GOP Senators Propose Full Embargo on Iran

After gradually tightening the noose on Iran’s economy for the past three years, some in Congress now believe the time has come to enforce an all-out trade embargo on the regime in Tehran to finally force it to give up its nuclear program.

Republican Sens. Mark S. Kirk of Illinois and John Cornyn of Texas unveiled legislation Tuesday evening that would sanction any individual or company that imports, purchases or transfers goods or services from the government of Iran or any entity affiliated with it.

That sort of blanket ban goes beyond what any in Congress have proposed up to this point. Past sanctions legislation has targeted certain industries and economic sectors, particularly in energy and finance. Under existing U. S. law (PL 112-81), foreign companies are allowed to continue to purchase crude oil from Iran if they demonstrate that they have made significant reductions in those purchases over time.

This bill would wipe out that provision and, with it, the delicate diplomatic balance that the Obama administration has tried to strike with foreign countries, encouraging them to reduce their trade with Iran in exchange for sanctions relief.

A bipartisan House bill (HR 850) that the Foreign Affairs Committee is marking up Wednesday proposes a similar approach to Iran’s trade in crude oil, the regime’s main source of revenue.

An updated draft unveiled Tuesday includes a provision that would require those countries currently purchasing crude oil from Iran to reduce their imports, in the aggregate, by a total of 1 million barrels per day within the next year. Iran sells roughly 1 million barrels of oil each day, so, in effect, the legislation would create an oil embargo.

But the bill, sponsored by Foreign Affairs Committee Chairman Ed Royce, R-Calif. , and Eliot L. Engel, D-N. Y. , does not extend the ban to all forms of trade or financial exchanges, as Kirk and Cornyn propose in the Senate. Instead, it expands the sector-based approach, blacklisting the automotive and mining sectors and requiring the White House to investigate whether the construction and engineering sectors should be blacklisted as well.

All that may be too far for Congress to go at this point. It’s telling that the Kirk and Cornyn bill is not bipartisan, as past rounds of tough sanctions laws have been.

Senate Foreign Relations Committee Chairman Robert Menendez, D-N. J, Kirk’s partner on many of the previous bills, warned last week that such an approach would risk fracturing the international coalition that has come together to pressure Iran both diplomatically and economically.

“I think we can do more on seeking reductions, more significant reductions in the oil purchases of countries, and we can do that under the regime that we have already largely pursued and have had support for,” Menendez said in an interview last week.

Menendez is expected to introduce his own bill to that effect in the coming weeks.

Even Brad Sherman, D-Calif. , one of the Hill’s most vocal backers of sanctions, last week sounded a hesitant note about imposing an oil embargo on Iran.

“I think the oil markets can handle it right now. I think I’d favor that,” Sherman said. But he added that the point is not to have the toughest U. S. sanctions but rather “the toughest worldwide sanctions. ”

And sometimes, he said, that means “backing off a little bit” on extraterritorial sanctions: those applied by the U. S. government against foreign firms.

Sherman and others on the Foreign Affairs Committee have a long list of amendments prepared for the panel’s Wednesday markup, many of which are focused on forcing the Obama administration to enforce existing sanctions laws more aggressively.

Rep. Jeff Duncan, R-S. C. , plans to introduce an amendment that requires the president to report every 90 days on any decisions his administration has made not to impose sanctions on companies trading in gold with Tehran, which is banned under existing law. Rep. Ileana Ros-Lehtinen, R-Fla. , has an amendment that would eliminate the president’s ability to waive sanctions related to Iran’s nuclear proliferation.

In addition to the new de facto oil embargo, Royce and Engel’s updated draft, released Tuesday, includes new language to close loopholes that the Iranian government has devised to ship and offload its oil and to cut off Iran’s access to foreign currency, echoing a piece of legislation (S 892) that Kirk and Sen. Joe Manchin III, D-W. Va. , introduced earlier this month.

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