EU, Iran set financial vehicle

UNITED NATIONS, Sept 25, (Agencies): The remaining parties to the Iran nuclear deal on Monday agreed to keep working to maintain trade with Tehran despite skepticism this is possible as US sanctions to choke off Iranian oil sales resume in November.

US President Donald Trump decided in May to abandon the pact and to restore economic sanctions on Iran, including those that seek to force the OPEC member’s major oil customers to stop buying Iranian crude.

In a statement after a meeting of Britain, China, France, Germany, Russia and Iran, the group said they were determined to develop payment mechanisms to continue trade with Iran despite skepticism by many diplomats that this will be possible.

“Mindful of the urgency and the need for tangible results, the participants welcomed practical proposals to maintain and develop payment channels notably the initiative to establish a Special Purpose Vehicle (SPV) to facilitate payments related to Iran’s exports, including oil,” the group said in a joint statement issued after the statement.

Several European diplomats said the SPV idea was to create a barter system, similar to one used by the Soviet Union during the Cold War, to exchange Iranian oil for European goods without money changing hands.

The idea is to circumvent US sanctions due to be restored in November under which Washington can cut off from the US financial system any bank that facilitates an oil transaction with Iran.

Speaking to reporters after the meeting, European Union foreign policy chief Federica Mogherini said the decision to set up such a vehicle had already been taken and that technical experts would meet again to flesh out the details.

“In practical terms this will mean that EU member states will set up a legal entity to facilitate legitimate financial transactions with Iran and this will allow European companies to

continue to trade with Iran in accordance with European Union law and could be open to other partners in the world,” she said.

Many diplomats and analysts, however, are skeptical such a vehicle could ultimately thwart US sanctions given that the United States could amend its sanctions laws to prohibit such barter transactions.

“The key is to keep all possibilities open so that we can signal to the Iranians that the door isn’t closing,” said a senior French diplomat.

The European Union, has so far failed to devise a workable legal framework to shield its companies from US sanctions that go into effect in November and that, among other things, seek to choke off Iran’s oil sales, diplomats said.

Highlighting how difficult it will be for the Europeans to come up with concrete solutions, French state-owned bank Bpifrance on Monday abandoned a plan to set up a financial mechanism to aid French firms trading with Iran.

The crux of the 2015 nuclear deal, negotiated over almost two years by the administration of former US president Barack Obama, was that Iran would restrain its nuclear program in return for the relaxation of sanctions that had crippled its economy.

Trump considered it flawed because it did not include curbs on Iran’s ballistic missiles program or its support for proxies in Syria, Yemen, Lebanon and Iraq.

The impending return of US sanctions has contributed to a slide in Iran’s currency. The rial has lost about twothirds of its value this year, hitting a record low against the US dollar this month.

Deadly attack

Iran on Tuesday identified the perpetrators of a deadly attack on a military parade as “jihadist separatists”, announcing a series of arrests and appearing to tie the Islamic State group to the bloodshed.

The intelligence ministry published photos of the five men it said carried out the assault Saturday in the southwestern city of Ahvaz that killed 24 people including a four-year-old child and other civilians.

“The five members of a terrorist squad affiliated to jihadist separatist groups supported by Arab reactionary countries were identified,” the ministry said in a statement.

“The terrorists’ hideout was found and 22 people involved (in the attack) were arrested,” it said, adding that explosives were seized along with military and communications equipment.

The attack targeted a parade in Khuzestan province commemorating the 1980-1988 Iran-Iraq war.

The border region, which has a large ethnic Arab community, was a major battleground of the conflict and saw ethnic unrest in 2005 and 2011.

Iranian officials initially blamed Arab separatists, who they claimed were behind previous unrest, for the latest attack, saying they were backed by Gulf Arab allies of the United States.

This version was bolstered when a movement called “Ahwaz National Resistance”, an Arab separatist group, claimed responsibility shortly after the assault.

But the Islamic State group (IS) was also quick to claim responsibility and later posted a video of men it said were the attackers.

Iran’s supreme leader, Ayatollah Ali Khamenei, on Monday linked the attackers to Iraq and Syria, where IS once had major strongholds.

