Archive for the ‘Iran’ Category

US Can’t Touch Iran’s Warships Even If They’re Violating Venezuelan Sanctions – Foreign Policy

Last week, Politico reported the movement of two Iranian warships apparently on their way to the Atlantic Ocean. U.S. national security officials expressed concern that these ships were bound for Venezuela with cargoes that violate U.S. sanctions on Caracas. Already, Sen. Marco Rubio has called for the United States to prevent the ships arrival. However, any U.S. action against these vessels would be unlawful and undermine a core tenet of the international order: sovereign immunity. The costs of direct action would be severe, exposing the United States to charges of hypocrisy toward the rules-based order and potentially opening U.S. naval vessels to similar treatment by adversaries.

Caracas and Tehran have grown close over the past decade as each has found relief in the other as a safety valve from U.S. sanctions. Trade in oil has been particularly important for the duo, and the United States and its allies have, in recent years, interdicted several cargo vessels under flags of convenience suspected of ferrying Iranian oil in violation of U.S. and European Union sanctions. This time is different. These vessels are part of the Iranian navy. Under international law, Tehran can channel rapper MC Hammer and tell the United States, you cant touch this.

Last week, Politico reported the movement of two Iranian warships apparently on their way to the Atlantic Ocean. U.S. national security officials expressed concern that these ships were bound for Venezuela with cargoes that violate U.S. sanctions on Caracas. Already, Sen. Marco Rubio has called for the United States to prevent the ships arrival. However, any U.S. action against these vessels would be unlawful and undermine a core tenet of the international order: sovereign immunity. The costs of direct action would be severe, exposing the United States to charges of hypocrisy toward the rules-based order and potentially opening U.S. naval vessels to similar treatment by adversaries.

Caracas and Tehran have grown close over the past decade as each has found relief in the other as a safety valve from U.S. sanctions. Trade in oil has been particularly important for the duo, and the United States and its allies have, in recent years, interdicted several cargo vessels under flags of convenience suspected of ferrying Iranian oil in violation of U.S. and European Union sanctions. This time is different. These vessels are part of the Iranian navy. Under international law, Tehran can channel rapper MC Hammer and tell the United States, you cant touch this.

The law of the sea, whether customary or conventional, grants warships and other government ships sovereign immunity. In times of peace, sovereign immunity is a practically all-powerful ward against a foreign states jurisdiction. Exceptions may apply in extreme circumstances involving failed states, fake warships, or weapons of mass destruction.This case, however, is textbook.

The U.N. Convention on the Law of the Sea (UNCLOS) defines warships as vessels belonging to the armed forces under the command of an officer in the service list and manned by a crew in good order.Both Iranian vessels, an unnamed frigate and the IRINS Makran, both clearly meet the definition of a warship under the U.N. convention.

The U.N. Convention, which the United States believes reflects customary international law, explicitly spells out some of sovereign immunitys power. And on the high seas, sovereign immunity is absolute. Article 95 simply reads: Warships on the high seas have complete immunity from the jurisdiction of any State other than the flag State. Article 96 provides the same absolute immunity to government-owned or operated vessels on the high seas. This right also applies in exclusive economic zones (EEZ) since nothing in that section overrules the provisions.

Even in the territorial sea, sovereign immunity remains a powerful protection. Warships enjoy the right of innocent passage in foreign territorial seas. The coastal state may establish rules for navigational safety but has essentially no power to enforce these regulations on foreign warships that flout traffic separation schemes or the like. As long as the warship is engaged in innocent passage, not threatening the coastal state, the coastal state can, at most, order the warship to leave the territorial sea. Interdiction or arrest are out of the question unless the warship threatens the coastal state, at which point self-defense would be permitted.

Internal waters, such as ports, are not substantially different. A warship would, of course, need the coastal states permission to enter internal waters. Yet even here, where the coastal state has its greatest authority, sovereign immunity retains its power under well-accepted, customary international law. The International Tribunal for the Law of the Sea (ITLOS) affirmed this in 2012s ARA Libertad case. The Libertad is an Argentinian naval vessel that called at Tema, a Ghanaian port, in late 2012. As part of enforcing a U.S. court order over unpaid Argentine sovereign debts, Ghanaian courts ordered the vessel to remain in the harbor, and Ghanaian authorities attempted to board the vessel. In December 2012, ITLOSs judges unanimously ordered Ghana to release the vessel immediately. The majority reasoning noted a warship is an expression of the sovereignty of its flag state and in accordance with general international law, a warship enjoys immunity, including in internal waters.

