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How to Put the Squeeze on Iran

[Wall Street Journal] Orde F. Kittrie - If Barack Obama is to persuade Iran to negotiate away its illegal nuclear weapons program, he will first need to generate more leverage. Tehran has an economic Achilles' heel - its extraordinarily heavy dependence on imported gasoline. Iran imports some 40% of the gasoline it needs for internal consumption. In recent months, Iran has purchased nearly all of this gasoline from just five companies: the Swiss firm Vitol; the Swiss/Dutch firm Trafigura; the French firm Total; British Petroleum; and the Indian company Reliance Industries. If these companies stopped supplying Iran, the Iranians could replace only some of what they needed from other suppliers - and at a significantly higher price. Neither Russia nor China could serve as alternative suppliers since both are themselves heavily dependent on gasoline imports. The writer, a professor of law at Arizona State University, worked for 11 years at the State Department, including as a specialist on nuclear nonproliferation and sanctions.
2008-11-13 01:00:00
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