iranian oil, with friends of the United States such as India and South Korea looking for sanctions exemptions, and Tehran may keep up clandestine sales.

The European Union has gone so far as to protect businesses that operate in Iran. It has announced plans for a legal framework through which firms can skirt US sanctions, although few major corporations have been eager to risk the wrath of penalties in the world's largest economy.

US Objective in Question

US Secretary of State Mike Pompeo has issued a list of demands for Iran that go well beyond the nuclear program that was the focus of Obama's deal.

He wants the Shiite clerical regime to withdraw from war-ravaged Syria, where it is a critical ally of President Bashar al-Assad, as well as to end longstanding support to regional militant movements Hezbollah and Hamas.

Pompeo has also insisted Iran cut off backing for Yemen's Huthi rebels who are facing a US-backed air campaign led by Saudi Arabia.

In a recent tweet Pompeo crowed that the International Monetary Fund is predicting a 3.6 percent contraction of Iran's economy next year.

"That's what happens when the ruling regime steals from its people and invests in Assad—instead of creating jobs for Iranians, they ruin the economy," he said.

But experts see no rapid turnaround from Iran's leaders—especially the military and clerical establishments, for whom resistance to the United States has been an article of faith since the 1979 Islamic revolution overthrew the pro-US shah.

"It's basically magical thinking. The Iranians have been able to continue their support to regional proxies and allies for 40 years despite economic pressure," said Ali Vaez of the International Crisis Group.

He said the Trump administration believed that a constrained, struggling Iran would see its influence erode. But the final goal, he said, was unclear.

"I think the end-game depends on who you're asking. The president himself is interested in having a broader, better deal with the Iranians, but I believe that most of his national security team are interested in either destabilizing Iran or assuring a regime change in Tehran," Vaez said.

Trump's national security advisor, John Bolton, is a longstanding hawk with ties to Iran's armed, exiled opposition.

North Korea Model?

One European diplomat believed Trump was following his playbook on North Korea, with which he is negotiating only a year after threatening "fire and fury."

“It's the same war plan as with Kim Jong Un and North Korea—sanctions, maximum pressure and then ready to negotiate," he said.

The United States says it is exempting humanitarian goods from the sanctions, although Europeans say they have received no guidance on how to avoid penalties.

Another Western diplomat, speaking to AFP on condition of anonymity, said that Iran was more dependent on the outside world than the country's conservatives would like to think.

"In truth there are starts of a panic as there's beginning to be a shortage of medicine. We're heading back to the old war economy, which is tightly controlled."

Complicating Trump's effort, Saudi Arabia—Iran's regional rival which has long pressed Washington to get tough—is increasingly unpopular after the murder of a journalist, Jamal Khashoggi, in the kingdom's Istanbul consulate.

But Tehran has been winning few friends, with France and Denmark recently accusing the clerical state's intelligence agencies of plotting to attack Iranian opponents in Europe.

Photo Credit: IRNA

US Eyes Limited Waivers for Iran Crude Buyers

The US administration likely will enable some countries to continue importing oil from Iran in the short term, despite Washington's maximum pressure campaign against Tehran, White House national security adviser John Bolton said today.

"We understand, obviously, that a number of countries, some immediately surrounding Iran, and others that have been purchasing oil, may not be able to go all the way to zero," Bolton said at a forum hosted by the Washington-based Alexander Hamilton Society. "We want to achieve maximum pressure, but we do not want to harm friends and allies either. We are working our way through that."

The sanctions statutes that President Donald Trump re-activated in May require the administration to assess by 4 November, and every 180 days after that date, whether buyers of Iranian crude are "significantly reducing" their purchases. The administration can then sanction financial institutions in countries that it deems have not cut their purchases adequately and grant exemptions to countries that do.

The State Department is expected to provide such exemptions before the full brunt of US sanctions pressure begins on 5 November, even though the scope of waivers is yet undetermined.

China, India and Turkey were among the largest buyers of Iranian crude before the US withdrew from the Iran nuclear deal. US sanctions explicitly exclude exports of natural gas from Iran to its neighbors, but lack of guidance from Washington has created uncertainty for natural gas importers in Turkey and Iraq.

Iranian oil exports have fallen faster and by a greater amount than initially expected, as refiners in Asia-Pacific and Europe curbed their purchases, despite opposition from some of their governments.

"You already see reduction in purchases in countries like China, that you would not have expected, countries that are still in the nuclear deal," Bolton said. "European businesses are fleeing the Iranian market. Most of the big ones are already out."

Argus estimates that Iranian crude loadings fell to 1.58mn b/d in September, down by 12pc since August. But these figures do not include vessels belonging to Iran's state-owned NITC, which have stopped transmitting GPS transponder signals. Iran's exports averaged 2.5mn b/d in January-May.

Trump's decision to reimpose sanctions on Iran has contributed to higher oil prices globally, an analysis by the US Energy Information Administration (EIA) shows. But Bolton today downplayed the effect on oil markets.

"One of the things this administration has done that (former president Barack Obama's) administration did not do was to encourage producers to alter their production to make up for the lost output in Iran," Bolton said. "It has been an interesting exercise, but we have been able in some cases to find alternative purchases for the buyers of Iranian oil," he said, without providing details.

Russia and Saudi Arabia increased production since June. Opec and its non-Opec allies will produce as much as necessary to meet global demand and offset any supply disruptions, Saudi oil minister Khalid al-Falih says.

Growing US output and a lower oil import bill have enabled the administration to implement stricter restrictions than were imposed between June 2012 and January 2016 under Obama. These factors also influenced the layout of sanctions in the run-up to 5 November.

"It is important to remember the context in which the Obama administration negotiated (sanctions exemptions) in 2012," given oil prices above USD 100/bl amid a presidential re-election campaign, said Richard Goldberg, a former congressional aide who helped craft Iran sanctions legislation.

