Tag Archives: Sanctions

Prepare for difficult times, China’s Xi urges as trade war simmers

FILE PHOTO: Chinese President Xi Jinping attends the Conference on Dialogue of Asian Civilizations in Beijing, China May 15, 2019. REUTERS/Thomas Peter/File Photo

By Michael Martina and David Lawder

BEIJING/WASHINGTON (Reuters) – China must prepare for difficult times as the international situation is increasingly complex, President Xi Jinping said in comments carried by state media on Wednesday, as the U.S.-China trade war took a mounting toll on tech giant Huawei.

The world’s two largest economies have escalated tariff increases on each other’s imports after talks broke down to resolve their dispute, and the acrimony has intensified since Washington last week blacklisted Chinese telecom equipment company Huawei Technologies Co Ltd.

The listing, which curbs Huawei’s access to U.S.-made components, is a potentially devastating blow for the company that has rattled technology supply chains and investors, and saw several mobile carriers on Wednesday delay the launch of new Huawei smartphone handsets.

During a three-day trip this week to the southern province of Jiangxi, a cradle of China’s Communist revolution, Xi urged people to learn the lessons of the hardships of the past.

“Today, on the new Long March, we must overcome various major risks and challenges from home and abroad,” state news agency Xinhua paraphrased Xi as saying, referring to the 1934-36 trek of Communist Party members fleeing a civil war to a remote rural base, from where they re-grouped and eventually took power in 1949.

“Our country is still in a period of important strategic opportunities for development, but the international situation is increasingly complicated,” he said.

“We must be conscious of the long-term and complex nature of various unfavorable factors at home and abroad, and appropriately prepare for various difficult situations.”

The report did not elaborate on those difficulties, and did not directly mention the trade war or of the United States.

No further trade talks between top Chinese and U.S. negotiators have been scheduled since the last round ended on May 10, the same day President Donald Trump increased tariffs on $200 billion worth of Chinese goods and took steps to levy duties on all remaining Chinese imports.

Negotiations between the United States and China have stalled since early May, when Chinese officials sought major changes to the text of a proposed deal that the Trump administration says had been largely agreed.

However, Chinese Ambassador to the United States Cui Tiankai, speaking to the Fox News Channel, said on Tuesday that Beijing was still open for talks.

Repercussions of the blacklisting mounted for Huawei, with some mobile operators, including the Ymobile unit of Japan’s Softbank Corp and rival KDDI Corp putting launch plans for Huawei’s new P30 Lite smartphone on hold.

Another big Chinese tech firm, video surveillance equipment maker Hikvision Digital Technology Co Ltd, could also face limits on its ability to buy U.S. technology, the New York Times reported, citing people familiar with the matter, sending the firm’s Shenzhen-listed shares down 5.54 percent.

RETALIATION

While China has not said whether or how it may retaliate to the measures against Huawei, state media have taken an increasingly strident and nationalistic tone.

U.S. firms said in a survey released on Wednesday they were facing retaliation in China over the trade war. The American Chamber of Commerce of China and its sister body in Shanghai, said members reported that they faced increased obstacles such as government inspections, slower customs clearances and slower approval for licensing and other applications.

It also said that 40.7% of respondents were considering or had relocated manufacturing facilities outside China. Of the almost 250 respondents to the survey, which was conducted after China and the United States both raised tariffs on each other’s imports this month, almost three-quarters said the impact of tariffs was hurting their competitiveness.

To cope, about one third said they were increasingly focusing their China operations on producing for Chinese customers and not for export, while one third said they were delaying and canceling investment decisions.

Long considered a solid cornerstone in a relationship fraught with geopolitical frictions, the U.S. business community has in recent years advocated a harder line on what it sees as discriminatory Chinese trade policies.

The United States is seeking sweeping changes to trade and economic policies, including an end to forced technology transfers and theft of U.S. trade secrets. Washington also wants curbs on subsidies for Chinese state-owned enterprises and increased access for U.S. firms in Chinese markets.

China for years has blocked major U.S. tech firms, including Google and Facebook, from fully operating in its market. Those and other restrictions have fueled calls from within the U.S. business community for Washington to pursue more reciprocal policies.

Cui told Fox News Channel that U.S. restrictions on Huawei “are without any foundation and evidence” and could undermine the normal functioning of markets.

“Everybody knows Huawei is a privately owned company. It is just a normal Chinese private company,” Cui said. “So all the action taken against Huawei are politically motivated.”

