US sanctions Iran's Central Bank

Repots have emerged that US President Barack Obama has put in place tigther sanctions on Iran's government and the country's Central Bank. Obama has reportedly frozen the Islamic Republic's asses held or traded in the US.

On Sunday 5th February, Obama said US and Israel were “in lockstep” as regards their policy towards Iran.

Both countries, as well as many other Western nations, are worried that Iran is in the process of developing nuclear weapons. Tehran, however, maintains that the country's nuclear programme is designed for civilian use only.

The new sanctions include a block on the Central Bank of Iran; imposed "in light of the deceptive practices" it reportedly keeps in order to conceal business transactions already banned by previous sanctions.

For more news and expert analysis about Iran, please see Iran Strategic Focus.

New oil minister approved by Majlis

After months of political infighting in Iran over who will head up the oil ministry, a suitable candidate has finally been found: Brigadier General Rustem Ghassemi , a member of the all powerful Revolutionary Guard or Sepah who for the past few years as headed up the Sepah's contracting arm, Khatam Ol Anbia (or Ghorb ), which has benefited from several lucrative gas contracts, including a $2 billion deal to oversee Phases 15 and 16 of the giant South Pars project.

But Khatam's ability to secure any external funding has been made almost impossible by US and EU sanctions, which have designated the company a supporter of weapons proliferation. Ghassemi, who unlike his predecessor Massoud Mirkazemi has some oil industry experience, was nominated by President Mahmoud Ahmadinejad at the end of July to be full-time minister and the following week received the all-clear from the Majlis or parliament. Ahmadinejad, who is desperate to secure control of the oil sector to increase his political clout, in June nominated a close ally Ali Aliabadi , to be caretaker minister. But Aliabadi, who was most recently head of Iran's Olympic Committee, wasnever going to get parliament's approval.

For more news and expert analysis about the Caspian region, please see Caspian Focus.

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© 2011 Menas Associates

Iran threatens to cut India exports

The Iranian government has threatened to cut off oil exports to India by August if India does not make payments of over $2 billion for oil it has already received from Iran. The National Iranian Oil Company (NIOC) made the warning in a letter sent to Indian refineries that had been purchasing Iranian crude on credit.

The controversy began late last year when the Reserve Bank of India stopped using the Asia Clearing Union (ACU) to settle Indian payments to Iran because of ACU's non-adherence to US and EU sanctions. Ever since, India and Iran have examined alternative payment mechanisms, with no apparent success.

Fars News Agency later questioned the authenticity of the news, referring to an unnamed informed source at the Ministry of Petroleum who blamed foreign media for releasing reports based on what they have heard. This is while two Iranian industry officials confirmed sending a letter to Indian refiners.

Iran's threat comes at a time when the Saudis are significantly increasing their oil production and exports. Saudi Arabia, which is India's largest supplier of oil, has already offered India an extra 2.5 million barrels of crude to replace any loss of Iranian imports.

For more news and expert analysis about Iran, please see Iran Strategic Focus.

© 2011 Menas Associates

Iran: Ahmadinejad sacks three ministers

Iran's President Mahmoud Ahmadinejad has sacked three ministers as part of a bigger plan to merge several ministries. The country's Oil Minister Masoud Mirkazemi was one of the officials removed from office. In a televised address, Ahmadinejad said: “The Iranian government and Parliament (Majlis) have consensus on the Oil Ministry merger…I am the caretaker for the Oil Ministry.”

Iranian authorities have said that the decision to merge ministries was based on a “legal duty” and pointed out that the country's government is obligated to implement the law in view of “executive and scientific” obligations.

The three ministries to undergo mergers include: the ministry of Roads and Transportation to be merged with Housing and Urban Development; Energy with Oil; Industries and Mines with Commerce; and Welfare and Social Security with Labor and Social Affairs.

