So much for that reset button or that sell out on the START treaty or that sell out on missile defense. Countering the new US embargo on petroleum and oil distillates embargo on Iran, Russian Energy Minister Sergei Shmatko and Iranian Oil Minister Masud Mir-Kazemi Wednesday, July 14 signed a series of far-reaching energy-related agreements, including a deal to sell Tehran Russian petroleum products and petrochemicals.

DEBKAfile

Countering the new US embargo on petroleum and oil distillates embargo on Iran, Russian Energy Minister Sergei Shmatko and Iranian Oil Minister Masud Mir-Kazemi Wednesday, July 14 signed a series of far-reaching energy-related agreements, including a deal to sell Tehran Russian petroleum products and petrochemicals.

debkafile’s Moscow sources report that the pacts aim squarely at the law signed by President Barack Obama on July 2 to hit Iran’s Revolutionary Guards Corps’ prime source of income, imported refined oil products including gasoline. The Russian and Iranian energy ministers contracted specifically to “increase cooperation in transit, swaps and marketing of natural gas as well as sales of petroleum products and petrochemicals.”
The accords also set up “a joint bank to help fund bilateral energy projects.”

This latter provision bypasses the US ban on the banks and insurance companies involved in funding refined oil supplies to Iran by creating a shared banking instrument for handling the funding of fuel purchases. Russian insurance firms connected with the new joint bank may insure shipments.
By this step, Moscow moved to offset the penalties America imposed on Iran in the wake of UN Security Council sanctions of June 9 and challenged the United States to blacklist Russian firms by invoking the new US law closing American markets to companies and banks doing energy business with Iran.

Important multinationals have already complied with this US edict, including two oil giants, the American-British BP and the French Total – which have ordered their vast networks of partners and subsidiaries to deny fuel to Iranian consumers – and Lloyds insurance as well as the United Arab Emirates.

But punishing Russian breakers of the US sanction could trigger a serious crisis in relations with Russia.
Sources on Moscow do not believe Obama will find upsetting his newly “reset” ties with Russian President Dmitry Medvedev and Russian Prime Minister Vladimir Putin worth the candle, especially in the light of the new joint mechanisms and bank for conducting their business.

FULL STORY

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