(Reporting by David Lawder and Stella Qiu; Additional reporting by Makini Brice and Eric Beech in Washington and Michael Martina and Ben Blanchard; writing by Tony Munroe; Editing by Simon Cameron-Moore, Robert Birsel)

Iranians tense and apprehensive as whispers of war spread

FILE PHOTO: Iranian President Hassan Rouhani delivers a speech during the ceremony of the National Army Day parade in Tehran, Iran April 18, 2019. Tasnim News Agency/via REUTERS

By Bozorgmehr Sharafedin

LONDON (Reuters) – Iranian and U.S. leaders have reassured their nations that they do not seek war. But among ordinary Iranians who already face hardship from tightening sanctions, nerves are being strained by worry that the situation could slip out of control.

In interviews conducted from outside the country by telephone and online, Iranians described heated discussions at home, on the streets and on social media.

The prospect of war was now the main topic of conversation in workplaces, taxis and buses, Nima Abdollahzade, a legal consultant at an Iranian startup company, told Reuters.

“Apart from the deterioration in the Iranian economy, I believe the most severe effect” of confrontation with the United States “is in the mental situation of ordinary Iranians,” he said. “They are sustaining a significant amount of stress.”

The United States pulled out of an agreement between Iran and world powers a year ago that limited Iran’s nuclear program in return for lifting economic sanctions.

This month tensions have risen sharply, with Washington extending its sanctions to ban all countries from importing Iranian oil. A number of U.S. officials led by National Security Adviser John Bolton have made hawkish remarks, citing Iranian threats against U.S. interests. Trump himself tweeted: “If Iran wants to fight, that will be the official end of Iran.”

Iran has tended to dismiss the tough talk as a bluff – “psychological warfare” from a U.S. administration not ready for a fight. But some Iranians say the tension could have its own logic, raising the chance of a mistake leading to violence.

‘A DOG THAT WON’T BITE BARKS’

A labor activist who spent months in an Iranian jail for his activities and asked not to be identified, said: “War and sanctions are two sides of the same coin, designed by the (U.S.) capitalist system. The working class would bear brunt of the pressures.”

Some Iranians expect pressure to lead to negotiations, as when former President Barack Obama tightened sanctions that crippled the Iranian economy and led to the 2015 deal.

But others believe their leaders will never go back down that road following Trump’s reimposition of sanctions.

“Any politician who starts negotiations with America would make a fool of himself,” said a student who also asked not to be identified. “Even (Mohammad Javad) Zarif has given up on that,” she said, referring to Iran’s U.S.-educated foreign minister.

Zarif told CNN this week Iran had “acted in good faith” in negotiating the deal that Washington abandoned. “We are not willing to talk to people who have broken their promises.”

Trump has said Washington is not trying to set up talks but expects Tehran to call when it is ready. A U.S. official said last week Americans “were sitting by the phone”, but had received no call from Iran yet.

Foad Izadi, a political science professor at Tehran University, told Reuters that phone call is not coming.

“Iranian officials have come to this conclusion that Trump does not seek negotiations. He would like a phone call with Rouhani, even a meeting and a photo session, but that’s not a real negotiation,” Izadi said.

Despite saying talks are now off the table, Iranian leaders still say war is unlikely. Supreme Leader Ayatollah Ali Khamenei, Iran’s highest authority, said the United States would not attack as “it’s not in their interests.”

The logic makes sense to Mohsen Mortazavi, a young cleric who graduated from a religious school in the city of Qom.

“There won’t be any war because a military confrontation will not resolve any of the U.S. problems, it will only add to them,” Mortazavi told Reuters. “Trump’s shouts and threats are a psychological war. A dog that cannot bite barks.”

But Izadi, the political science professor, disagrees. “A war is highly probable. There are officials in Washington who have planned for invading Iran for years,” he said.

STOCKPILING

Meanwhile, Iranians cope with the day-to-day implications of sanctions and tension. Worries over access to products have prompted some Iranians to stock up on rice, detergent and tinned food, residents and shopkeepers said.

An advertisement on state TV discourages stockpiling. A middle-aged man heading home after work is drawn to a supermarket when he sees people panic shopping. He buys anything he can put his hands on, causing shelves to be emptier.

Ali, an Iranian student in Tehran, told Reuters that unlike many, he was not against a U.S. military invasion, as he believed the fall of the Islamic Republic would be the only solution to the rising economic and political problems.

“My only hope is a war so I can take my revenge. I am telling my friends in the university that our only way is an armed struggle…. We have nothing to lose.”

Shahin Milani, a 38-year-old who tweets about Iranian politics to more than 7,000 followers on Twitter, believes military intervention could never bring democracy.

“The people should do it themselves … If someone is truly worried about the threat of war, they should work to create a democratic, secular government in Iran … As long as the Islamic Republic is in power, the shadow of war will loom over Iran.”

