The Wall Street Journel
BEIRUT—Iran's president attacked Western powers for sanctions against Iran but offered no clear indication on whether his country would return to negotiations on its nuclear program, in
his first public remarks since the European Union agreed to ban Iranian oil imports.
[A handout picture obtained from the Iranian president's office shows Iranian President Mahmoud Ahmadinejad delivering a speech during a visit to the city of Kerman, 1,000km southeast of Tehran.]
In a public rally on Thursday in the southeastern city of Kerman, President Mahmoud Ahmadinejad denied that Iran has been an obstacle to reviving negotiations, but stopped short of offering to restart talks, saying, "Why would we run away from negotiations? Why should the person who is in the right and has logic avoid talks?"
Iran's parliament echoed the defiant tone by saying it would consider an immediate halt of oil exports to Europe to pre-empt the oil embargo, which the EU set to begin on July 1 to give its members time to find alternative supply sources.
Mr. Ahmadinejad declared that the embargo wouldn't hurt Iran's economy, saying other export markets would easily compensate for the loss of sales to Europe, the destination of about a
quarter of Iranian oil exports. The Chinese government, Iran's No. 2 oil buyer after the EU, on Thursday criticized use of sanctions to "blindly pressure" Iran. But the expanding measures are already taking a toll. The value of Iran's currency, the rial, has fallen by nearly 50% against
the dollar in the past month on the black market. The prices of basic food items and other goods are increasing daily, according to Iranian media reports and interviews with Tehran residents.
On Thursday, Iran's central bank devalued the rial by 8% against the dollar and ordered all currency-exchange shops to adhere to the official rate or be shut down, according to Iran's official media.
This week, Mr. Ahmadinejad approved an order that banks increase interest rates to 21%, from between 12.5% and 15%, to encourage Iranians to keep their capital in domestic banks, as
Iranians hoard dollars and gold.
In his speech, he appeared to try to rally the public behind the government and against Western pressure, saying ordinary people would ultimately suffer the most from sanctions. The West is "the enemy of the Iranian people….The bigger the challenge, the stronger is our will," he said.
His statements come as Iran's government seeks a show of support in parliamentary elections on March 2 from a public besieged by economic hardships.
Iran has already conceded to allow nuclear inspectors to come to Iran before the end of January. Mr. Ahmadinejad doesn't ultimately hold the key to Iranian concessions: Such decisions are in the hands of Supreme Leader Ayatollah Ali Khamenei.
"Ahmadinejad isn't steering Iran's nuclear ship, Khamenei is," said Karim Sadjadpour, an Iran analyst with the Carnegie Endowment for International Peace.
European leaders, in announcing sanctions Monday, said they weren't targeting the people of Iran, but the country's leadership. The EU also agreed to freeze the assets of Iran's central bank, the conduit for the country's oil revenue, and ban trade with its petrochemical industry.
The U.S. and EU aim to put pressure Iran to return to negotiations on the country's nuclear program, which the West says is aimed at arms production and Iran contends is for peaceful purposes.
U.S. and EU officials have said Iran hasn't formally responded to a request in October to return to talks with the international community, represented by the five permanent members of the United Nations Security Council plus Germany.
Also on Thursday, Iranian lawmakers called on the Organization of Petroleum Exporting Countries to intervene against a pledge by Saudi Arabia that it would increase oil supply if needed.
Mr. Ahmadinejad, without mentioning any countries, weighed in on the mounting confrontation with Saudi Arabia in his speech, saying those promising to boost oil output were tools of the
West with a short view of history.
OPEC, which has so far tried to stay away from the Iranian-Saudi feud, hasn't received a formal request from Tehran for an emergency meeting, people familiar with the matter said on Thursday.
The International Energy Agency, which coordinates emergency oil stocks held by countries in the Organization for Economic Cooperation and Development, sees no need for an emergency
supply release now, the agency's Executive Director Maria van der Hoeven said.
China's statement on Thursday underscored the difficulty the West faces in creating a wedge between Iran and one of the largest buyers of Iranian crude.
"To blindly pressure and impose sanctions on Iran aren't constructive approaches," China's Foreign Ministry said, according to the state-run Xinhua news agency. The statement said China hopes to solve such disputes through dialogue and consultation.
China's dependence on Iranian oil grew last year, with imports rising more than 30% to 27.8 million metric tons, or nearly 560,000 barrels a day, according to customs data. China consumes more than nine million barrels of oil a day, second only to the U.S. China has joined previous U.N. efforts aimed at getting Tehran to curtail any nuclear-weapons ambitions, but has balked at the U.S. efforts to raise pressure on Iran outside U.N. auspices.
The EU ban could give China more leverage with Iran's state oil company. People familiar with the contract talks between China United Petroleum & Chemicals Co., or Unipec, and the National Iranian
Oil Co. have said the two sides are still haggling over economic terms, in a dispute these people have said is unrelated to the nuclear issue.
—Carlos Tejada in Beijing and Benoît Faucon in London contributed to this article.WSJ
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