U.S. – Iran Controversy Essay
So far, the U.S. trade embargo against Iran had been partial, in the sense that the U.S. companies were prevented from marketing Iranian oil directly in the U.S. markets. They were, however, allowed to resell Iranian oil in the world market. In fact, last year, this amounted to buying almost 20 percent Iranian crude oil valued at $3 billion to $4 billion. U.S. exports to Iran were valued at $326 million. Now given such a trade balance, which favoured the U.S.,’ the recent announcement (which becomes effective after July) will do more harm to the U.S. companies than to the authorities in Tehran. The cooperation of America’s major industrial allies within the G-7, especially Germany and Japan, to go along with the ban, appears to be the premise on which Mr. Clinton hopes to succeed. On this count too, the situation is far from encouraging. Despite pressure, the allies are not prepared to sacrifice their commercial interests. Japan has already expressed its reluctance. In fact, it appears that Tehran might upstage Washington in wooing Tokyo. In an amazing tactical shift, Iran has been seriously working to replace the U.S. dollar with the Japanese yen as the main currency Within the OPEC oil dealings. On the question of pressurising China and Russia _ other two important trade partners of Iran _ the Clinton administration is not making any progress. both countries have rejected the American logic. Russia, too, appears determined to go ahead with its nuclear-deals with Iran, which are perfectly legal and within the provisions of the NPT.
Mr. Clinton’s logic that trade embargo should be used as a pressure tactic to dissuade Iran from pursuing nuclear programmes, and sponsoring “International terrorism”, does not have many takers, except his own people and policy-makers. Even within the American foreign policy set-up, there is a division with the state department supporting the ban, and commerce and energy. departments opposing it. Mr.Clinton’s policy may not succeed, mostly because in an age of free global competition about which the U,S. itself has been trumpeting so much _ trade relations will be guided more by market conditions of demand and supply, than any fixed parabola about a particular national regime. The European and African companies may be even eagerly waitin~ to step in and upgrade their trade transactions with Iran. Not the least is~its impact on world oil supplied, which will increase the overall energy costs worldwide.