(Reporting by Bozorgmehr Sharafedin; Editing by Peter Graff)

Trump, Saudi Arabia warn Iran against Middle East conflict

FILE PHOTO: Saudi Arabia's Minister of State for Foreign Affairs Adel bin Ahmed Al-Jubeir speaks during a news conference with Russia's Foreign Minister Sergei Lavrov (not pictured) in Riyadh, Saudi Arabia March 4, 2019. REUTERS/Faisal Al Nasser

By Marwa Rashad and Stephen Kalin

RIYADH (Reuters) – U.S. President Donald Trump issued a new threat to Tehran on Sunday, tweeting that a conflict would be the “official end” of Iran, as Saudi Arabia warned it stood ready to respond with “all strength” and said it was up to Iran to avoid war.

The heightened rhetoric follows last week’s attacks on Saudi oil assets and the firing of a rocket on Sunday into Baghdad’s heavily fortified “Green Zone” that exploded near the U.S. embassy.

“If Iran wants to fight, that will be the official end of Iran. Never threaten the United States again!” Trump said in a tweet without elaborating.

A U.S. State Department official said the rocket attack in Baghdad did not hit a U.S.-inhabited facility and produced no casualties nor any significant damage. No claims of responsibility had been made, but the United States was taking the incident “very seriously.”

FILE PHOTO: A damaged Andrea Victory ship is seen off the Port of Fujairah, United Arab Emirates, May 13, 2019. REUTERS/Satish Kumar/File Photo

FILE PHOTO: A damaged Andrea Victory ship is seen off the Port of Fujairah, United Arab Emirates, May 13, 2019. REUTERS/Satish Kumar/File Photo

“We have made clear over the past two weeks and again underscore that attacks on U.S. personnel and facilities will not be tolerated and will be responded to in a decisive manner,” the official said in an emailed statement. “We will hold Iran responsible if any such attacks are conducted by its proxy militia forces or elements of such forces, and will respond to Iran accordingly.”

Riyadh, which emphasized that it does not want a war, has accused Tehran of ordering Tuesday’s drone strikes on two oil pumping stations in the kingdom, claimed by Yemen’s Iran-aligned Houthi group. Two days earlier, four vessels, including two Saudi oil tankers, were sabotaged off the coast of the United Arab Emirates.

In response, countries of the Gulf Cooperation Council (GCC) began “enhanced security patrols” in the international waters of the Arabian Gulf area on Saturday, the U.S. Navy’s Bahrain-based Fifth Fleet said on Sunday.

Iran has denied involvement in either incident, which come as Washington and the Islamic Republic spar over sanctions and the U.S. military presence in the region, raising concerns about a potential U.S.-Iran conflict.

“The kingdom of Saudi Arabia does not want a war in the region nor does it seek that,” Minister of State for Foreign Affairs Adel al-Jubeir told a news conference on Sunday.

“It will do what it can to prevent this war and at the same time it reaffirms that in the event the other side chooses war, the kingdom will respond with all force and determination, and it will defend itself and its interests.”

Saudi Arabia’s King Salman on Sunday invited Gulf and Arab leaders to convene emergency summits in Mecca on May 30 to discuss implications of the attacks.

“The current critical circumstances entail a unified Arab and Gulf stance toward the besetting challenges and risks,” the UAE foreign ministry said in a statement.

The U.S. Navy’s Fifth Fleet said in its statement about increased maritime patrols that GCC countries were “specifically increasing communication and coordination with each other in support of regional naval cooperation and maritime security operations in the Arabian Gulf,” with navies and coast guards working with the U.S. Navy.

Saudi Arabia’s Sunni Muslim ally the UAE has not blamed anyone for the tanker sabotage operation, pending an investigation. No-one has claimed responsibility, but two U.S. government sources said last week that U.S. officials believed Iran had encouraged the Houthi group or Iraq-based Shi’ite militias to carry it out.

The drone strike on oil pumping stations, which Riyadh said did not disrupt output or exports, was claimed by the Houthis, who have been battling a Saudi-led military coalition in a war in Yemen since 2015.

FILE PHOTO: A damaged ANDREA VICTORY ship is seen off the Port of Fujairah, United Arab Emirates, May 13, 2019. REUTERS/Satish Kumar/File Photo

FILE PHOTO: A damaged ANDREA VICTORY ship is seen off the Port of Fujairah, United Arab Emirates, May 13, 2019. REUTERS/Satish Kumar/File Photo

The Houthi-controled SABA news agency said on Sunday, citing a military source from the group, that targeting Aramco’s installations last week was the beginning of coming military operations against 300 vital military targets.

Targets include vital military headquarters and facilities in the United Arab Emirates, Saudi Arabia, as well as their bases in Yemen, the source told SABA.

The head of the Houthis’ Supreme Revolutionary Committee, Mohammed Ali al-Houthi, derided Riyadh’s call to convene Arab summits, saying in a Twitter post that they “only know how to support war and destruction”.