"Their strategy was to announce exemptions early to show that the US was willing to provide exemptions and demonstrate that other countries are reducing purchases from Iran," said Goldberg, a senior fellow at the Washington-based advocacy group Foundation for Defense of Democracies, which backs the administration's Iran policy.

By contrast, Trump's administration—partly as a negotiating tool—has kept the scope of waivers unclear, even as the sanctions deadline approaches. It also has yet to clarify the scope of possible financial sanctions and to explicitly exclude condensate from US sanctions.

"Ultimately the Iranians are evaluating what is going to happen on 5 November, how sanctions will be enforced" and what concessions on financial sanctions the EU has managed to extract from Washington, Goldberg said.

Forcing Iranian exports to zero remains the primary objective, Bolton said. "The president said unmistakably our goal is maximum pressure. There has to be a fundamental change in the behavior of the Iranian regime."

Photo Credit: IRNA

EU Bid to Sidestep US Iran Sanctions Hits Quicksand

The EU effort to save the Iran nuclear accord by building a mechanism to buy Tehran's oil despite the return of US sanctions has run into difficulty.

Brussels supports the deal struck in 2015 to curb Iran's nuclear ambitions, which was dealt a blow in May when the US President Donald Trump pulled out.

But Washington has announced the reimposition of broad sanctions from November 4, including on Iran's oil sector, scaring off European traders.

Last month at the United Nations, the EU announced plans for a "special purpose vehicle"—a payment system to continue trade and business ties with Iran.

The renewed US sanctions come into force on Sunday, and work on the mechanism is still going on. 

"We are in the process of putting measures in place. Work is ongoing," EU foreign affairs spokeswoman Maja Kocijancic told reporters on Wednesday.

The payment mechanism has the backing of the remaining five signatories to the Iran deal—Britain, China, France, Germany and Russia.

But senior officials in Brussels admit that it is proving difficult to set up. 

"The undertaking is very complicated... the vehicle will not be operational on November 5," one told AFP.

The EU will publish a statement on Tuesday reaffirming support for the nuclear deal, as long as Tehran continues to respect its side of the bargain.

And an EU diplomat said the plan to create the new entity would be confirmed at the same time.

"The intention is to create a company registered in an EU country which will allow transactions," the official said. 

"We need to supply it with capital and clarify its governance -- this is not easy and it will not just start working overnight."

The three EU deal signatories—France, Britain and Germany—are involved in the project, along with other countries which buy Iranian oil.

But not all EU countries are on board, Iranian agents have been accused of plotting attacks on opposition figures in Europe and US elections are looming.

One European diplomat said the bloc wants to avoid a "direct confrontation" with Trump's administration over Iran before the November 6 congressional poll.

But in any case, the plans—championed by EU high representative for foreign affairs Federica Mogherini—are progressing very slowly.

"For the moment, we're nowhere. There's no will to proceed on the behalf of the member states," one of those negotiating the design of the mechanism said.

Another official insisted: "The plan's not dead." But he admitted the whole enterprise is "politically risky" for capitals wary of antagonizing Washington. 

Oil Prices Up?

US Secretary of State Mike Pompeo has explicitly warned against EU states or companies trying to get around the sanctions, which are a US policy priority. 

The idea is that the SPV acts as a clearing house. Traders would pay into it to buy Iranian exports and Iran's purchases in Europe would be paid by the fund.

This would allow Europeans to trade Iranian oil without sending cash directly to the Islamic republic.

And EU leaders have not ruled out allowing entities from other states keen to avoid US sanctions—notably India, China and Turkey—to use the SPV.

This would blow a hole in US efforts to use oil sanctions to pressure Iran into more concessions than agreed to in the nuclear deal—or face collapse.

But it would also accelerate the widening of the rift between the US and its allies on foreign policy, and Trump may seek to punish firms using the vehicle.

Europe nevertheless hopes it can avoid an immediate crisis, and persuade Iran to stick by its side of the nuclear deal despite Washington's refusal to do so.

“Iranian oil sales won't drop to zero on November 5, the day after the US reimposes sanctions," a European expert told AFP.

"The Americans known that prices are already high and that Iran's exit from the market will only force them higher, which isn't in their interests."

European clients—mainly in Spain, Italy, Greece and France—buy 20 percent of Iran's oil exports.

According to the European Commission, last year EU members bought nine billion dollars of Iranian exports and Iran spent 10 billion in the union.

Photo Credit: Wikicommons

Denmark Says Consulting Allies Over Possible Iran Sanctions

Denmark said Wednesday it was consulting with its allies about possible sanctions against Iran after accusing Tehran of plotting an attack against Iranian dissidents living in the Scandinavian country.

"We are going to reach out to our European allies in the coming days to try to find a united response," Danish Prime Minister Lars Lokke Rasmussen told reporters during a meeting of Northern European leaders in Oslo.

British Prime Minister Theresa May expressed her support for Denmark at the meeting.

Danish Foreign Minister Anders Samuelsen was to begin contacting his European counterparts on Wednesday to discuss possible sanctions against Iran—most likely economic ones, a diplomatic source told AFP.

"We want to preserve the nuclear agreement," Lokke Rasmussen said, referring to how possible sanctions would approach the 2015 international accord on Iran's nuclear program.

Denmark on Tuesday announced it was recalling its ambassador to Iran after the Danish intelligence service PET accused the Iranian intelligence service of "planning an attack in Denmark" against three Iranians suspected of belonging to the Arab Struggle Movement for the Liberation of Ahvaz or ASMLA.

ASMLA is a separatist group that advocates an Arab state in a southwestern Iranian province. Tehran calls it a terrorist organization. 

A Norwegian of Iranian origin was arrested on October 21 for allegedly planning the attack and spying for Iran.