On Saturday 14th May, Ahmadinejad issued three decrees dismissing Welfare Minister Sadeq Mahsouli, Minister of Mines and Industries Ali Akbar Mehrabian and Mirkazemi in accordance to the 53rd article of the Iran's Five-Year Development Plan.

The plan stipulates that Iranian government is expected to downsize its ministries form 21 to 17 if it's to improve the efficiency of state administration.

Sources: Press TV, Business Week, Bloomberg, AFP

For more news and expert analysis about Iran, please see Iran Strategic Focus.

Iran's nuclear plant begins work

On Sunday 8th May, Iran's first nuclear power plant started work after months of preparations. The plant, located in the Southern city of Blusher, has begun operating on "minimum controllable level of power". It is expected to start generating electricity after about two weeks, and will join the national gird in the next several months.

In 1995, Iran penned a deal with Russia's Atomstroiexport Company which stipulated that all works should be completed by 1999; however, the project was continually delayed by Russia due to pressure from the US over Iran's nuclear programme. Construction was finally competed in 2010.

In October, Iran began injecting fuel into the power plant in the initial phase of launching the nuclear reactor while also carrying out special security measures to ensure safety. In March, after a safety scare Iran then started reloading fuel into the core of the reactor and said it would begin operating sometime in early May.

The safety of the plant was confirmed by Head of the Atomic Energy Organization of Iran (AEOI), Fereidoon Abbasi, and also in March by the Head of the International Atomic Energy Agency (IAEA) Nuclear Safety and Security Department Olena Mykolaichuk who said: "We realized that Iran's safety system responsible for inspecting Iranian nuclear facilities and installations acts very well and is strong."

Sources: BBC News, Fars News Agency, AP

For more news and expert analysis about Iran, please see Iran Strategic Focus.

Iran's nuclear scientist killed by member of Mossad

Reports have emerged that Iranian authorities have arrested "a member of Mossad terrorist network” suspected to be behind last year's killing of nuclear scientist Massoud Ali Mohammadi.

Mohammadi, a university lecturer at Tehran University, was killed by a bomb on 12th January 2010, while leaving his home in Tehran.

Majid Jamali Fash, identified as the member of the “terrorist network” said he was trained by Israeli military in Tel Aviv. Speaking about his training, he said: “On a trip to Tel Aviv, I got acquainted with several senior Israeli officers in a base on a highway between Jerusalem and Tel Aviv. There, I learned different things such as tailing, stalking and planting bombs under vehicles."

Fash admitted to being briefed about Mohammadi and given “a very precise model of Dr Ali Mohammadi's house and its whereabouts” in order “to be very well acquainted with the real situation of his assassination.” He also said that he practiced bombing in a military base near Tel Aviv.

The Iranian authorities said that further information about "Mossad's infiltration as well as the dismantling of its espionage networks and the plotting of our prominent scientist's assassination will be gradually revealed in due time."

Mohammadi is not the only Iranian nuclear scientist to have been killing by a bomb attack. Another senior scientist involved in Iran's nuclear activities, Majid Shahriari, was killed by a car bomb, while Fereydoon Abbasi Davani, also a nuclear expert, was injured in a similar assassination attempt.

Sources: BBC News, AFP, The Palestine Telegraph

For more news and expert analysis about Iran, please see Iran Strategic Focus.

Iran cuts gasoline subsidies but its petrochemical industry is thriving

Iran's Oil Minister Massoud Mir-Kazemi said that Iran produced more than one billion litres of gasoline to meet domestic demands. Addressing the country's lawmakers on Tuesday 21st December, he said that Iran defied expectations of shortages.

“Today, the Oil Ministry's staff are implementing the targeted subsidiary plans … and should any problems arise, we will tackle them within the hour,” said Mir-Kazemi.

“This proposal, which places the most pressure on the Oil Ministry, is being gradually implemented,” explained Mir-Kazemi, referring to President Mahmoud Ahmadinejad's economic reform plans.