A Norwegian insurers’ report seen by Reuters said Iran’s Revolutionary Guards were “highly likely” to have facilitated the attack on vessels near the UAE’s Fujairah emirate, a main bunkering hub lying just outside the Strait of Hormuz.

SAUDI PRINCE CALLS POMPEO

Iranian Foreign Minister Mohammad Javad Zarif has dismissed the possibility of war erupting, saying Tehran did not want conflict and no country had the “illusion it can confront Iran”. This stance was echoed by the head of Iran’s elite Revolutionary Guards on Sunday.

“We are not pursuing war but we are also not afraid of war,” Major General Hossein Salami was cited as saying by the semi-official news agency Tasnim.

Washington has tightened economic sanctions against Iran, trying to cut Tehran’s oil exports to zero, and beefed up the U.S. military presence in the Gulf in response to what it said were Iranian threats to United States troops and interests.

Crown Prince Mohammed bin Salman discussed regional developments, including efforts to strengthen security and stability, in a phone call with U.S. Secretary of State Mike Pompeo, the Saudi Media Ministry tweeted on Sunday.

“We want peace and stability in the region but we will not sit on our hands in light of the continuing Iranian attack,” Jubeir said. “The ball is in Iran’s court and it is up to Iran to determine what its fate will be.”

He said the crew of an Iranian oil tanker that had been towed to Saudi Arabia early this month after a request for help due to engine trouble were still in the kingdom receiving the “necessary care”. The crew are 24 Iranians and two Bangladeshis.

Saudi Arabia and Shi’ite Iran are arch-adversaries in the Middle East, backing opposite sides in several regional wars. In a sign of the heightened tension, Exxon Mobil evacuated foreign staff from an oilfield in neighboring Iraq.

Bahrain on Saturday warned its citizens against travel to Iraq and Iran and asked those already there to return. The U.S. Federal Aviation Administration has issued an advisory to U.S. commercial airliners flying over the waters of the Gulf and the Gulf of Oman to exercise caution.

(Additional reporting by Lisa Barrington in Dubai, Nandita Bose in Washington, Ali Abdelaty in Cairo, Babak Dehghanpisheh in Geneva; Writing by Stephen Kalin, Ghaida Ghantous and David Lawder; Editing by Raissa Kasolowsky, Mark Potter, Chris Reese and Sandra Maler)

U.S. pulls staff from Iraq amid concerns over Iran

A staff member removes the Iranian flag from the stage after a group picture with foreign ministers and representatives of the U.S., Iran, China, Russia, Britain, Germany, France and the European Union during the Iran nuclear talks at the Vienna International Center in Vienna, Austria July 14, 2015. To match Analysis USA-ELECTION/IRAN

By John Davison and Raya Jalabi

BAGHDAD (Reuters) – Washington ordered the departure of non-emergency American employees from its diplomatic missions in Iraq on Wednesday in another show of concern about alleged threats from Iran.

President Donald Trump’s administration is applying new sanctions pressure on Tehran and sending additional forces to the Middle East to counter what it says is a heightened threat from Iran to U.S. soldiers and interests in the region.

Iran calls that “psychological warfare”, and a British commander cast doubt on U.S. military concerns about threats to its roughly 5,000 soldiers in Iraq, who have been helping local security forces fight Islamic State jihadists.

The U.S. State Department said employees at both the U.S. embassy in Baghdad and its consulate in Erbil, capital of semi-autonomous Kurdistan region, were being pulled out immediately due to safety concerns.

It was unclear how many personnel were affected, and there was no word on any specific threat. Visa services were suspended at the heavily-fortified U.S. missions.

“Ensuring the safety of U.S. government personnel and citizens is our highest priority … and we want to reduce the risk of harm,” a State Department spokesman said.

Also on Wednesday, Germany, which has 160 soldiers in Iraq, suspended military training operations, citing increasing regional tensions. And the Netherlands suspended a mission providing assistance to Iraqi local authorities, Dutch news agency ANP said.

“DANGEROUS SITUATION”

Both the United States and Iran have said they do not want war, and Iraqi Prime Minister Adel Abdul Mahdi said on Tuesday he had indications “things will end well” despite the rhetoric.

Iraq has said it will keep strong ties with Iran, but also with the United States and regional neighbors, some of whom, like Saudi Arabia, consider Tehran an arch-rival.

“I think we are now in a quite dangerous situation where a miscalculation by either side could lead us into conflict,” U.S. Senator Chris Coons, a Democrat on the Senate Foreign Relations Committee, told CNN in an interview on Wednesday.

“When you project force into a very volatile region and you’ve got real tension between Iran and the Saudis — we have to be careful. We need a strategy,” Coons said, echoing a call by Congress for the government to brief lawmakers.