Iran has denied the allegations, saying they were part of a European conspiracy against the Islamic Republic.

NATO Allies

Tehran summoned the Danish ambassador on Wednesday, foreign ministry spokesman Bahram Ghasemi said.

"In this meeting the (senior foreign ministry) official strongly denied the biased reports on a foiled attack plot on an Iranian dissident in Denmark and its attribution to the Islamic republic of Iran," Ghasemi said.

In late September, Tehran accused Denmark, the Netherlands and Britain of "hosting several members of the terrorist group" that Iran holds responsible for an attack in the mainly ethnic Arab city of Ahvaz in southwestern Iran.

The September 22 attack, during which five commandos opened fire on a military parade, left 24 people dead.

The so-called Islamic State group and a separatist Arab group claimed responsibility, and Iran staged several operations in Iraq and Syria in response.

US Secretary of State Mike Pompeo said Tuesday that Washington stood behind Denmark, a NATO ally.

In Oslo for a meeting of the Nordic Council, Northern European leaders were prudent.

"We're working on a concrete response. We've said that we will react," Norwegian Prime Minister Erna Solberg said.

"We are following this very closely together with our Danish friends and when we know more we will make a decision about possible measures," Swedish Prime Minister Stefan Lofven said.

Photo Credit: Wikicommons

After Bolton Takes aim at Russia and Iran, is Armenia the Collateral Damage?

Befitting his bull-in-a-china-shop reputation, John Bolton's whirlwind tour of the Caucasus left a trail of geopolitical wreckage that his hosts are still trying to pick up even after Bolton himself is back in Washington.

As expected, the visit of Bolton, the U.S. National Security Adviser, focused on getting the states of the South Caucasus—Georgia, Armenia, and Azerbaijan—on board with Washington's efforts to isolate Iran.

Bolton visited all three countries, but his public statements in Tbilisi and Baku were more or less pro forma for an American official visiting the Caucasus. It was in Yerevan where he repeatedly made provocative comments that vexed his hosts, and where the fallout from his visit continues.

Armenia's position vis-à-vis Iran is especially delicate, as the ongoing conflict with Azerbaijan has resulted in its borders to the east (with Azerbaijan) and west (with Turkey) being closed. So Armenia relies on its southern border with Iran as a key outlet.

In the past, the U.S. has tended to look the other way at Armenia-Iran ties, even as it pursues broad sanctions against Tehran, since it understands that Armenia has few other options. Bolton, though, suggested that that lenience may be coming to an end.

As the U.S. ratchets up pressure on Iran, the Armenian-Iranian border is “going to be a significant issue,” Bolton told the Armenian service of Radio Free Europe/Radio Liberty.“We are going to squeeze Iran because we think their behavior in the Middle East and, really globally, is malign and needs to be changed.”

Bolton acknowledged that he understood why Armenia needed Iran, but said that the solution was to end the conflict with Azerbaijan.

Bolton told RFE/RL that “current circumstances highlight” the importance of Armenia and Azerbaijan “finding a mutually satisfactory agreement to the Nagorno-Karabakh issue,” referring to the territory over which the two countries are fighting. “Once that happened, then the Armenian-Azerbaijani border would open,” Bolton said. “The Turkish border, I believe, would almost certainly open.”

That is all technically true, but the notion that Yerevan would orient its relations toward Azerbaijan—which it regards as an existential threat—around the U.S.'s policy of isolating Iran fell flat among Armenians.

“John Bolton, or anyone for that matter, cannot speak on my behalf,” Armenian Prime Minister Nikol Pashinyan told a news conference following Bolton's visit. “They are moving forward with the logic that they have some kind of ownership of the Karabakh issue, and now they are attempting to sell it to me, without asking my opinion.”

Bolton's dabbling in Karabakh diplomacy followed a controversial interview given the week before by the outgoing U.S. ambassador, Richard Mills, in which the envoy said it was “disturbing” how few Armenians were willing to make concessions to Azerbaijan over Nagorno-Karabakh. “The harsh reality is that any settlement is going to require the return of some portion of the occupied territories,” Mills told the news site EVN Report.

While that is also technically true, the combined effect of the Mills and Bolton statements added to a sense in Yerevan that the new Pashinyan government's tentative steps toward the West are being repaid by a conspicuous lack of sympathy toward Yerevan's position. On top of that, the Trump administration has evinced little interest in the Caucasus – even by the low standards of the U.S. – and little indication that Washington has anything to offer Armenia in exchange for the dramatic moves Bolton proposed.

“Not since the failed and dangerous Turkey-Armenia Protocols has the United States been so keen on pressuring Armenia to adapt to American priorities in the region,” wrote the Armenian-American news site Asbarez in a commentary on Bolton's visit.

That sense was seized on by members of the former regime. In a Facebook post, former defense minister Vigen Sargsyan criticized “Pashinyan's American fiasco” and complained that “Bolton not only repeated Azerbaijan's thesis that Armenia is to blame for the blockade [of the Armenia-Azerbaijan border], but also justified Turkey's closure of its border with Armenia.”

While in the Caucasus, Bolton also mooted the prospect of the U.S. reversing its policy of not selling arms to Armenia or Azerbaijan. That would almost certainly benefit Azerbaijan more, as Baku has far more money with which to buy American weapons, which are generally much more expensive than the Russian arms on which both Armenia and Azerbaijan largely rely.

Nevertheless, the offer was presented as a sort of carrot for Yerevan. “As I said to the prime minister, if it’s a question of buying Russian military equipment versus buying U.S. military equipment, we’d prefer the latter,” Bolton told RFE/RL. “We think our equipment is better than the Russians’ anyway.”