“This cowardly act was the work of those very individuals who are rescued by the Americans whenever they are in trouble in Iraq and Syria and who are funded by the Saudis and the (United) Arab Emirates,” Khamenei was quoted as saying by his official website.

Iranian authorities have accused the United States, Israel, Saudi Arabia and United Arab Emirates (UAE) of being behind the Ahvaz attack.

Both Riyadh and Abu Dhabi denied any involvement.

Saudi Arabia “completely rejects the deplorable false accusations by Iranian officials regarding the kingdom’s support for the incidents that occurred in Iran,” a Saudi foreign ministry official said Tuesday.

The UAE’s minister of state for foreign affairs, Anwar Gargash, has also dismissed Iran’s accusation as “baseless”.

“This official campaign launched in Iran against the UAE is regrettable and has escalated since the Ahvaz attack,” Gargash tweeted earlier this week.

The photographs of the alleged attackers released by the authorities Tuesday showed the bodies of four men named as Ayyad Mansouri, Fouad Mansouri, Ahmad Mansouri and Javad Saari.

The picture published by the intelligence ministry of an alleged fifth member of the group, Hassan Darvishi, was a screenshot taken from the video put out by IS.

According to local media two of the Mansouris are brothers and the third is their cousin.

Abdullah Ganji, the managing director of the ultra-conservative Javan daily, wrote on Twitter that a Mansouri brother “was killed in a suicide bombing in Syria”.

There has been no known presence of Iranian Arab separatist groups in Syria.

Ganji also wrote in an article that the nature of the attack in Ahvaz, in which the assailants died, far more resembled IS than the “bombing or hit and run operations” typical of Arab separatist groups.

“To kill until you are killed, without trying to leave the scene is the method of (IS),” he said, pointing to parallels with a high-profile attack in Iran last year.

On June 7, 2017, in Tehran, 17 people were killed and dozens wounded in simultaneous attacks on the parliament and on the tomb of revolutionary leader Ayatollah Ruhollah Khomeini – the first inside Iran claimed by IS.

An Iranian media outlet close to the hard-line Revolutionary Guard published a video Tuesday threatening missile attacks on the capitals of Saudi Arabia and the United Arab Emirates, further raising tensions after a weekend militant attack on an Iranian military parade.

The video, in a tweet by the semiofficial Fars news agency that was later deleted, comes as Iran’s Supreme Leader Ayatollah Ali Khamenei blamed Riyadh and Abu Dhabi for the attack in the city of Ahvaz on Saturday, which killed at least 24 people and wounded over 60. Saudi Arabia adamantly rejected the allegations.

The threat amplifies the unease felt across the Persian Gulf, as Iran’s economy reels in the wake of America’s withdrawal from the 2015 nuclear deal and Saudi and Emirati forces are bogged down in their war against Iranaligned rebels in Yemen.

The Fars video showed file footage of previous ballistic missiles launched by the Guard, then a graphic of a sniper rifle scope trained on Abu Dhabi in the United Arab Emirates and Riyadh in Saudi Arabia. The video also threatened Israel.

“The era of the hit-and-run has expired,” Khamenei is heard saying in the video, a clip from an April speech by the supreme leader. “A heavy punishment is underway.”

Fars did not say why it took the video down. However, it came just before President Hassan Rouhani was to address the UN General Assembly later in the day.

Iran has launched two ballistic missile attacks in recent years. In 2017, responding to an Islamic State attack on Tehran, the Guard fired missiles striking IS targets in Syria. Earlier this month, Iran launched a strike on a meeting of Iranian Kurdish separatists in northern Iraq.

The Guard, a paramilitary force answerable only to Khamenei, has sole control over Iran’s ballistic missile program.

Iran’s elite Revolutionary Guards called Trump “evil and adventurous” on Tuesday and accused him of waging economic war, as Washington’s reimposed sanctions ramped up pressure on Tehran’s economy

The Revolutionary Guards’ rebuke came hours before Trump and Iran’s moderate President Hassan Rouhani were both due to attend a UN General Assembly meeting in New York. Rouhani has come under increasing pressure from hardliners since Trump’s actions.