The State Department reissued travel advisory for Iraq saying U.S. citizens were at high risk of violence and kidnapping. “Anti-U.S. sectarian militias may also threaten U.S. citizens and Western companies throughout Iraq,” it said.

A senior Iranian official said on Wednesday that any conflict in the region will have “unimaginable consequences.”

(Reporting by John Davison and Ahmed Rasheed in Baghdad, Raya Jalabi in Erbil; Additional reporting by Susan Heavy and Makini Brice in Washington; Writing by Raya Jalabi and John Davison; Editing by Catherine Evans and Andrew Cawthorne)

Trump supports plan for humanitarian food aid to North Korea

U.S. President Donald Trump arrives at an event to celebrate the anniversary of first lady Melania Trump's “Be Best” initiative in the Rose Garden at the White House in Washington, U.S., May 7, 2019. REUTERS/Jonathan Ernst

WASHINGTON (Reuters) – South Korea said that U.S. President Donald Trump supports the country’s plan to provide humanitarian food aid to North Korea, Yonhap reported on Tuesday.

Trump and South Korean President Moon Jae-in spoke for 35 minutes earlier on Tuesday, during a call in which the two leaders also discussed ways to continue dialogue with Pyonyang, the South Korean news agency reported.

The White House did not immediately respond to a request for comment.

Asked by reporters in April whether he was prepared to ease some sanctions on North Korea, Trump said he and Moon were discussing “certain humanitarian things” and the possibility of South Korea helping North Korea with food.

Nearly half of North Koreans suffer from severe food insecurity and meager official rations are expected to be cut further after dry spells, heat waves and flooding have led to the worst harvest in a decade, the United Nations said on Friday.

Trump and North Korean leader Kim Jong Un have met twice, but talks between the two leaders have stalled. On Saturday, North Korea fired projectiles off its coast, but Trump and his administration have played down the weapons tests.

(Reporting by Makini Brice; Additional reporting by Doina Chiacu)

U.S. working to designate Muslim Brotherhood a terrorist group: White House

White House spokeswoman Sarah Sanders talks to reporters at the White House in Washington, U.S., April 29, 2019. REUTERS/Kevin Lamarque

By Steve Holland

WASHINGTON (Reuters) – The Trump administration is working to designate the Muslim Brotherhood a foreign terrorist organization, the White House said on Tuesday, which would bring sanctions against Egypt’s oldest Islamist movement.

“The president has consulted with his national security team and leaders in the region who share his concern, and this designation is working its way through the internal process,” White House press secretary Sarah Sanders said in an email.

Egyptian President Abdel Fattah al-Sisi asked President Donald Trump to make the designation, which Egypt has already done, in a private meeting during a visit to Washington on April 9, a senior U.S. official said, confirming a report in the New York Times on Tuesday.

After the meeting, Trump praised Sisi as a “great president” while a bipartisan group of U.S. lawmakers raised concerns about Sisi’s record on human rights, efforts to keep him in office for many years and planned Russian arms purchases.

Sisi, who ousted President Mohamed Mursi of the Muslim Brotherhood in 2013 and was elected president the following year, has overseen a crackdown on Islamists as well as liberal opposition in Egypt.

White House national security adviser John Bolton and Secretary of State Mike Pompeo support the designation but officials at the Pentagon and elsewhere have been opposed and have been seeking more limited action, the senior official said.

The Brotherhood, which estimates its membership at up to 1 million people, came to power in Egypt’s first modern free election in 2012, a year after long-serving autocrat Hosni Mubarak was toppled in a popular uprising. But the movement is now banned and thousands of its supporters and much of its leadership have been jailed.

The Egyptian government blamed the organization for a 2013 suicide bomb attack on a police station that killed 16 people. The Brotherhood condemned that attack and denies using violence.

Some conservative and anti-Muslim activists have argued for years that the Brotherhood, which was founded in Egypt in 1928 and sought to establish a worldwide Islamic caliphate by peaceful means, has been a breeding ground for terrorists.

Designating the Muslim Brotherhood a terrorist designation could complicate Washington’s relationship with NATO ally Turkey. The organization has close ties with President Tayyip Erdogan’s ruling AK Party and many of its members fled to Turkey after the group’s activities were banned in Egypt.

Turkey is under threat of U.S. sanctions if it pursues plans to purchase Russian S-400 missile defense systems, which are not compatible with NATO systems.

Washington also says Turkey’s purchase of the S-400s would compromise the security of F-35 fighter jets, which are built by Lockheed Martin Corp and use stealth technology.

The U.S. administration debated the terrorist designation for the Muslim Brotherhood shortly after Trump took office in January 2017.

Some branches of the Brotherhood, including the Palestinian group Hamas, have engaged in anti-government violence and provoked violent government reactions. Ayman al-Zawahiri, the leader of al-Qaeda, was once a member of the Egyptian Muslim Brotherhood.