Bolton also targeted Armenia's recent announcement that it would send a small team of sappers to help Russia in its demining efforts in Syria. “It would be a mistake for anybody else to get involved militarily in the Syrian conflict at the moment,” Bolton told a news conference in Yerevan. “There are already … seven or eight different combatant sides. To get involved with any one of them for any other country would be a mistake,” he said.

The Kremlin, naturally, did not take kindly to Bolton's attempts to drive a wedge between Armenia and Russia; Yerevan is Moscow's closest ally in the Caucasus and Armenia depends heavily on subsidized Russian weaponry.

In a sharply worded statement issued after Bolton left, the Russian Ministry of Foreign Affairs seized on the American's reference to Armenia not needing to be constrained by “historical antecedents” in its foreign relations. Bolton “demanded openly that Armenia renounce historical clichés in its international relations and hardly bothered to conceal the fact that this implied Armenia’s traditional friendship with Russia,” the MFA said, calling the demand “impudent.”

The statement continued: “Incidentally, not all of John Bolton’s statements in Yerevan deserve to be criticized. In his October 25 interview to Radio Liberty, he made a wonderful comment: 'I think that’s really fundamental to Armenia exercising its full sovereignty and not being dependent on or subject to excessive foreign influence.' It would be good if John Bolton thinks over the meaning of his own words.”

Photo Credit: Armenian Prime Minister

Denmark Recalls Ambassador to Iran Over Foiled 'Attack'

Denmark on Tuesday recalled its ambassador to Iran after it accused Tehran of plotting a foiled "attack" against three Iranians living in the Scandinavian country.

"I have decided to recall Denmark's ambassador in Tehran for consultations... Denmark can in no way accept that people with ties to Iran's intelligence service plot attacks against people in Denmark," Danish Foreign Minister Anders Samuelsen told reporters.

"It is the Iranian government, it is the Iranian state that is behind" the plot, Samuelsen said.

He added that he was consulting with "partners and allies", including the EU, about possible sanctions.

Earlier Tuesday, the head of Denmark's intelligence service PET, Finn Borch Andersen, said his agency believed the Iranian intelligence service "was planning an attack in Denmark" against three Iranians suspected of belonging to the Arab Struggle Movement for the Liberation of Ahvaz.

A Norwegian of Iranian origin was arrested on October 21 for allegedly planning the attack and spying for Iran.

The suspect was detained in the southwestern Swedish city of Goteborg, according to the Swedish security service Sapo.

Iran has denied the Danish allegations, with foreign ministry spokesman Bahram Ghasemi saying they were part of a European conspiracy against Iran.

In late September, Tehran accused Denmark, the Netherlands and Britain of "hosting several members of the terrorist group" that Iran holds responsible for an attack in the mainly ethnic Arab city of Ahvaz in southwestern Iran.

The September 22 attack, during which five commandos opened fire on a military parade, left 24 people dead.

The so-called Islamic State group and a separatist Arab group claimed responsibility, and Iran staged several operations in Iraq and Syria in response.

’Will Stand Up to Iran'

Danish Prime Minister Lars Lokke Rasmussen echoed Samuelsen's comments, writing on Twitter: "It is totally unacceptable that Iran or any other foreign state plans assassinations on Danish soil. Further actions against Iran will be discussed in the EU."

In Oslo, where he was meeting other Northern European leaders, Rasmussen spoke with British counterpart Theresa May, whom he said expressed "support" for Denmark.

"In close collaboration with UK and other countries we will stand up to Iran," he added.

Iran's ambassador to Denmark was summoned to the foreign ministry Tuesday for an explanation.

Meanwhile, US Secretary of State Mike Pompeo said the US also stood behind Denmark.

"We congratulate the government of Denmark on its arrest of an Iranian regime assassin. For nearly 40 years, Europe has been the target of Iran-sponsored terrorist attacks. We call on our allies and partners to confront the full range of Iran's threats to peace and security," Pompeo wrote on Twitter.

The US and European countries nonetheless have different approaches to engagement with Iran.

In May, the US pulled out of a 2015 international accord on Iran's nuclear program and in August it reimposed sanctions against Tehran.

A second wave of sanctions is to take effect on November 5.

EU countries, China and Russia want to preserve the 2015 agreement and maintain trade ties with Iran however.

PET's announcement ended weeks of speculation about why Denmark shut down bridges and ferries to Sweden on September 28 during a manhunt that mobilized hundreds of police and the military. 

The shutdown was aimed at foiling the Iranian operation, PET acknowledged on Tuesday.

Photo Credit: Wikicommons

Iran Backlash After Top Cleric Meets Reformists

A hardline member of Iran's powerful Guardian Council was facing a backlash on Sunday after criticizing one of the country's top religious figures for meeting with reformist politicians.

The dispute reflects the diversity of views within Iran's religious elite and the fact that, well after the 1979 Islamic revolution, some senior Shiite clerics fiercely defend their independence.

The controversy started a fortnight ago when 90-year-old Grand Ayatollah Musa Shobairi Zanjani—considered one of the highest religious authorities and a "marja" (or "source of emulation") for huge numbers of Shiite Muslims—met with ex-president Mohammad Khatami and other members of the reformist camp.

Khatami was president from 1997 to 2005 but has since fallen foul of the system, especially after supporting mass protests in 2009, and is banned from leaving the country or appearing in official media.

That meeting drew a shocked response from another leading ayatollah, Mohammad Yazdi, who leads an influential conservative clerical association in Qom, regarded as Iran's religious capital.

Yazdi is one of supreme leader Ayatollah Ali Khamenei's appointees to the Guardian Council, a supervisory body that has a veto over all parliamentary laws.

"Following the publication of pictures on social media of you alongside some problematic individuals who have no respect for the system of the Islamic republic and the supreme leader, I hereby state that this issue has caused concern and upset among followers and in the seminaries," Yazdi wrote in an open letter published by the Jamaran news site.

