U.S. imposes sanctions on Iran's petrochemical industry

By Timothy Gardner

WASHINGTON (Reuters) - The United States blacklisted on Friday eight companies in Iran's petrochemical industry, sending a warning to the Islamic Republic's global customers as Washington strives to cut off funds to the country's nuclear program.

Petrochemical companies owned or controlled by the Iranian government that are on the Treasury Department list include Bandar Imam Petrochemical Co, Bou Ali Sina Petrochemical Co and Mobin Petrochemical Co.

This was the first time Washington sanctioned the petrochemical industry, which an administration official said was the largest source of foreign earnings for Iran's nuclear program after oil sales.

"Companies should end immediately their purchases of Iranian petrochemical products," the official, who spoke on condition of anonymity, said on a call with reporters.

He said U.S. officials over the last several months had been engaged in a "strong diplomatic campaign" with governments and companies around the world to make clear that sanctions could be imposed on purchases of Iran's petrochemicals.

In a related action, the U.S. State Department imposed sanctions on Niksima Food and Beverage JLT, a frozen yogurt company based in the UAE, for "knowingly engaging" in a transaction for the purchase of petrochemical products from Iran. It also sanctioned Jam, an Iranian manufacturer and seller of petrochemicals. The sanctions effectively cut them off from the U.S. financial system.

Niksima did not immediately reply to a request for comment.

Western powers believe Iran is trying to develop the ability to make nuclear weapons. Tehran has said the program is purely for generating power and for medical devices.

Sanctions imposed by the United States and European Union halved Iran's oil exports last year, depriving the government of billions of dollars in revenue, increasing already high inflation and pushing down the value of its currency, the rial.

There is little evidence that the sanctions have slowed the nuclear program ahead of a presidential election in Iran scheduled for next month.

Secretary of State John Kerry said on Friday he did not have high expectations that the election would change the calculus over Tehran's nuclear program, and he repeated that it was unacceptable for Iran to have a nuclear weapon.

The Treasury Department also on Friday imposed sanctions on Ferland Company Limited, which is based in Cyprus and Ukraine. The U.S. administration believes Ferland helped the National Iranian Tanker Company (NITC) evade oil sanctions.

Ferland did not have an immediate comment.

The Treasury Department said that on March 13 Ferland and the NITC cooperated in a scheme involving a vessel controlled by Dimitris Cambis to sell Iranian crude oil and evade Western sanctions. In March, Washington sanctioned Cambis, a Greek businessman, and said he had secretly operated a shipping network on behalf of Iran to circumvent sanctions.

Critics of the U.S. sanctions have said they harden Tehran's resolve to continue its nuclear program.

(Reporting by Timothy Gardner; Editing by Toni Reinhold)

Source: http://news.yahoo.com/u-imposes-sanctions-irans-petrochemical-industry-181511459.html

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