The European Union imposed an oil embargo onIran, on Monday, in addition to a number of other economic sanctions, in an effort to press the Islamic Republic to stop its Nuclear Development Program. The ban comes in the wake of efforts by theU.S.and the EU to starveIranof oil revenue, amid fears thatIran, despite its assurances that its nuclear program is peaceful, is moving toward development of lethal nuclear weapons. This comes after a tense day, when aU.S.aircraft carrier, accompanied by French and British warships, ventured into the Gulf in defiance of Iranian hostility. In a meeting inBrussels, foreign ministers from the 27-state EU, which as a bloc isIran’s second biggest customer for crude afterChina, agreed to an immediate ban on all new contracts to import, purchase or transport Iranian crude oil and petroleum products. However, EU countries with existing contracts to buy oil and petroleum products can honor them up to July 1. According to data from the International Energy Agency, the EU imports about 600,000 barrels of Iranian oil daily, which accounts for almost a quarter of Tehran’s exports of 2.6 million barrels a day. But some ofEurope’s most-stressed economies,Greece,ItalyandSpain, are among the biggest buyers of oil fromIran.Greece, in particular, has been severely critical of the ban, arguing that a slower implementation was needed to ensure that its economy wouldn’t be excessively burdened.
EU also agreed to freeze the assets ofIran’s central bank and ban trade in gold and other precious metals with the bank and state bodies. The sanctions follow fresh financial measures signed into law by U.S. President Barack Obama on New Year’s Eve, and will mainly target the oil sector, which accounts for some 90 percent of Iranian exports to the EU. A review of the measures will be undertaken before May 1, 2012, to assess whether it the sanctions are effective and whether EU states are succeeding in finding sufficient resources of alternative crude oil. Diplomatic efforts are underway to secure supplies from other sources.Saudi Arabia, the world’s top producer, said this month it would increase production by about 2 million barrels per day. But some analysts assert that, as long asIranis able to sell some oil in the international market, the effectiveness of the embargo will be limited.Chinais the largest importer of Iranian oil.