"I would like to remind you that your status and respect are tied to your respect for the ruling Islamic system, the leadership and the status of marjas... and take steps to ensure such matters are not repeated again," he added.

To criticise a grand ayatollah in this way was considered beyond the pale for many observers.

Abbas Salehi, minister of Islamic culture and guidance, tweeted late Saturday: "We must be careful not to weaken the pure marjas under the banner of preserving the system, and not spoil Shiite historical heritage."

At least one ayatollah resigned from Yazdi's religious association in protest, while another, Ayatollah Hadavi Tehrani, said the "impolite" letter to Zanjani had caused "sadness and sorrow".

Responses continued to come from many senior officials and commentators on Sunday.

"We Shiites are proud that our noble marjas have never gotten permission from any power but glorious God and have not been bound by the constraints of any political and economic bodies," tweeted Elisa Hazrati, a member of parliament and managing director of the reformist Etemad newspaper.

Photo Credit: IRNA

Iran Sells Oil on Exchange in Bid to Counter Sanctions

Iran sold oil to private buyers through its energy exchange for the first time on Sunday, as part of its efforts to counter the imminent return of US sanctions. 

Only 280,000 barrels were sold out of one million offered, and went for USD 74.85 per barrel, more than USD 4 below the initial asking price.

The identity of the buyer remained a secret, with the conservative Fars news agency saying only that a conglomerate of private firms had made the purchase through three brokerages.

The US is set to reimpose sanctions on Iran's oil industry on November 5, following President Donald Trump's decision to walk out of the 2015 nuclear deal in May. 

The plan to sell oil to private companies on the energy exchange was floated back in July by first vice-president Eshaq Jahangiri with the aim of "defeating America's efforts ... to stop Iran's oil exports."

The government hopes selling to private buyers, rather than direct to foreign clients, will make it harder for the US to monitor and stop its sales. 

"With the imminent return of a new wave of sanctions, the government is determined to utilise the maneuvering ability of the private sector to sell Iran's oil and find new markets," Hamidreza Salehi, director of Iran's energy exports federation, told semi-official news agency ILNA.

Some estimates show Iran's crude exports have already dropped by a third since May when it was selling around 2.5 million barrels per day.

The government currently intends to offer oil on the energy exchange once a week, according to Fars. 

Its initial base price on Sunday was USD 79.16, but it received limited bids as much as USD 16 lower as trading began, the exchange's website showed.

The final buyer only emerged after the base price was dropped to USD 74.85 in the closing hours.

The head of Iran's securities and exchange organization, Shapour Mohammadi, promised on Friday that the identity of the buyer would not be revealed.

Photo Credit:IRNA

Europe Support Against US 'Rare Victory' for Iran: Rouhani

President Hassan Rouhani said Saturday that the divisions between the US and Europe over renewed sanctions on Iran were a "rare historical victory" for the Islamic republic.

"If this time last year, we had stated that America would stand against the great nation of Iran... and Europe would stand with Iran and against America, the overwhelming majority of us... would have said that this was pure optimism," Rouhani told lawmakers in a televised address. 

"The political victory of the great nation of Iran over the past months is a rare victory in history."

EU countries have fiercely opposed the decision by US President Donald Trump to abandon their landmark 2015 nuclear deal with Iran and reimpose sanctions—the last of which will return on November 5. 

Rouhani was addressing parliament for a special session to approve four new ministers covering the portfolios of economy, transport, labour and industry.

He acknowledged Iranians were feeling the economic strain, saying: "All of us understand people are suffering and under pressure. People's lives, in particular those on a fixed income, are very difficult."

But he insisted there were sufficient reserves of basic commodities and foreign currency to weather the storm, even after a record-breaking plunge in the rial over the summer and imminent sanctions on its crucial oil industry. 

"We cannot tell our people that because of America's pressure, we cannot do anything. This answer is not acceptable. We cannot tell people that because there are problems with selling our oil, we are unable to manage the country," he said.

He criticized foreign media reports that costs were soaring, despite Iran's own central bank showing food and drink prices had risen 46.5 percent in the year to September. 

"Foreign media lie to people of Iran and say that Iran is the most expensive country people live in," Rouhani said.

Lawmakers later approved the four names put forward by Rouhani: Farhad Dejpasand as economy minister, Mohammad Eslami for transport, Reza Rahmani for industry and Mohammad Shariatmadari for labour. 

The previous economy and labour ministers were impeached by parliament in August, while the other two resigned last week. 

Photo Credit: IRNA

Almost 2 Million Iranian Pilgrims Head Into Iraq for Arbaeen

At the border town of Mehran between Iran and Iraq, a sea of pilgrims surges forwards, en route to one of the biggest religious pilgrimages on the planet.

Iranian organizers say more than 1.8 million Iraqi visas have been issued for Iranians this year for the Arbaeen pilgrimage which culminates on Tuesday as the devout head, many by foot, to Karbala and one of the holiest sites of Shiite Islam, the shrine of Imam Hussein.

Men and women, young and old, toddlers in prams and elderly pushed in wheelchairs—they converge from all over the Islamic republic.

"I go because my heart demands it of me, I go because of my love for Imam Hussein," said Morteza Taghikhani, a 39-year-old auto worker, who had already been on the pilgrimage five times before.

His wife and young children were accompanying him for the first time: "They insisted on coming. Though it is a difficult trip, they've enjoyed it so much."

The pilgrims stream past tents, called "mokebs", which hand out free food ranging from scrambled eggs to boiled turnips. Full meals are served at midday and in the evenings.

The crossing stays open around the clock, but blankets and tents are provided for anyone needing a rest.

Every few meters there is a free shoeshine, and when the pilgrims take off their shoes the attendant kisses their feet as a sign of respect: for Shiites the Arbaeen march is so holy that just serving the pilgrims is thought to bring divine reward.