Other offshoots in Turkey and Tunisia have forsworn violence and come to power by democratic means.

(Reporting by Steve Holland and Doina Chiacu; Editing by Franklin Paul and Bill Trott)

Putin-Kim summit sends message to U.S. but sanctions relief elusive for North Korea

FILE PHOTO: A combination of file photos shows North Korean leader Kim Jong Un attending a wreath laying ceremony at Ho Chi Minh Mausoleum in Hanoi, Vietnam March 2, 2019 and Russia's President Vladimir Putin looking during a joint news conference with South African President Jacob Zuma after their meeting at the Bocharov Ruchei residence in the Black Sea resort of Sochi, Krasnodar region, Russia, May 16, 2013. REUTERS/Jorge Silva/Pool/Maxim Shipenkov/Pool/File Photo

By Josh Smith

SEOUL (Reuters) – North Korean leader Kim Jong Un is set to meet Russian President Vladimir Putin for the first time this week at a symbolic summit hoping to project himself as a serious world player but likely to come away without the relief he seeks from crushing sanctions.

After his second summit with U.S. President Donald Trump ended without an agreement two months ago, Kim’s meeting with Putin serves as a reminder to Washington that he has other options in the region backing his leadership.

But while Kim is likely to seek more assistance from one of his country’s two main backers, Russia will be limited in what it can provide and the summit will focus more on demonstrating camaraderie than new investment or aid, analysts said.

“When Kim meets Putin, he is going to ask for economic assistance and unilateral sanctions relaxation. Moscow is unlikely to grant his wishes,” said Artyom Lukin, a professor at Far Eastern Federal University in Vladivostok.

That school’s campus is seen to be the summit venue, according to South Korean media which reported the presence of Kim’s top aides there making preparations for the event.

“Being a veto-holding U.N. Security Council member, Moscow can hardly afford to undermine its authority even for the sake of friendship with Kim,” Lukin said.

SANCTIONS RELIEF

While Russia says it fully enforces the sanctions that it voted to impose, it has joined China in calling for loosening punishment for North Korea in recognition of steps taken in limiting its weapons testing.

“Steps by the DPRK towards gradual disarmament should be followed by the easing of sanctions,” Russian Foreign Minister Sergei Lavrov said at a Security Council meeting late last year, using the initials of the North’s official name, the Democratic People’s Republic of Korea.

Washington has accused Russia of “cheating” on sanctions and said it has evidence of “consistent and wide-ranging Russian violations”.

In February, Reuters reported a Russian tanker violated international trade sanctions by transferring fuel to a North Korean vessel at sea at least four times between October 2017 and May 2018.

One Russian lawmaker told Interfax news agency last week that North Korea had asked Moscow to allow its laborers to continue to work in Russia despite sanctions requiring their expulsion by the end of this year.

“One particularly sore area for Kim is the issue of North Korean laborers working in Russia,” said Anthony Rinna, a specialist in Korea-Russia relations at Sino-NK, a website that analyses the region.

“Kim will probably be seeking some wiggle-room from Russia, although Moscow will be hard-pressed to accommodate Kim given its desire to portray a responsible image in the world.”

The United States has said it believed Pyongyang was earning more than $500 million a year from nearly 100,000 workers abroad, including 30,000 in Russia.

According to unpublished reports by Moscow to the United Nations Security Council, Russia sent home nearly two-thirds of its North Korean workers during 2018.

The report, reviewed by Reuters, said in 2018 the number of North Koreans with work permits in Russia fell to about 11,500.

LONG TIES

Russia-North Korea relations withered after the Soviet demise, with the loss of support from Moscow often cited as one factor that lead to a 1990s famine that killed hundreds of thousands of North Koreans.

Kim Jong Un’s father, Kim Jong Il, worked to renew ties after Putin first became president in 1999. He visited Russia three times before his sudden death in 2011.

Russia could agreed on some limited projects like a vehicle bridge connecting the two countries across the Tumangan River, or provide more humanitarian aid, Lukin said.

Earlier this year, Russia sent more than 2,000 tons of wheat to North Korea through the World Food Program. Russian lawmakers have suggested Moscow could send as much as 50,000 tons of wheat to North Korea.

According to the United Nations, Russia has continued to sell significant amounts of oil to North Korea, though still officially under sanctions caps.

North Korea’s state media said in March officials met in Moscow to sign an agreement “to boost high-level contact and exchange in the political field (and) actively promote cooperation in the fields of economy and humanitarianism.”

While Moscow is unlikely to risk its authority at the United Nations by overtly breaching sanctions, Putin could promise not to support any additional sanctions, Lukin said.

“Kim can expect a friendly reception here and probably some chance of getting political and economic support from Putin.”