ITLOS judges Rdiger Wolfrum and Jean-Pierre Cot built an even more robust argument in their concurring opinion. There, they took issue with the majoritys summary reasoning and instead closely examined both proposals relating to internal waters and warships prior to UNCLOS and the language of that convention itself. They ultimately concluded that warships in internal waters enjoy immunity from the exercise of coastal state jurisdiction, which includes immunity from judicial proceedings or any enforcement measure, [and] is well established in customary international law. This principle, the judges noted, was recognized not only by the Institut de Droit International as early as 1898 and again in 1928 but also by various national court cases, including the U.S. Supreme Courts Schooner Exchange v. McFaddon and Others.

Nothing changes even if U.S. officials ascertain the vessels are carrying conventional arms that violate U.S. sanctions on Caracas. Consider U.N. Security Council-endorsed sanctions on North Korea. That system includes perhaps the most robust system of sanctions on ship-borne materials and comes with the backing of the five permanent Security Council members (even if Chinas enforcement has been lukewarm). Although silent on sovereign immune vessels, the most recent resolution in 2017 allowed member states to seize, inspect, and freeze any vessel subject to its jurisdiction in its territorial waters. Since customary international law holds that warships during peacetime are never under the jurisdiction of a foreign state, foreign warships are arguably not subject to foreign enforcement actions under these U.N. sanctions.

In this case, so long as the Iranian warships do not threaten use of force, sovereign immunity protects them wherever they arewhether in the high seas, an EEZ, a territorial sea, or internal waters. If conventional arms are aboard, the U.S. enforcement action would merely rest on national sanctions while even the most robust U.N. sanctions may not cover sovereign immune vessels. Likewise, the ARA Libertad precedent clearly demonstrates even if these vessels are forced to request and receive permission to call at a port to replenish their supplies, the United States gains no legal options. The port state remains bound by customary international law.

The United States could ignore the law, as Iran does in the Persian Gulf, but this comes with significant costs. If an attempted enforcement action leads to a U.S. loss before an international court, the United States suffers a humiliating defeat that may embolden Iran. If the enforcement action succeeds both operationally and legally, the United States could put U.S. naval vessels at jeopardy, if, say, China decided U.S. naval vessels supplying arms to Taiwan violated future Chinese sanctions.

A success or failure, U.S. action directly against the Iranian vessels steaming across the Atlantic Ocean will complicate efforts to secure U.S. interests and position the United States as a champion of the international rules-based order. To prevent Irans naval vessels from reaching Venezuela and to advance U.S. interests, the United States should employ diplomacy rather than force and encourage states along the route to deny the Iranian vessels port access if requested. But policymakers and elected officials itching to send in the U.S. Navy or Coast Guard would do well to remember MC Hammers basic rule of sovereign immunity: You cant touch this.

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US Can't Touch Iran's Warships Even If They're Violating Venezuelan Sanctions - Foreign Policy

Irans Misery and the Miserable State of the Iranian Rial – National Review

A money changer holds Iranian rial banknotes as he waits for customers in Tehrans business district in 2012.(Raheb Homavandi/Reuters)

As Iran heads to a presidential election on June 18, its economy is a shambles. Theres a partial solution -- if its rulers are interested.

With Irans upcoming presidential election on June 18, its time to determine whether Iranians are miserable or happy. After all, the publics state of mind always colors public opinion. In the economic sphere, misery tends to flow from high inflation, steep borrowing costs, and unemployment. The surefire way to mitigate that misery is through economic growth. All else being equal, happiness tends to blossom when growth is strong, inflation and interest rates are low, and jobs are plentiful.

Many countries measure and report these economic metrics regularly, and comparing them, nation by nation, can tell quite a bit about the state of important global economic sentiments. Is Iran, for example, more or less miserable than other countries? Hankes Annual Misery Index (HAMI) gives us the answers.

The first misery index was constructed by economist Arthur Okun in the 1960s to provide President Lyndon Johnson with an easily digestible snapshot of the U.S. economy That original misery index was a simple sum of a nations annual inflation rate and its unemployment rate. The index itself has been modified several times, and its coverage has been greatly expanded, first by Robert Barro of Harvard, and then by me.

