June 15, 2012

Iran News Roundup: June 15, 2012

Tightening Oil Trade

OPEC Secretary General Abdullah Al-Badry has announced oil prices could elevate to $110 without putting the global economy in jeopardy (AP 6/15). He said, “$110 is not a threat to the world economic growth,” after OPEC leader agreed yesterday to keep OPEC’s total output ceiling at 30 million barrels a day (AP 6/15).
India has said that it will need extra oil from OPEC, after stopping imports from Iran, raising additional concerns that oil prices will rise as the effects of sanctions on Iran compound (International Business Times 6/15).
Five major Asian IPOs were cancelled or postponed in recent weeks ahead on increased sanctions on Iran (Reuters 6/15). Among them, Hyundai Oilbank has postponed its $2 billion initial offering due to the euro zone crisis and pending Western sanctions on Iranian crude exports, which account for approximately 20 percent of its total imports from Iran (Reuters 6/15).
Barring an unexpected last-minute deal to relax EU sanctions before they go into effect July 1, the Europe-based Protection and Indemnity clubs that cover 95 percent of the world’s oil tankers will be unable to insure vessels carrying Iranian crude (Reuters 6/14). Analysts say this could cut Iran oil shipments beyond the 25 percent fall they have already sustained due to sanctions (Reuters 6/14).
Japan’s lower legislative house has approved a bill to provide government guarantees on insurance for Iranian crude cargoes, making it the first country to take action to mitigate EU sanctions on Iranian oil shipments (Reuters 6/15). Together Japan, South Korea, China, and India buy two-thirds of Iran’s oil exports, relying under normal circumstances on European firms to insure them (Reuters 6/15).
Iranian Enrichment

William Broad writes that Iran may have cover to enrich uranium above current 20% levels: “Iran’s justification could be the same as that of Belgium, France and the Netherlands. The countries, all signers of the nonproliferation treaty and subject to regular atomic inspections, use highly enriched uranium to make the radioactive isotope molybdenum-99, which is widely used in medicine for diagnostic scans and cancer treatments.” (NYT 6/14)
Notable Opinion – “Obama’s Drift Toward War With Iran”
Robin Wright writes at The Atlantic that Obama is overestimating his political exposure from Iran negotiations and underestimating his maneuverability to strike a deal to prevent war:

The most undercovered story in Washington is how President Obama, under the influence of election-year politics, is letting America drift toward war with Iran. This story is the unseen but ominous backdrop to next week’s Moscow round of negotiations with Iran over its nuclear program.
The basic story line, pretty well known inside the beltway, is simple: There are things Obama could do to greatly increase the chances of a negotiated solution to the Iranian nuclear problem, but he seems to have decided that doing them would bring political blowback that would reduce his chances of re-election.
The good news is that Obama’s calculation may be wrong. The blowback he fears–largely from Bibi Netanyahu, AIPAC, and other “pro-Israel” voices–is probably less forbidding than he assumes. And the political upside of successful statesmanship may be greater than he realizes.

Read more at The Atlantic.
US-Russian “Chill” Ahead of Talks
Russia’s foreign minister announced that Russia is not interested in discussing a resolution to the crisis in Syria that leaves out President Bashar Assad, only a day after State Department spokeswoman Victoria Nuland suggested that post-Assad strategy was being discussed by the US and Russia (AP 6/15). This correction follows a week of traded accusations between Russia and the US regarding allegations of supplying weapons to the growing civil war in Syria (Bloomberg 6/14).
Andrew Kuchins of the Russia and Eurasian Programs at the Center for Strategic and International Studies has said, “Obama really has no leverage to deal with Putin” (Bloomberg 6/14).
Saudi- Iranian Relations
Iran claims to have arrested the “’main elements’” behind the assassination of two nuclear scientists, Mostafa Ahmadi Roshan and Majid Shariari, who were allegedly Israeli spies. (The Guardian 6/14). Iran has not provided additional information on the nationalities, numbers, or names of the suspects, who are said to be detained (The Guardian 6/14).
Iran has announced that Saudi Arabia’s King Abdullah will not be invited to a summit of the Non-Aligned Movement in Tehran, following the execution of a group of Iranians on drug trafficking charges (AP 6/14).

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