Part of the plan is phasing out national subsidies for fuel and food, which Iran began implementing on Sunday 19th December. Speaking about it on national television Ahmadinejad told Iran that the plan would lead to a better and more healthy economy, as domestic energy consumption would decrease making it possible to export the extra reserves.

Mir-Kazemi seconded Ahmadinejad's expectations by saying that higher prices would encourage people to use less fuel and cause less pollution, which is a serious problem in the country's capital Tehran.

Under the new plan, the price of gasoline has risen fourfold from 1,000 rials per liter to 4,000 rials, and fuel beyond a person's quota – which is 50 litres per month – now costs 7,000 rials per litre.

Last week, Mirkazemi said that Iran intends to increase gasoline production capacity by 10 million litres per day. It currently produced 45 litres per day, and is the second biggest crude oil producer in the Middle East.

In other related news, Iran's Deputy Oil Minister for Petrochemical Affairs Abdolhossein Bayat has said that Iran's petrochemical industries exported over 10million tonnes of product in the first 9 months of the current Iranian year [March 21-December 21].

"More than 10mln tons of petrochemical products have been exported since the beginning of the current year, which is 22% higher than the same period in last year," said Bayat said.

He also said the country's petrochemical industry was now worth $6.2 billion, which showed a 47 per cent growth compared with revenues of petrochemical exports last year.

"This year will see a 10.5-mln-ton increase in the production capacity because of a 5.2 billion dollar investment in the petrochemical sector," said Bayat.

Sources: PressTv, Fars News Agency, Upstream

For more news and expert analysis about Iran, please see Iran Strategic Focus.

Zubair field hits peak output target

Eni has said that production in Iraq's Zubair field has reached its peak output target of 1.2 million b/d. The field, which is already profitable, is divvied up between Missan Oil Company (25%), Eni (32.81%) Occidental Petroleum (23.44%) and Kogas (18.75%).

According to Eni output at Zubair has reached 201,000 b/d, showing a 9.8 per cent rise from when the service contract commenced on 18th February 2010. Zubair, one of the biggest oil fields in Iraq, is located near Basra in the south of the country.

"The consortium's contract cost recovery commences, with the group earning a remuneration fee of $2 per barrel on incremental production," said Eni in a statement.

For more news and expert analysis about Iraq, please see Iraq Focus.

© 2010 Menas Associates

Iran in talks with UN about its nuclear programme

Iran and key world powers have begun talks about Tehran's nuclear programme. On Sunday 5th November, Iran delivered its first raw uranium and said it would go into the discussions with “strength and power”.

The West fears that Iran may be gearing its programme for production of nuclear arms, however, Tehran maintains that its enrichment activities are purely for peaceful purposes. Speaking about the meeting in Geneva, Iran's nuclear chief, Ali Akbar Salehi, said the meeting was for the benefit of the other countries, not Iran.

"We want to create a graceful solution out of the political deadlock for those who have pressurised us," said Salehi.

Iran's main nuclear negotiator, Saeed Jalili, is meeting EU foreign affairs chief, Catherine Ashton, and senior officials from the five members of the UN Security Council – US, Russia, China, France, Britain – and Germany.

The talks, held near the Swiss mission to the UN, are expected to last two days. But experts say that Iran is unlikely to agree to suspend its enrichment programme as insisted on by the Security Council.

Iran's announcement in advance of the talks, that it is now able to produce its own yellowcake, crushed uranium ore which is turned into a gas for enrichment, has given it a new confidence that it can ride out sanctions.

The last talks, in October 2009, saw a breakthrough as Iran agreed to export low-enriched uranium for processing abroad but then stipulated new conditions and reneged on the deal. The UN Security Council has said that until Iran's intentions for its nuclear programme are clearly established, that it should cease its enrichment activities.

Iran is currently under four sets of UN sanctions due to its disregard for Security Council's calls to suspend its uranium enrichment. The latest sanctions, adopted on 9th June, include a ban on business with Iranian banks and insurance companies and steps to prevent foreign investment in the country's oil and gas sector.