My modified misery index is the sum of the unemployment, inflation, and banklending rates, minus the percentage change in real GDP per capita. Higher readings on the first three elements are bad and make people more miserable. These bad measurements are offset by a good (real GDP per capita growth), which is subtracted from the sum of the bads. A higher HAMI score reflects a higher level of misery.

Where, then, does Iran rank? Of the worlds 156 countries that I cover in the HAMI, Iran ranks as the eighth-most miserable country in the world, behind Venezuela, Zimbabwe, Sudan, Lebanon, Suriname, Libya, and Argentina.

The symptoms of Irans misery are as clear as the nose on your face. Since January 2020, the Iranian rial has lost 45 percent of its value against the U.S. dollar. As shown in the table below, there are only seven countries whose currencies have lost more than Irans.

The rials weakness has led to inflation being an endemic problem in Iran. Every day I accurately measure the inflation rate and, today, by my measure, the inflation rate is an intolerable 40 percent per year.

The best option to bring an end to Irans misery is a currency board. A currency board issues notes and coins convertible on demand into a foreign anchor currency at a fixed rate of exchange. It is required to hold anchor-currency reserves equal to 100 percent of its monetary liabilities.

A currency board has no discretionary monetary powers and cannot issue credit. It has an exchange-rate policy but no monetary policy, and its sole function is to exchange the domestic currency it issues for an anchor currency at a fixed rate. A currency boards currency is a clone of its anchor currency.

Whats more, it requires no preconditions and can be installed rapidly. Government finances, state-owned enterprises, and trade need not be reformed before a currency board can issue money. They have existed in some 70 countries since 1849. None have failed.

As the one who designed the currency boards in Estonia (1992), Lithuania (1994), Bulgaria (1997), and Bosnia-Herzegovina (1997), I can attest to the fact that they work perfectly to create stability. And while stability might not be everything, everything is nothing without it.

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Irans Misery and the Miserable State of the Iranian Rial - National Review

Oil hits two-year high as doubts gather over Irans market return – Al Jazeera English

Brent futures hit their highest in two years while West Texas Intermediate rose to a level unseen in almost three years.

Oil prices kept climbing on Wednesday on signs of strong fuel demand in some economies, while the possibility of Iranian oil returning to global markets was cast in doubt after the United States secretary of state said sanctions against Tehran were not likely to be lifted.

Global benchmark Brent crude futures were up 44 cents, or 0.6 percent, at $72.66 a barrel at 13:38 GMT, having earlier hit $72.83, the highest since May 2019.

United States benchmark West Texas Intermediate (WTI) crude futures were 30 cents higher, or 0.4 percent, at $70.35 a barrel. Earlier, they touched $70.62, the highest since October 2018.

The supercharged multi-year oil prices are a reflection of the improved oil demand sentiment, and along with it, the expectation that crude and products inventories will significantly be reduced in the second half of 2021 as a post-pandemic new normal of oil consumption sets in, Rystad Energys Oil Markets Analyst Louise Dickson said in a Wednesday note.

American drivers are hitting the road again as COVID-19 restrictions are rolled back and vaccination campaigns ramp up catalysing crude demand.

In the US, demand for gasoline and diesel is increasing ahead of the summer driving season, which this year is getting an extra boost of momentum as it coincides with the successful vaccination campaign that has allowed the economy to open up and oil demand to tick higher, Dickson added.

On Tuesday, the US Energy Information Administration (EIA) forecast fuel consumption growth this year in the US, the worlds biggest oil user, would be 1.49 million barrels per day (bpd), up from a previous forecast of 1.39 million bpd.

In another bullish sign, industry data showed US crude oil inventories fell last week.

Price gains had been capped in recent weeks as oil investors had been assuming that sanctions against Iranian exports would be lifted and oil supply would increase this year as Tehrans talks with the US on reviving the Iran-nuclear pact, known as the Joint Comprehensive Plan of Action (JCPOA), progressed.

But on Tuesday, US Secretary of State Antony Blinken cast doubt over the prospects for imminent relief for Irans oil sector after he told a US Senate committee: I would anticipate that even in the event of a return to compliance with the JCPOA, hundreds of sanctions will remain in place, including sanctions imposed by the [President Donald] Trump administration. If they are not inconsistent with the JCPOA, they will remain unless and until Irans behavior changes.

The Organization of the Petroleum Exporting Countries and its allies, a grouping known as OPEC+, has not indicated whether it will stick to supply restraints beyond July.