The pilgrimage marks the martyrdom in 680 of Imam Hussein, grandson of the Prophet Mohammad, who refused to accept the leadership of the "usurper" Caliph Yazid and was massacred along with his followers at Karbala.

’Cannot be Defeated'

Shiite Muslims have honoured his death with elaborate mourning ceremonies ever since and Hussein's last stand has come to serve as a powerful symbol of resolve and sacrifice in the face of oppression.

That imagery remains a key part of Iran's religious and political self-image, and even as modernity has transformed much of the country, the huge scale of the Arbaeen pilgrimage is a reminder of how significant the symbolism remains.

"This march shows world imperialism that the Muslim nation cannot be defeated, whether by economic or military or political means," said Sajjad Entezar, a 23-year-old cleric from the Iranian holy centre of Qom.

Arbaeen marks the 40th day after Imam Hussein's martyrdom, with the devout marching on foot for all or part of the way to Karbala.

Khadijeh Mehrjoo, a 36-year-old city council member from a small town in central Iran, said she was not concerned by the long days and nights—or even Iraq's security issues.

"There is no need to worry, Imam Hussein himself looks after us," she said.

State institutions offer free services and food to pilgrims alongside those of the public, while the national broadcaster gives wall-to-wall coverage for a fortnight before Arbaeen, which falls on October 30 this year.

The march was forbidden for many years, under former Iraqi dictator Saddam Hussein, who fought a devastating war with Iran in the 1980s. Restrictions were only lifted after his downfall in 2003.

With the formation of a new Iraqi state, where the post of prime minister is held by a Shiite, the march quickly became one of the most popular religious pilgrimages in the world.

Even the Islamic State group's emergence and its ruthless campaign against Shiites, which it considers infidels, did not deter the pilgrims.

If anything, the Sunni extremists' seizure of vast swathes of Iraqi territory in 2014—reaching within 70 kilometers (45 miles) of Karbala—only invigorated the faithful, pushing the number of pilgrims into the millions.

For Mehrjoo the pilgrimage is itself a means to defeat the threats against it. "The march creates unity, solidarity," she said.

"If we join hands we can overcome. We can defeat the enemies of Islam."

Photo Credit: IRNA

Four Iran Environmentalists Could Face Death Penalty

Four detained Iranian environmental activists could face the death penalty after the charges leveled against them were changed, the Tehran prosecutor said on Wednesday.

"After completion of the investigation, the charges against four of the defendants have been changed to corruption on earth," said Abbas Jafari Dolatabadi, cited by Mizan Online, a news outlet run by the judiciary.

"Corruption on earth" is one of the most serious charges in Iran and can be punishable by death.

The defendants were initially arrested on suspicion of espionage, but Mizan Online did not specify the charges that had preceded Wednesday's alteration.  

Indictments for eight environmental activists have been issued in total and "are ready to be sent to court," the agency quoted the prosecutor as saying.

“The defendants had been notified of the charges," he added.

The prosecutor did not specify the charges against the other four activists, nor did he say when the trial would be held.

The authorities have not released the names of the defendants, who were arrested in January.

Iran has arrested at least a dozen environmental activists this year on charges of spying for foreign intelligence agencies.

One of them, Kavous Seyed Emami, a 63-year-old professor and renowned environmentalist, allegedly committed suicide in prison in February, a fortnight after his arrest.

Military authorities told the judiciary that the defendants had tried to "get close to military centers and get military information about these centers, under the cover of environmental activities," the prosecutor said.

In early September, the head of Iran's Environment Department, Isa Kalantari, called for the fate of the environmental activists to be explained. 

"We are not asking for their release or for their execution, we just want their fate to be clarified. This is part of their citizenship rights," Kalantari said.

Photo Credit: IRNA

Bolton Visits Caucasus Amid Anti-Iran Campaign

This article has been republished with permission from Eurasianet.

A senior adviser to U.S. President Donald Trump is visiting the Caucasus, where he is expected to try to enlist the region's three governments in Washington's campaign of isolating Iran. But leaders in the Caucasus, wary of confronting Tehran, will likely instead be promoting their own interests to an administration that has thus far largely neglected the region.

National Security Adviser John Bolton is scheduled to arrive in Baku on October 24, before visiting Yerevan and Tbilisi. It will be the highest-profile visit yet by a Trump administration official to all three countries of the Caucasus. None of the three currently has a U.S. ambassador, and policymakers have complained of a lack of American engagement.

Bolton has said his visit will focus on regional security. He told radio host Hugh Hewitt before the trip that he will be “in the Caucasus to see the very significant geographical role that they have dealing with Iran, dealing with Russia, dealing with Turkey.”

In particular, Bolton is expected to focus on Iran, a country that maintains good relations with Armenia, Azerbaijan and Georgia, but which the Trump administration is aggressively attempting to isolate. Bolton is a longtime Iran hawk and a leading advocate in the administration for leaving the Iran nuclear deal and reimposing sanctions on Tehran.

“I can't figure out what else [besides Iran] he would have to discuss” in the Caucasus, said Paul Stronski, senior fellow in the Russia and Eurasia Program of the Carnegie Endowment for International Peace, a Washington, DC, think tank.

“Last month at the United Nations, Trump called for international action to deter Iran, but his efforts have for the most part been unsuccessful,” said Carey Cavanaugh, a retired U.S. ambassador who worked in the Caucasus, in an interview with Armenian news website news.am. “Now Bolton is trying to secure support in the Caucasus and in Moscow so as to counter Iran influence.”

In its long diplomatic and economic campaign against Iran, Washington has tried to force other countries to also curtail ties with Tehran. But it has tended to look the other way at the Caucasus countries' growing ties with Iran, given their geographic proximity. Especially in the case of Armenia, Iran provides a critical lifeline as its borders to the east (Azerbaijan) and west (Turkey) are closed.

