U.S. Senate passes sanctions on Iran Central Bank

Iran Materials 2 December 2011 14:02 (UTC +04:00)
The U.S. Senate has unanimously approved economic sanctions on Iran targeting the country's oil industry, despite warnings the move could backfire.
U.S. Senate passes sanctions on Iran Central Bank

Azerbaijan, Baku, Dec. 2 / Trend S.Isayev/

The U.S. Senate has unanimously approved economic sanctions on Iran targeting the country's oil industry, despite warnings the move could backfire, BBC reported. The measures, passed by 100 votes to nil, would ban foreign firms from doing business with the Iranian Central Bank.

Before it can become law, it must be approved by the House and President Barack Obama.

Earlier, on Thursday, EU accepted additional sanctions against 179 individuals and institutions associated with the Iranian authorities. The decision was taken at the meeting of the EU countries FMs in Brussels. The IAEA Board of Governors adopted a resolution on November 18, calling on Iran to open access to the agency's experts to nuclear sites and insisting on greater cooperation between Iran and the Agency.

The intentions to impose additional sanctions came to notice after a report by the IAEA on Iran's nuclear program. It stated that Iran used to carry out work on nuclear weapons development until 2003, and these very activities could still go on today.

Meanwhile, diplomats at the Iranian embassy in London must leave Britain by Friday afternoon. The diplomats were ordered to go after on Nov. 29 group of protesters broke away from a crowd of a few hundred outside the main British embassy compound in Tehran, scaled the gates, broke the locks and went inside. Protesters pulled down the British flag, burned it and put up the Iranian flag instead.

Police appeared to have cleared the demonstrators in front of the main embassy compound, but later clashed with protesters and fired tear gas to try to disperse them.

The UK closed its embassy in Tehran and requested from Iran to call back his diplomats from the United Kingdom.

Iran has also banned foreign media from covering any rallies in front of British diplomatic missions in the capital on Tuesday, in the latest fallout from the storming of Britain's embassy in Tehran by pro-government demonstrators. The attack on the compounds on Tuesday was preceded by rally outside the British Embassy to denounce UK's support for the latest round of Western sanctions on Iran over its disputed nuclear program.

In recent weeks the U.S. has introduced sanctions against Iran's financial sector, although it has stopped short of targeting the central bank outright. President Barack Obama has been cautious about harsher sanctions, fearing such a move could disrupt the oil markets at a time of economic uncertainty for many Americans, and alienate potential allies.

U.S. officials have also warned that depriving global markets of Iranian exports could send oil prices sharply higher, gifting Tehran a funding boost. Unless a compromise is reached, the president will have to decide whether to veto it.

The U.S. has forbidden its own banks from dealing directly with the Iranian central bank. Under the new sanctions, drafted by Democrat Robert Menendez and Republican Mark Kirk, foreign banks that do business with Iran's central bank would be cut off from the US financial system.

The sanctions are designed to come into effect after a six-month grace period - in order to give oil markets time to factor them in.

The measures were part of a much larger defense bill, which also cruised through the Senate on Thursday night.