OPEC Secretary-General Mohammad Barkindo has recently said that OPEC+ foresees inventories falling further in the coming months.

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Oil hits two-year high as doubts gather over Irans market return - Al Jazeera English

Massive fire breaks out at oil refinery near Iran’s capital – Associated Press

  1. Massive fire breaks out at oil refinery near Iran's capital  Associated Press
  2. Firefighters battle massive fire at Iranian oil refinery  CNN
  3. Oil Refinery Fire Near Irans Capital Burns into Second Day  Voice of America
  4. Iran: Huge fire reported in oil refinery in Tehran  The Jerusalem Post
  5. View Full Coverage on Google News

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Massive fire breaks out at oil refinery near Iran's capital - Associated Press

Iran’s Leading Human-Rights Activist Is Boycotting Its Election – Bloomberg

In two weeks, when Iran is scheduled to hold its presidential election, Narges Mohammadi will be staying home. One of her countrys most courageous human-rights activists, she views the upcoming vote as a sham.

The principle of absolute jurisprudence has invalidated all the principles of the Iranian constitution and reduced the power of other institutions to zero, she told me in an WhatsApp interview from Iran. The countrys unelected supreme leader and the countrys Guardian Council, which vets presidential candidates and can overturn laws passed by Irans legislature, have consolidated power.

As if to prove her point, the Guardian Council last month disqualified all but seven candidates from running for president. That decision has drawn rebukes even from Iranian leaders who are supportive of the ruling regime.

But Mohammadis criticism is deeper. As a journalist in the late 1990s, she supported the reformer president, Mohammed Khatami. Now, she has concluded that elections offer no chance for Iran to make the transition to a true democracy.

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In previous elections, she said, Iranians voted for candidates who could create a rift in the system. This split could then create breathing space for the people to achieve democracy and political and civic activity, she said. Now this strategy has reached a dead end.

Iranian President Hassan Rouhani was one of the hardliners who foiled the reforms of Khatami when he authorized a crackdown on student protesters in 1999. Nonetheless, when he won the presidential election in 2013, he was often portrayed as a moderate capable of bringing his country into the community of nations.

Instead, under his presidency Iran has become far more repressive which Mohammadi knows firsthand. Since the late 1990s, she has been prosecuted and jailed for her advocacy work. Under Rouhani, her plight worsened. The organization she helped lead, Defenders of Human Rights Center, was closed. For the last six years, the state has barred her from seeing her children. Last October, after serving more than eight years of a 10-year sentence, she was released from Irans notorious Evin Prison.

Now she faces 30 months in prison and 80 lashes for the crime of participating in a prison sit-in to protest the violent repression of popular protests in November 2019. She does not necessarily fear a new trial, she told me. But she wants the world to know that I was brutally and shamelessly assaulted by the security and non-uniform agents of the head of the prison.

One might think that a person so brutalized by Irans regime would favor the harsh secondary sanctions imposed by former President Donald Trump in 2018. But she considers the sanctions a mistake.

She told me that the secondary sanctions which freeze revenue from Irans main export, oil have the effect of harming both the regime and the Iranian people. (Like Mohammadi, many Iranian human-rights activists do not support the sanctions, though some dissidents do.) That said, Mohammadi supports individual sanctions on human-rights violators in Iran. She supports the idea of prohibiting their participation in international forums and said the international community should work to cut off and control their movements.

At the same time, Mohammadi is critical of the current nuclear diplomacy with Iran. As she sees it, current talks in Vienna should focus not just on Irans nuclear program but on the issue of human rights.

Western governments should respect the concept of the right to self-determination and national sovereignty in the true sense, she told me. This right is enshrined in the charter of the United Nations and it is systematically flouted by the current Iranian regime, which continues to erase the few remnants of that countrys history of constitutional government.

And that brings things back to Irans upcoming presidential elections. They are best seen as a kind of propaganda to persuade gullible outsiders that a clerical tyranny has democratic legitimacy. Narges Mohammadi knows better. Thats why she will be boycotting them.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

To contact the author of this story:Eli Lake at elake1@bloomberg.net

To contact the editor responsible for this story:Michael Newman at mnewman43@bloomberg.net

Before it's here, it's on the Bloomberg Terminal.

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Iran's Leading Human-Rights Activist Is Boycotting Its Election - Bloomberg