“It's always a friction point,” Stronski told Eurasianet. “Because of U.S. concerns and U.S. sanctions, these countries have not developed as robust economic ties [with Iran] as you would expect for such close geographic neighbors. But they have always been able to push back at criticism, simply because they have no other options.”

It is not clear, however, whether the Trump administration intends to stick to this hands-off policy with regard to the Caucasus and Iran. “U.S. policy is so muddled right now that it's really hard to figure that out,” Stronski said. “The M.O. of this administration is to make big pronouncements and then not be as clear in the follow through. But Bolton and Trump certainly feel strongly about Iran and so maybe they will be putting in that second level of guidance.”

In any case, the increasing pressure has complicated the Caucasus countries' already precarious geopolitical position.

“The pullout from the JCPOA puts these countries in a difficult position,” Stronski said, referring to the Trump administration’s withdrawal from the 2015 nuclear deal with Iran. “The horrible deterioration in U.S.-Russia relations has made their balancing act very difficult, and to the south you have a similar deterioration. It really puts these countries between a rock and a hard place.”

While Iran is likely at the top of Bolton’s agenda, his interlocutors in the Caucasus may instead try to steer the conversation away from Iran and towards their priorities instead.

In Tbilisi, Georgian government officials are unlikely to want to get drawn into a U.S.-Iran conflict, instead preferring to keep the agenda focused on issues like security cooperation, said Kornely Kakachia, the director of the Georgian Institute of Politics.

“Georgia remains a steadfast supporter of U.S. initiatives,” Kakachia told Eurasianet. “However, due to permanent pressure from Russia it can't endanger its national interest, which seeks pragmatic and balanced relations with Iran. So, as in the last decade, Tbilisi will try to find a delicate balance between its regional interests and those of the West.”

Similarly, the Azerbaijani side is likely to seek more active engagement of the U.S in resolving the conflict with Armenia over Nagorno-Karabakh, said Zaur Shiriyev, a Baku-based analyst for the International Crisis Group. “The Azerbaijani side is reluctant to be seen in Iran as participating in U.S. policy. It could be misinterpreted by Tehran, and Baku doesn’t want to damage its bilateral relations with Iran,” Shiriyev told Eurasianet. “The Nagorno-Karabakh issue will be the top issue [for the Azerbaijanis when Bolton visits], but it is hard to expect much new initiative from the U.S. side,” he added.

“Baku nurtures hopes for U.S. efforts as co-chairman of the Minsk Group of the OSCE,” the body attempting to resolve the Nagorno-Karabakh conflict, wrote the haqqin.az website in a recent commentary. “And, of course, Baku will be conducting negotiations with Bolton exactly on this.” 

In Armenia, Bolton will be meeting with a new leadership which has promised dramatic domestic reforms but thus far vowed no significant foreign policy shifts. Still, Yerevan is trying to formulate a strategy for dealing with an administration that has moved away from the traditional U.S. emphasis – at least rhetorically – on democratization and toward a “more neorealist approach which is predicated on interests-sharing and functions-sharing,” said Eduard Abrahamyan, a London-based analyst of Armenia.

“From Armenia's perspective, there is a genuine intention to balance Russia through proactive engagement with the United States on one side and with Iran from the other,” Abrahamyan told Eurasianet. “This means advancing Armenia-Iran strategic ties while being transparent with the U.S. about the core intentions.”

Photo Credit: U.S. Embassy Kyiv

Iran Condemns 'Sultan of Coins' to Death for Economic Crimes

A court in Iran sentenced to death a financial trader known as the "Sultan of Coins" on Sunday, along with another man, the judiciary's Mizan Online news agency reported.

"Two of those convicted of spreading corruption on earth in preliminary hearings had their case reviewed in the Supreme Court and were sentenced to death today," said judiciary spokesman Gholamhossein Mohseni-Ejei.

"Corruption on earth" is the gravest charge in the Islamic republic which warrants a death sentence.

One of the two men set for death row was identified as Vahid Mazloumin—the trader popularly referred to as the "Sultan of Coins" in Iranian media.

Mizan named the other as Mohammad-Esmaeel Ghasemi, without elaborating.

The pair first went on trial on September 8 over charges of "disrupting the economy" through the creation of a network trading in illegal currency and gold coins, Mizan reported.

A third person, Hamid Bagheri-Dermani, was also accused of corruption and sentenced to death in the preliminary hearings. His case is still up for appeal before the Supreme Court.

Ejei said the swift conclusion of the cases served as a "warning to opportunists" aiming to disrupt the economy during the time of the "enemy's pressure" on Iran.

Iran's crackdown on such corruption has intensified since its economy tanked over internal difficulties coupled with the US withdrawal from the 2015 nuclear deal in May and reimposition of sanctions.

Photo Credit: IRNA

Europeans Want Iran Bank Connected to World: French Senator

European nations are seeking to ensure at least one Iranian bank stays connected to the world after the US imposed new sanctions against the country, a French senator said in Tehran on Sunday.

The United States pulled out of a landmark 2015 nuclear deal with Iran in May and has been reimposing punishing sanctions on the Islamic republic, targeting in particular its financial system.

The European efforts to help Iranians benefit from the nuclear deal despite the US sanctions is "difficult but it's possible", said French Senator Philippe Bonnecarrere.

One way was "to have at least one Iranian bank remain connected to the international banking system through SWIFT to keep up commercial relations on goods or services that are not subject to sanctions," he added.

Bonnecarrere, who heads the France-Iran friendship group in the upper house of parliament, made the remarks during a news conference with French and Iranian counterparts.

The 2015 nuclear deal was agreed between Iran and the so-called 5+1 group—UN Security Council permanent members Britain, China, France, Russia and the United States, plus Germany.