(Reporting by Josh Smith, additional reporting by Vladimir Soldatkin in Moscow.; Editing by Jack Kim and Lincoln Feast.)

Iran’s Zarif warns U.S. of ‘consequences’ over oil sanctions, Strait of Hormuz

FILE PHOTO: Iranian Foreign Minister Mohammad Javad Zarif speaks during a news conference with Iraqi Foreign Minister Mohamed Ali Alhakim, in Baghdad, Iraq, March 10, 2019. REUTERS/Khalid Al-Mousily/File Photo

By Michelle Nichols and Lesley Wroughton

NEW YORK (Reuters) – The United States must be prepared for consequences if it tries to stop Iran from selling oil and using the Strait of Hormuz, Iran’s Foreign Minister Mohammad Javad Zarif warned on Wednesday, while also offering to negotiate prisoner swaps with Washington.

The United States on Monday demanded buyers of Iranian oil stop purchases by May or face sanctions, ending six months of waivers which allowed Iran’s eight biggest buyers, most of them in Asia, to continue importing limited volumes.

“We believe that Iran will continue to sell its oil. We will continue to find buyers for our oil and we will continue to use the Strait of Hormuz as a safe transit passage for the sale of our oil,” Zarif told an event at the Asia Society in New York.

Reinforcing Supreme Leader Ayatollah Ali Khamenei’s stance, Zarif warned: “If the United States takes the crazy measure of trying to prevent us from doing that, then it should be prepared for the consequences.” He did not give specifics.

Oil prices hit their highest level since November on Tuesday after Washington’s announcement.

When asked if the U.S. pressure campaign on Tehran was aimed at sparking further negotiations or regime change, Zarif said: “The B team wants regime change at the very least.” He described the B Team as including Israeli Prime Minister Benjamin Netanyahu and Trump’s national security adviser John Bolton.

“It is not a crisis yet, but it is a dangerous situation. Accidents … are possible. I wouldn’t discount the B team plotting an accident anywhere in the region, particularly as we get closer to the election. We are not there yet.”

Zarif suggested possible cooperation with the United States to bring stability to Iraq and Afghanistan, a priority for both Tehran and Washington.

He also said he was willing to swap British-Iranian aid worker Nazanin Zaghari-Ratcliffe, who has been detained in Iran since 2016, for an Iranian woman detained in Australia for the past three years on a U.S. extradition request.

“I feel sorry for them, and I have done my best to help,” Zarif said of Zaghari-Ratcliffe. “But nobody talks about this lady in Australia who gave birth to a child in prison. … I put this offering on the table publicly now – exchange them.”

Zarif then went on to say that Iran had told the U.S. administration six months ago that it was open to a prisoner swap deal, but had not yet received a response.

“All these people that are in prison inside the United States, on extradition requests from the United States, we believe their charges are phony. The United States believes the charges against these people in Iran are phony. Let’s not discuss that,” he said.

“Let’s have an exchange. I’m ready to do it and I have authority to do it,” Zarif said.

(Reporting by Michelle Nichols and Lesley Wroughton; Editing by Chizu Nomiyama and Jonathan Oatis)

Oil hits 2019 high on U.S. plan to tighten squeeze on Iran

FILE PHOTO: An oil pump jack pumps oil in a field near Calgary, Alberta, Canada, July 21, 2014. REUTERS/Todd Korol/File Photo

By Stephanie Kelly

NEW YORK (Reuters) – Oil prices jumped more than 2 percent on Monday to a near six-month high, on growing concern about tight global supplies after the United States announced a further clampdown on Iranian oil exports.

Washington said it will eliminate in May all waivers allowing eight economies to buy Iranian oil without facing U.S. sanctions.

“The geopolitical risk premium is back in the oil market, in a big way,” said John Kilduff, a partner at Again Capital LLC in New York. “Most, if not all, legitimate commercial interests will avoid Iran oil purchases. Iran’s flow will be reduced to a trickle.”

Brent crude futures rose $2.07, or 2.88 percent, to settle at $74.04 a barrel. The session high of $74.52 a barrel for the international benchmark was the highest since Nov. 1.

U.S. West Texas Intermediate crude futures climbed $1.70, or 2.66 percent, to settle at $65.70 a barrel. The contract hit $65.92 a barrel, the highest since Oct. 31.

In November the United States reimposed sanctions on exports of Iranian oil but granted waivers to Iran’s eight main buyers: China, India, Japan, South Korea, Taiwan, Turkey, Italy and Greece. They were allowed to keep making limited purchases for six months.

U.S. Secretary of State Mike Pompeo reiterated that Washington’s goal was to bring down exports of Iranian oil to zero and said there were no plans for a grace period beyond May 1.

U.S. officials are seeking ways to prevent Iran from circumventing oil sanctions, a senior administration official said.

