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Iran halts oil shipments to Britain and France

PARIS — Iran ordered a halt of oil exports to Britain and France on Sunday, in what may be only an initial response to the European Union decision to cut off Iranian oil imports and freeze Iran's central bank assets.

Britain and France depend little on Iranian oil, however, so their targeting may be a mostly symbolic act, a function of the strong positions the two nations have taken in trying to halt Iranian nuclear enrichment and bring pressure to bear on Syria, one of Iran's closest allies.

Iran may also be reluctant, when its economy has been damaged by existing sanctions, to deprive itself of revenues from its larger European customers. At the same time, it may be seeking to divide the 27-nation EU between those who depend on Iranian oil and those who do not.

Sunday's order, according to the Mehr News Agency in Tehran, came from the Iranian oil minister, Rostam Qassemi, who had warned this month that Iran would cut off oil exports to "hostile" European nations.

The Oil Ministry spokesman, Ali Reza Nikzad-Rahbar, confirmed that shipments to Britain and France had been cut off, and said on the ministry website, "We have our own customers and have no problem to sell and export our crude oil to new customers."

At the same time, according to the news agency, an official at the Oil Ministry said Iran was seeking longer-term contracts of two to five years with other European nations.

There was no immediate reaction from French officials, and the British Foreign Office in London declined to comment.

Jean-Louis Schilansky, president of the French Union of Petroleum Industries, told the French newspaper Le Monde that "the Iranian decision has no practical, direct consequences" for France, which since 2011 "practically stopped importing Iranian oil."

Iran is dependent for foreign currency from oil sales, which supply more than 50 percent of the national budget and account for 80 percent of exports. Iran produces about 3.5 million barrels a day and exports about 2.5 million, 70 percent of that to Asia.

The 27 nations of the EU are a big customer as a whole, representing about 18 percent of Iran's exports.

But Britain and Germany only get about 1 percent of their oil from Iran and France only about 3 percent. Other European countries, like Greece, Italy and Spain, are much more reliant on Iranian oil. Greece, for instance, gets about one-third of its oil from Iran, while Italy and Spain each get about 13 percent, according to EU figures.

Greece, Italy and Spain were more reluctant than Britain, France and Germany to vote for rapid oil and banking sanctions against Iran.

Britain, France and Germany are also the European nations negotiating with Iran on its nuclear program in the talks that also include the United States, Russia and China, and are presided over by the EU policy chief, Catherine Ashton.

France and Britain have pushed to increase sanctions against Iran to get it to stop nuclear enrichment in what many in the West believe to be an Iranian program to build a nuclear weapon. The sanctions are part of a dual-track strategy that combines pressure with negotiations. Germany, however, has explicitly opposed any military action against Iran, while Britain and France, like the United States and Israel, have refused to rule out military action.

Iran denies that its nuclear program has any military intent, but it has flouted repeated Security Council resolutions requiring it to stop nuclear enrichment and cooperate fully with the International Atomic Energy Agency.

Merging conciliation with threat, Iran has recently boasted that it was about to start a vast new array of centrifuges to enrich uranium deep in a mountain that would be very difficult to bomb, while it has renewed its call for negotiations after a gap of a year.

French officials believe the threat of new sanctions, and the bite of older ones, together with the travails of the Syrian government and the hints of military action coming from Israel, are bringing Iran back to the table. But the officials also are concerned that the Iranian offer for talks is simply another way to buy time while the centrifuges continue to turn.

Last week, Iran sent a letter to Ashton calling for a new round of negotiations with the group of six, in response to a letter from her on Oct. 17. The Iranian letter, from the country's nuclear negotiator, Saeed Jalili, declared Iran's "readiness for dialogue" at "the earliest possibility." The letter, which was vague but did not contain preconditions, was greeted by Ashton and Secretary of State Hillary Rodham Clinton with a mixture of optimism and skepticism.

Iran halts oil shipments to Britain and France 02/19/12 [Last modified: Monday, February 20, 2012 7:36am]
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