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The Peninsula: Sanctions hurting oil industry: Iran

Web posted at: 7/4/2007 7:15:28
Source ::: Agencies 

TEHRAN • Iran admitted yesterday that international sanctions imposed over its controversial nuclear programme were harming its ability to invest in oil infrastructure.

“The problems that they have made for banks have troubled financing of some projects,” Oil Minister Kazem Vaziri Hamaneh told the official Irna news agency.

The UN Security Council has adopted two sets of sanctions against Iran over its failure to heed ultimatums to suspend uranium enrichment, the process that produces fuel for nuclear power stations, but in extended form can also make the fissile core of an atomic bomb. Washington also imposes separate sanctions of its own.

Meanwhile, Iran’s president has ordered state firms not to raise prices of their goods and threatened to punish violators, media reported yesterday, a move critics say will encourage corruption while failing to tackle inflation. President Mahmoud Ahmadinejad, who came to power in 2005 vowing to share out Iran’s oil wealth more fairly, has been criticised for populist policies, such as forcing down interest rates, that critics say are damaging the economy.

The president’s pledges of largesse are still well received at regular provincial rallies but, mid-way into his four-year term, many Iranians increasingly grumble about the difficulties of finding work and voice frustation about surging prices. Unemployment and inflation rates are both in double digits.

The president, whose government has in the past blamed businesses for falsely inflating prices, ordered state firms to keep prices at levels in March, the end of the last Iranian year, the economic daily Donyaye Eqtesad reported. “Those directors of government-affiliated companies who have raised prices without ratification of the (state) economic council should be seriously and legally confronted and results should be announced to the public,” the daily quoted the order as saying.

State television, which also carried the order, said violators would be “punished” but did not say how.

A mortar shell was fired at a petrol station in Tehran but it failed to explode, an Iranian news agency said, a week after more than a dozen pump stations were torched in protest at gasoline rationing. In a bid to curb costly imports of fuel, the oil-rich country last Wednesday introduced rationing, sparking chaotic and at times violent scenes. One Iranian report last week said 19 petrol stations were set alight in the capital.

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