Many believe weak European economies will falter further if they bow to US pressure and spurn Iran oil.
Iran has accused the European Union of waging “psychological warfare” after the bloc banned imports of Iranian oil over Tehran’s controversial nuclear programme.
The oil ban, which was approved at a meeting in Brussels on Monday, along with sanctions against Iran’s central bank and other measures, came as Western powers stepped up pressure on Iran to return to negotiations amid concerns that it is moving closer to building nuclear weapons.
Al Jazeera talks to Iranian writer and journalist Hooman Majd about the EU oil embargo on Iran
“The method of threat, pressure and unfair sanctions against a nation that has a strong reason for its approach is doomed to fail,” Ramin Mehmanparast, Iran’s foreign ministry spokesman, told the state broadcaster.
“European Union sanctions on Iranian oil is psychological warfare,” Mehmanparast said. “Imposing economic sanctions is illogical and unfair but will not stop our nation from obtaining its rights.”
Iran’s oil ministry issued a statement saying the sanctions did not come as a shock. “The oil ministry has from long ago thought about it and has come up with measures to deal with any challenges,” it said, according to the IRNA news agency.
Mehmanparast said: “The European countries and those who are under American pressure, should think about their own interests. Any country that deprives itself from Iran’s energy market, will soon see that it has been replaced by others.”
Washington welcomes sanctions
Catherine Ashton, the EU foreign policy chief, said that global powers involved in negotiations on Iran’s nuclear programme were still waiting for Tehran to resume talks stalled since January last year.
“The pressure of sanctions is designed to try and make sure that Iran takes seriously our request to come to the table,” she said.
The EU action was welcomed in Washington where US President Barack Obama said officials would impose more sanctions to address the “serious threat presented by Iran’s nuclear programme.”
Washington also announced new sanctions against Iran’s third largest state-owned bank, Bank Tejarat, and the Trade Capital Bank, an affiliate. Both are still accessing the international financial system.
Under Monday’s embargo decision, all new contracts for crude oil and petroleum products between Iran and any of the EU’s 27 member states, will be forbidden. Existing contracts have to be suspended by the end of June.
There will be a review of the embargo on May 1, a month before all oil contracts cease.
The EU is the second biggest importer of Iranian oil, after China, while the US banned imports in 1979 [Al Jazeera]
Al Jazeera’s Nick Spicer, reporting from the sidelines of the meeting in Brussels, said: “The reason for that is so that countries heavily dependent on Iranian oil, namely Greece, Italy and Spain, some of the most ailing members of the eurozone, can find new sources of supply, and secondly, to see what steps Iran is taking to come back to the negotiating table.”
Describing the EU measures as part of “an unprecedented set of sanctions”, William Hague, the British foreign minister, said: “Today’s sanctions show how serious EU member states are about preventing nuclear proliferation and pressing Iran to return to the negotiating table,” he said.
France, Britain and Germany said, just hours after the decision on Monday, that they were willing to negotiate with Iran if it was ready to talk seriously about its nuclear programme.
“We call on Iran’s leadership immediately to suspend its sensitive nuclear activities and abide fully by its international obligations,” the three countries said in a joint statement by their leaders.
The UN’s International Atomic Energy Agency (IAEA) also confirmed on Monday that a high-level visit to Iran would take place from January 29-31 for talks on Tehran’s nuclear activities.
Western countries believe Iran’s uranium enrichment programme is part of an effort to build a nuclear bomb, but Iran says the programme is to generate electricity.
Nick Spicer reports on the meeting from Brussels
Issues of concern before Monday’s meeting included the impact and costs of the ban for countries such as Greece, which relies on financial help from the EU and the International Monetary Fund to stay afloat, and received Iranian crude on preferential financing terms.
A diplomatic push is under way, officials say, to secure supplies from other producers. Saudi Arabia, the world’s top producer, said this month it would increase production by about two million barrels per day.
The effort to take Iran’s 2.6 million barrels of oil per day off international markets has kept global prices high, pushed down Iran’s rial currency and is causing a surge in the cost of basic goods for Iranians.
Al Jazeera’s Dorsa Jabbari, reporting from Tehran, said the Iranian government believed that the EU sanctions would not really affect their oil revenues, with rising oil prices making up for a loss of revenues.
Our correspondent said the impact of the sanctions would be felt by ordinary Iranians by increasing the price of the US dollar against the Iranian rial, she said, noting that the dollar rose by about 10 cents after the EU sanctions announcement.
Speaking to Al Jazeera, Sadegh Zibakalam, a professor of political science at Tehran University, said that EU sanctions would not “terribly affect” Iran.
“The real problem for Iran comes [from] Asia and not from Europe,” Zibakalam said. “That is to say if China, South Korea, Japan … and India move towards … reducing their oil from Iran, that will create a serious problem for Iran.”
The four Asian nations purchase about 59 per cent of Iran’s oil each year, while EU countries account for 18 per cent.