U.S. Plans New Sanctions Against Iran’s Oil Industry

By MARK LANDLER and ALAN COWELL

A version of this article appeared in print on November 19, 2011, on page A8 of the New York edition.

WASHINGTON — The Obama administration plans to impose a new round of sanctions against Iran’s petrochemical industry, a Western official briefed on the plans said Friday, less than two weeks after a United Nations report published evidence that the Iranian government was working on a nuclear weapon.

The sanctions, expected to be announced on Monday, build on existing measures against Iran’s oil and gas industry, which aim to curb foreign investment in refineries or other facilities. European nations are expected to announce similar measures when their leaders meet later in the week, the official said.

The sanctions come after the United Nations’ nuclear watchdog, the International Atomic Energy Agency, rebuked Tehran on Friday, but stopped short of threatening further pressure or actions to curb its contentious uranium enrichment program.

In the wake of the report, the United States has been working to build international support for new sanctions. Much of its focus has been on cutting off the Iranian central bank or placing further curbs on the petroleum industry.

But there are hurdles to sanctioning Iran’s central bank, because China, Japan and other countries rely on it to process transactions for purchases of oil. The White House is also reluctant to undertake measures that could lead to spikes in oil prices and rattle a fragile American economy.

While the details of the new sanctions were sketchy — and the Treasury Department declined to comment — the official said they were focused more on investments in Iran’s petrochemical industry than on cutting off sales of oil, which could disrupt the market.

Meanwhile, the criticism from the nuclear agency drew an immediate and sharp response from Iran, which maintains that the evidence for the agency’s report was fabricated by enemies of the Islamic Republic. An Iranian envoy insisted that his country would not be deterred “for a second” from a nuclear program it says is for peaceful purposes. The diplomat also said Iran would boycott a planned meeting next week of Middle Eastern countries, called to discuss ways of freeing the world of nuclear weapons.

The exchanges came at the end of a two-day closed meeting of the 35-member board of governors of the atomic energy agency at its headquarters in Vienna. The agency’s report last week drew on a vast trove of evidence to conclude that there was a “credible” case that Iran engaged in secret and possibly continuing efforts to construct a nuclear weapon.

The concluding resolution, approved overwhelmingly, did not refer to punitive measures against Iran, or send the matter to the Security Council for action, reflecting the diplomatic balance between Western powers eager to crank up pressure on Iran and two leading powers in the diplomacy, Russia and China, that have adopted a milder line.

The resolution expressed “deep and increasing concern about the unresolved issues regarding the Iranian nuclear program,” and urged Iran to return to talks and restrain its nuclear work as outlined by prior Security Council resolutions. The board approved the statement by 32 to 2, with Cuba and Ecuador opposing it and Indonesia abstaining.

The resolution did not set deadlines for Iran to comply with the agency’s demand for access to nuclear sites for its inspectors and greater openness about the country’s nuclear program.

In a statement, the White House welcomed the agency’s sharp criticism of Iran, emphasizing the completeness of the case against Iran made by the agency’s report. “The Director General’s report and today’s action by the Board of Governors expose once and for all the hollowness of Iran’s claims, and reinforce the world’s demands that Iran come clean and live up to its international obligations,” the statement said.

The Iranian envoy to the agency, Ali Asghar Soltanieh, said his country would not halt uranium enrichment for even “a second,” Reuters reported, after having earlier dismissed the resolution’s mandates as “not legally binding, thus they are not applicable.”

Mr. Soltanieh said his country would not participate in the planned gathering next week, under the agency’s auspices, of Middle Eastern countries, likely to include Israel and Arab states.

Western powers that have long pressed for Iran to halt its nuclear enrichment program — the United States, Britain, France and Germany — appear to have been unable to use the unexpectedly strong agency report to create a consensus for stronger action. Instead, the relatively mild resolution reflected lengthy and intense diplomatic wrangling with Russia and China, the other countries most directly involved.

Earlier, Mr. Soltanieh accused the nuclear agency of endangering the lives of Iranian scientists by releasing their names in an annex to last week’s report about the suspicions of nuclear weapons work.

“The release of the names of the Iranian nuclear scientists by the agency has made them targets for assassination by terrorist groups as well as the Israeli regime and the U.S. intelligence services,” he said in a letter to the body’s director general, Yukiya Amano.

Parts of the letter were published by Iran’s state-financed Press TV satellite broadcaster, which noted that several Iranian nuclear scientists had been killed in incidents attributed by Iran to Israeli, British and American intelligence services.

Mr. Soltanieh contended that disclosing the names of Iranian experts represented a violation of the agency’s rules and said Tehran reserved the right to seek damages from the agency for any harm to its personnel or property as a result of the report — a possible reference to Tehran’s frequently voiced fears of an Israeli military strike on its nuclear facilities.

The agency’s report has amplified talk of a potential Israeli attack, a move that Defense Secretary Leon E. Panetta said last week would have a “serious impact” on the Middle East and possibly on American forces in the region, without seriously disrupting Iran’s nuclear program.

On Friday, Mr. Panetta planned to meet Ehud Barak, his Israeli counterpart, and indicated that he would speak of potential “unintended consequences” from a military strike. He was speaking to reporters traveling with him to a security forum in Canada, where he is to meet with Mr. Barak.

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