Israel, U.S. Mulling Further Sanctions on Iran

U.S. Treasury Undersecretary for Terrorism and Financial Intelligence, arrived in Israel for talks with top Israeli diplomatic and security officials.

ברק רביד - צרובה
Barak Ravid
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ברק רביד - צרובה
Barak Ravid

Israel and the U.S. have been discussing a new series of sanctions to be imposed on Iran in the event that nuclear talks between six powers and Teheran on June 18 end in failure. Officials in Jerusalem and Washington have confirmed that these discussions about new sanctions are being held.

David Cohen, the U.S. Treasury Undersecretary for Terrorism and Financial Intelligence, arrived in Israel on Sunday for talks with top Israeli diplomatic and security officials. Cohen's discussions related to sanctions against Syria and monitoring of the flow of money to terror organizations.

Cohen, who coordinates the U.S. sanctions policy against Iran, said in an interview with Haaretz that the U.S. and Israel are discussing a new list of sanctions against Iran. "We are working with our partners, including the Israelis, to talk about additional steps to enhance the pressure," Cohen said.

"We have today and over the past years had very close cooperation with the Israeli government across a range of our sanctions programs. They are a very good partner. They are creative. They are supportive and we will continue to consult with the Israelis."

A well-placed Israeli official said that Cohen will meet during his visit with Mossad chief Tamir Pardo, IDF Intelligence head Maj. Gen. Aviv Kochavi, national security adviser Yaakov Amidror, Bank of Israel Governor Stanley Fischer and top foreign ministry officials. The source confirmed that the U.S. and Israel have taken up staff work to draft a possible new list of sanctions against Iran, in the event that the June 18 negotiations between the six powers and Tehran break down.

In the interview, Cohen indicated that new sanctions would be imposed should these negotiations fail. "The important point for the Israeli public to understand and for the Iranian leadership to understand is that if we are not able to make progress on the diplomatic track there is additional pressure that can be brought to bear on the pressure track. If we don't get a breakthrough in Moscow there is no question we will continue to ratchet up the pressure," he said. As things stand, starting on June 28 any country that purchases oil from Iran and relays payments to its central bank will face sanctions imposed by the U.S. government. In order to avoid the U.S. sanctions, states will have to prove that they have reduced the import of oil from Iran. On July 1, the European Union's oil embargo on Iranian oil will go into effect.

"We have already begun to see the combined effect of those two measures," Cohen explained. "The countries in the EU that already reduced the amount of oil they are importing from Iran, Japan and number of other countries did the same. The effect of this is that Iran today is able to sell less oil than six months ago. There are reports of oil tankers sitting off the cost of Iran full of oil, just in storage, because they can't find buyers."

Cohen noted that Iran is having problems securing payments from countries for its oil exports. "They are also encountering difficulties getting paid for the oil they are able to sell," he explained. "Iran's ability to get access to the revenues from that oil was limited by the sanctions that we have applied. The result is that Iran's revenue from oil sales - that is by far it's most important source for revenues for the government - is under pressure. Though the U.S. government is convinced that the sanctions have had significant effect in Iran, the Obama administration is aware that they have yet to bring about a strategic change in Tehran's nuclear policies.

"There is no question that the sanctions have been effective. We have had a quite significant economic effect on the banks that have been facilitating Iran's nuclear program," Cohen said. "Whether that has resulted in a change in the political approach to the nuclear program - time will tell. The Iranian willingness to come to the table in Istanbul and Baghdad and now in Moscow can be traced directly to the pressure they are feeling from the sanctions, but the objective is to bring about a strategic change with regard to the nuclear program, and I recognize that more needs to be done and we intend to do that."

Read this article in Hebrew

Deputy Foreign Minister Danny Ayalon, left, with Cohen. Credit: Gidon Markovitz

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