Iran has countered Western fears by saying that as a signatory of the Nuclear Non-Proliferation Treaty, it has the right to enrich uranium for fuel utilised for civil nuclear power. Tensions over the nuclear issue reached their peak when one of Iran's top nuclear scientists was killed in a car bomb on Monday 29th November. Iran accused Western powers of masterminding the attack.

Enriched uranium can be used for fuel in reactors or made into nuclear bombs. Iran's announcement that it has produced its first domestically manufactured uranium yellowcake was no surprise according to White House National Security Council spokesman Mike Hammer.

"However... this calls into further question Iran's intentions and raises additional concerns at a time when Iran needs to address the concerns of the international community," he added.

Source: BBC News

For more news and expert analysis about Iran, please see Iran Strategic Focus.

Iran reports high gas output from South Pars field

Iran's Pars Oil and Gas Company (POGC) has said that South Pars gas field has produced in excess of 43 billion cubic metres of gas, in the first half of 2010.

"From September 23 to October 22, around 278 million cubic meters of rich gas has been produced in phase 2, 881 million in phase 3, 1,844 in phase 4 and 2,185 in phase 5 of the development project in south pars," said POGC spokesman Hossein Nosrat-Zadeha.

Speaking about the production numbers, Nosrat-Zadeh said that in the past seven months, 4.275 million cubic metres of gas were produced in phase 1 along with 193 million cubic metres in phases 2 and 3. The production volume in phases 4 and 5 has been registered at 11.734 billion cubic metres and 16.422 billion cubic metres of rich gas in phases 6, 7, 8 of South Pars project.

He added that production in phases 6, 7 and 8 in the one-year period starting April 2009 stood at 19.654 billion cubic metres. This is while in the five months left to the end of 2010, the figure stands at 16 billion and will run much higher by April 2011. Nosrat-Zadeha said that the planned opening of phases 15, 16, 17 and 18 in less than two years would elevate Iran's position as a major energy producer.

Source: Press TV

For more news and expert analysis about Iran, please see Iran Strategic Focus.

Iran's non-oil exports up by 20 per cent

Head of Iran's Trade Development Organisation Babak Afghahi has said that Iran's non-oil exports have risen 20 per cent above the forecast level in the first half of the Persian calendar year.

"Iran's non-oil exports have grown 30 per cent in the first half of the current [Persian calendar] year (March-September 2010)," said Afghahi. The target for this time period had been set at 10 per cent. The value of Iran's non-oil exports in 2010 now stands at $14.4 billion.

Speaking at a conference in the country's capita, Tehran, Afghahi said that Iran's exports of pistachio, carpet, mineral products and technical and engineering services have grown by 100, 44, 150 and 75 percent respectively.

The figures come while the International Monetary Fund and the World Bank forecast the exports growths of 8.2 per cent for developed countries and 10.5 per cent for developing nations.

Source: Press TV

For more news and expert analysis about Iran, please see Iran Strategic Focus.

Iran ready to set up economic bloc

Iran says it is ready to hold a meeting with the economy ministers of Syria, Iraq, and Turkey to discuss setting up an economic bloc in the region. Iran's Minister of Economic Affairs and Finance Shamseddin Hosseini made the remarks in a meeting with Syrian Economy and Trade Minister Lamia Assi in Tehran on 28th August.

Hosseini expressed hope that the neighbouring states would increase their economic ties in an effort to form a regional bloc in the Middle East, Mehr news agency reported. The minister added that Iranian and Syrian officials plan to discuss setting up a joint investment company and the expansion of banking and insurance cooperation within two months. Assi welcomed further economic ties with Iran.

The talks came as Tehran signed a draft agreement in mid-August on free trade with Syria. The Iranian minister said that under the agreement, all existing tariffs would be reduced to 4 per cent within five years, adding that the deal does not interfere with economic co-operation with other states.

For more news and expert analysis about Iran, please see Iran Strategic Focus.

© 2010 Menas Associates