World prepares for US sanctions on Iran

Iranians monitor the stock market at the stock exchange in Tehran on May 8, 2018. Renewed nuclear sanctions would certainly cause severe problems for Iran's economy, but much of the damage has already been done by the uncertainty created by the US and myriad home-grown problems. (AFP / ATTA KENARE)
Updated 12 May 2018
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World prepares for US sanctions on Iran

  • Global shipping companies, traders, insurers and banks look at pulling the plug on business with Tehran after Donald Trump’s decision to reimpose sanctions on Iran.
  • Reuters cites sources at global trading companies predicting an imminent drop in Iranian exports due to banking issues, such as availability of trade finance.

LONDON:  US President Donald Trump’s decision to reimpose sanctions on Iran is forcing global shipping companies, traders, insurers and banks to look at pulling the plug on business with Tehran, it emerged yesterday.

Swiss-headquartered private shipping group MSC said it would “comply with the (sanctions) timetable set out by the US government.”

Denmark’s Maersk Line said it had ceased acceptance of the specific cargoes blacklisted by the US Treasury this week.

On May 9, President Donald Trump broke with his European allies to announce US withdrawal from the international nuclear agreement with Tehran brokered by President Obama. Trump disclosed a phased reimposition of punitive sanctions, which will further damage an already weakened Iranian economy.

Among other things, Washington is imposing sanctions on the direct or indirect sale, supply, or transfer to or from Iran of graphite and raw or semi-finished metals such as aluminium and steel, and coal, Reuters reported. The US will separately re-impose sanctions on the provision of insurance and reinsurance.

Reuters cited sources at global trading companies predicting an imminent drop in Iranian exports due to banking issues, such as availability of trade finance.

A potential decline in oil volumes due to the sanctions could add to upward pressure on oil prices, which have gained almost 20 percent to around $78 per barrel since January. 

The price rise has also been bolstered by a decision by OPEC and Russia to cap production to reduce inventories that had built up during the boom that came to a halt in 2014.

Middle Eastern oil-producing countries have benefited this year from rising oil revenues, giving them headroom to increase spending to stimulate economies that faced austerity in the wake of the collapse of the crude price four years ago. 

Saudi Arabia’s first-quarter statement revealed increased government spending and a jump in central government receipts from new taxes, including VAT.


Calm in Hodeidah as observers move in to monitor cease-fire

Sporadic clashes continued until about 3 a.m. on Tuesday, but residents said there was calm after that. (AFP)
Updated 19 December 2018
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Calm in Hodeidah as observers move in to monitor cease-fire

  • “Both parties said publicly they are abiding by the cease-fire,” a UN official said
  • The truce in Hodeidah officially began at midnight on Monday

JEDDAH: Truce monitoring observers will be deployed in the Red Sea port city of Hodeidah on Wednesday as the first 24 hours of a UN-brokered cease-fire passed without incident.

The Redeployment Coordination Committee comprises members of the Yemeni government supported by the Saudi-led coalition, and Houthi militias backed by Iran, and is overseen by the UN. 

The head of the committee will report to the UN Security Council every week.

Deployment of the observers is the latest stage in a peace deal reached after talks last week in Sweden. Both sides in the conflict agreed to a cease-fire in Hodeidah and the withdrawal of their forces within 21 days.

“Both parties said publicly they are abiding by the cease-fire,” a UN official said on Tuesday.

Local authorities and police will run the city and its three port facilities under UN supervision, and the two sides are barred from bringing in reinforcements.

UN envoy Martin Griffith said the committee was expected to start its work swiftly “to translate the momentum built up in Sweden into achievements on the ground.”

The truce in Hodeidah officially began at midnight on Monday. Sporadic clashes continued until about 3 a.m. on Tuesday, but residents said there was calm after that. 

“We are hopeful that things will go back to the way they were and that there will be no aggression, no airstrikes and lasting security,” said one, Amani Mohammed.

Another resident, Mohammed Al-Saikel, said he was optimistic the cease-fire would pave the way for a broader truce. “We are hopeful about this cease-fire in Hodeidah and one for Yemen in general,” he said. “We will reach out in peace to whoever does the same.”

The UN Security Council is considering a draft resolution that asks Secretary-General Antonio Guterres to submit proposals by the end of the month on how to monitor the cease-fire.

The resolution, submitted by the UK, “calls on all parties to the conflict to take further steps to facilitate the unhindered flow of commercial and humanitarian supplies including food, fuel, medicine and other essential imports and humanitarian personnel into and across the country.”