Iran said the decision not to renew the waivers has “no value” but Tehran was in touch with European partners and neighbors and would “act accordingly,” Iranian news agencies reported, citing the Foreign Ministry.

Another drop in Iranian exports would further squeeze supply in a tight market. The United States has also sanctioned OPEC member Venezuela, and the Organization of the Petroleum Exporting Countries and allied producers including Russia have voluntarily cut output, which has helped raise oil prices more than 35 percent this year.

Iran’s biggest oil customers are China and India. India hopes Washington will allow allies to keep buying some Iranian oil instead of halting the purchases altogether from May, a source familiar with U.S.-India talks said.

Trump said Saudi Arabia and other OPEC nations could “more than make up” for any drop in Iranian oil supplies.

Saudi Arabia said it would coordinate with other producers to ensure an adequate crude supply and a balanced market.

“By and large, we expect the Saudis to up output in likely capping Brent price advances to around the $75-76 area followed by some leveling through much of the spring period,” Jim Ritterbusch, president of Ritterbusch and Associates, said in a note.

 

(Additional reporting by Alex Lawler in London and Henning Gloystein in Singapore; Editing by David Gregorio and Susan Thomas)

Satellite images may show reprocessing activity at North Korea nuclear site: U.S. researchers

A view of what researchers of Beyond Parallel, a CSIS project, describe as specialized rail cars at the Yongbyon Nuclear Research Center in North Pyongan Province, North Korea, in this commercial satellite image taken April 12, 2019 and released April 16, 2019. CSIS/Beyond Parallel/DigitalGlobe 2019 via REUTERS

By David Brunnstrom

WASHINGTON (Reuters) – Satellite images from last week show movement at North Korea’s main nuclear site that could be associated with the reprocessing of radioactive material into bomb fuel, a U.S. think tank said on Tuesday.

Any new reprocessing activity would underscore the failure of a second summit between U.S. President Donald Trump and North Korean leader Kim Jong Un in Hanoi in late February to make progress toward North Korea’s denuclearization.

Washington’s Center for Strategic and International Studies said in a report that satellite imagery of North Korea’s Yongbyon nuclear site from April 12 showed five specialized railcars near its Uranium Enrichment Facility and Radiochemistry Laboratory.

It said their movement could indicate the transfer of radioactive material.

“In the past, these specialized railcars appear to have been associated with the movement of radioactive material or reprocessing campaigns.” the report said. “The current activity, along with their configurations, does not rule out their possible involvement in such activity, either before or after a reprocessing campaign.”

The U.S. State Department declined to comment on intelligence matters, but a source familiar with U.S. government assessments said that while U.S. experts thought the movements could possibly be related to reprocessing, they were doubtful it was significant nuclear activity.

Jenny Town, a North Korea expert at the Stimson Center think tank, said that if reprocessing was taking place, it would be a significant given U.S.-North Korean talks in the past year and the failure to reach an agreement on the future of Yongbyon in Hanoi.

“Because there wasn’t an agreement with North Korea on Yongbyon, it would be interesting timing if they were to have started something so quickly after Hanoi,” she said.

Trump has met Kim twice in the past year to try to persuade him to abandon a nuclear weapons program that threatens the United States, but progress so far has been scant.

The Hanoi talks collapsed after Trump proposed a “big deal” in which sanctions on North Korea would be lifted if it handed over all its nuclear weapons and fissile material to the United States. He rejected partial denuclearization steps offered by Kim, which included an offer to dismantle Yongbyon.

Although Kim has maintained a freeze in missile and nuclear tests since 2017, U.S. officials say North Korea has continued to produce fissile material that can be processed for use in bombs.

Last month, a senior North Korean official warned that Kim might rethink the test freeze unless Washington made concessions.

Last week, Kim said the Hanoi breakdown raised the risks of reviving tensions, adding that he was only interested in meeting Trump again if the United States came with the right attitude.

Kim said he would wait “till the end of this year” for the United States to decide to be more flexible. On Monday, Trump and his Secretary of State Mike Pompeo brushed aside this demand with Pompeo saying Kim should keep his promise to give up his nuclear weapons before then.

Town said any new reprocessing work at Yongbyon would emphasize the importance of the facility in North Korea’s nuclear program.

“It would underscore that it is an active facility that does increase North Korea’s fissile material stocks to increase its arsenal.”

A study by Stanford University’s Center for International Security and Cooperation released ahead of the Hanoi summit said North Korea had continued to produce bomb fuel in 2018 and may have produced enough in the past year to add as many as seven nuclear weapons to its arsenal.

Experts have estimated the size of North Korea’s nuclear arsenal at anywhere between 20 and 60 warheads.

(Reporting by David Brunnstrom and Mark Hosenball; Editing by Tom Brown and Grant McCool)