Bonnecarrere was in Iran with six other members of the French parliament.

The visit was a sign of "all the determination and all the will of France to keep alive the nuclear agreement," said Delphine O, one of lawmakers.

Photo Credit: France en Iran

Iran's Industry and Roads Ministers Resign

Iran's President Hassan Rouhani has accepted the resignation of the embattled ministers of industry and roads, a statement on the presidential website said Saturday.

The president thanked industry minister Mohammad Shariatmadari and roads minister Abbas Akhoundi's "selfless service" and "sincere efforts" during their tenures and appointed two acting ministers.

Reza Rahmani, current deputy industries minister, will take over for Shariatmadari and the current governor of Mazandaran, Mohammad Eslami, will become acting roads minister effective immediately, the website said.

The two ministers reportedly handed in their resignations over a month ago as lawmakers were preparing impeachment proceedings against them.

Rumours of Shariatmadari's resignation first surfaced mid-September but were quickly denied by the ministry.

Akhoundi published his resignation letter dated September 1 on Saturday, pointing to a "difference of opinion" as the main cause.

Rouhani's labour and economy ministers were sacked by the parliament in August over their handling of an economic crisis, partly triggered by the withdrawal of the United States from the 2015 nuclear deal and reimpoisition of sanctions.

Rouhani himself was summoned to the parliament to answer questions from lawmakers on August 28, a first in his five years in power, and only the second time for a sitting president.

Lawmakers were also ready to impeach education minister Mohammad Bathaei but called it off on September 2 due to the upcoming school year.

Photo Credit: IRNA

FATF Grants Key Extension for Iran Financial Reforms

The Financial Action Task Force has granted Iran until February to complete necessary reforms in the area of anti-money laundering and combating financing of terrorism. In a statement issued following the conclusion of the group’s plenary meeting in Paris, the FATF announced that it had “decided at its meeting this week to continue the suspension of counter-measures.”

The move will be seen as a victory by reform-minded bankers and politicians in Iran, who have battled fierce domestic opposition and foreign skepticism to push through critical legislation required by the FATF action plan.

The United States, which recently took over the presidency of the FATF, had been pushing aggressively for Iran to be returned to the so-called “blacklist.” Senior Republican lawmakers had recently written to President Trump to ask him to ensure Iran would not be able to earn a clean bill of health from the FATF.

But European resistance, motivated in part by a desire to avoid politicizing the evaluations of the global body, helped ensure a fairer assessment of Iran’s technical progress on its action plan.

Despite the extension, Iran will continue to face pressure to complete its reforms. In its statement, the FATF expressed, “its disappointment that the majority of the Action Plan remains outstanding and expects Iran to proceed swiftly in the reform path.”

The group’s statement identifies nine items that remain to be addressed. At a minimum, by February of next year, “the FATF expects Iran to have brought into force the necessary legislation in line with FATF standards” in order for counter-measures to remain suspended.

The full statement follows below:

In June 2016, the FATF welcomed Iran’s high-level political commitment to address its strategic AML/CFT deficiencies, and its decision to seek technical assistance in the implementation of the Action Plan. Given that Iran provided that political commitment and the relevant steps it has taken, the FATF decided in June 2018 to continue the suspension of counter-measures.

In December 2017, Iran established a cash declaration regime. Since June 2018, Iran has enacted amendments to its Counter-Terrorist Financing Act and Parliament has passed amendments to its AML law and bills to ratify the Palermo and TF Conventions. The FATF notes the progress of the legislative efforts. As with any country, the FATF can only consider fully enacted legislation. Once the remaining legislation is fully in force, the FATF will review this alongside existing enacted legislation to determine whether the measures contained therein address Iran’s Action Plan, in line with the FATF standards.

Iran’s action plan expired in January 2018. In October 2018, the FATF noted that the following items are still not completed and Iran should fully address its remaining items, including: (1) adequately criminalising terrorist financing, including by removing the exemption for designated groups “attempting to end foreign occupation, colonialism and racism”; (2) identifying and freezing terrorist assets in line with the relevant United Nations Security Council resolutions; (3) ensuring an adequate and enforceable customer due diligence regime; (4) ensuring the full independence of the Financial Intelligence Unit and requiring the submission of STRs for attempted transactions; (5) demonstrating how authorities are identifying and sanctioning unlicensed money/value transfer service providers; (6) ratifying and implementing the Palermo and TF Conventions and clarifying the capability to provide mutual legal assistance; (7) ensuring that financial institutions verify that wire transfers contain complete originator and beneficiary information; (8) establishing a broader range of penalties for violations of the ML offense; and (9) ensuring adequate legislation and procedures to provide for confiscation of property of corresponding value.

The FATF decided at its meeting this week to continue the suspension of counter-measures. However, the FATF expresses its disappointment that the majority of the Action Plan remains outstanding and expects Iran to proceed swiftly in the reform path to ensure that it addresses all of the remaining items by completing and implementing the necessary AML/CFT reforms. By February 2019, the FATF expects Iran to have brought into force the necessary legislation in line with FATF standards, or the FATF will take further steps to protect against the risks emanating from deficiencies in Iran’s AML/CFT regime. The FATF also expects Iran to continue to progress with enabling regulations and other amendments.

Iran will remain on the FATF Public Statement until the full Action Plan has been completed. Until Iran implements the measures required to address the deficiencies identified in the Action Plan, the FATF will remain concerned with the terrorist financing risk emanating from Iran and the threat this poses to the international financial system. The FATF, therefore, calls on its members and urges all jurisdictions to continue to advise their financial institutions to apply enhanced due diligence, including obtaining information on the reasons for intended transactions, to business relationships and transactions with natural and legal persons from Iran, consistent with FATF Recommendation 19.

Photo Credit: IRNA