Wednesday, July 21, 2010

New Sanctions Against Iran Having Effect

Despite some predictions to the contrary, the latest round of sanctions against Iran adopted by the United Nations and the United States appear to be having a significant effect on Iran's ability to ship critical goods into and out of the country.  According to a Washington Post article today, many international insurance companies are refusing to insure Iranian shippers for fear of running afoul of the sanctions.  The new sanctions have also led fuel suppliers in Europe and the Middle East to refuse to refuel Iranian planes. Of particular note, the preemient maritime insurer Lloyd's has stated that it will no longer underwrite gasoline shipments to Iran. Without insurance to cover possible damages, most ports will refuse entry to Iranian ships.  The Iranian government has proposed a possible solution by underwriting the insurance itself, but it is not clear whether there are sufficient resources available and whether this suggestion will be an acceptable resolution.

On a related note of concern to those in university communities, the Washington Post reports that the U.S.-based Educational Testing Service has stopped registration for its tests in Iran because the U.S. sanctions prevent it from accepting payments from that country. The company's Test of English as a Foreign Language is required for acceptance to many universities worldwide, and the move could significantly hinder the ability of Iranians to study abroad.

In retaliation for the sanctions, Iran's parliament passed a bill calling for cargo inspections of any ship from a country that inspects Iranian vessels under the sanctions. Such a move could seriously delay or impede international shipping traffic through the Strait of Hormuz.

The U.S. sanctions are broader than those imposed by the U.N.  Russia, India and China have protested U.S. attempts to impose its laws on their countries and citizens.  Things may get evern tougher for Iran soon, however, as the European Union is expected to impose its own more stringent sanctions in the near future.


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