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A war against Iran would be a war against a stretch of the world

A war against Iran would be a war against a stretch of the world

n Sunday, US national security adviser John Bolton announced that the USS Abraham Lincoln Carrier Strike Group and a bomber task force had begun to make their way from the Mediterranean Sea toward the Iranian coast. Iran, Bolton said, had made “a number of troubling and escalatory indications and warnings.”
He was, characteristically, not specific. It was enough that Bolton – who has a history of making hazardous statements – had made these comments from the perch of the White House in Washington, DC. “The United States is not seeking war with the Iranian regime,” he said rather unconvincingly. After all, what is the arrival of a massive war fleet on the coast of a country but a declaration of war?
On his way to Europe, US Secretary of State Mike Pompeo said the “indications and warnings” included actions by the Lebanese political organization Hezbollah. Once more, Pompeo said he would give no evidence. “I don’t want to talk about what [underlies] it.”
The journey of the USS Abraham Lincolnthrough the Red Sea comes as the US government tries to tighten its sanctions regime against Iran. Any country that buys Iranian oil, the United States now says, will be liable to have sanctions placed against it. The five countries most vulnerable to further US sanctions are China, India, Japan, South Korea and Turkey. India, Japan and South Korea have said they would try and abide by the new, and harsh, US sanctions. China and Turkey have made it clear that they will not follow the US lead.
Iran’s deputy oil minister Amir Hossein Zamaninia told Iranian state media that his ministry would oversee the sale of Iran’s oil into the “gray market.” The US sanctions, Zamaninia said, are “illegal,” and therefore Iran is entitled to use all kinds of methods to circumvent them.
The “gray market” includes loading tankers with Iranian oil – often sold at deep discounts – and then allowing them to alter their signals as they go out into open water. Congestion of tankers on the world’s waters makes it difficult to monitor which tanker has actually come from which port. But even if Iran sells oil on the gray market, the overall volumes will drop significantly, and this will impact Iran’s external revenues.
In April, the International Monetary Fund projected that Iran’s economy would likely slide by 6% in 2019. The main reason for this continued slide is of course the US-led sanctions that have whittled away at Iran’s budget and at the confidence of its people. Iran’s macroeconomic situation is hurt by large-scale budget deficits – projected to exceed US$14 billion this year – and the flooding of the market with Iranian rials – so that the money supply grew by more than 20%. Serious problems of capital flight and of tax evasion dog Iran’s prospects. Kazem Delkhosh, the deputy head of the Iranian parliament’s Economic Commission, estimates that about 40% of the country’s income is hidden from the tax authorities.
It did not help that last month Iran faced devastating floods in the country’s northeast and southwest. The damage is estimated to cost $2.5 billion. Countries that want to send financial support toward the flood victims cannot do so as a result of the US sanctions on financial systems, says the Iranian Red Crescent Society. This is why in-kind aid has been the only thing that has been permitted into the country, with China sending tents and Austria sending blankets.
But even in-kind aid, including from Saudi Arabia and the United Arab Emirates, was blocked by the US sanctions. Iranian Foreign Minister Javad Zarif wrote on Twitter, “Iranian Red Crescent can’t receive any funds due to illegal US sanctions. US should own up to its ECONOMIC TERRORISM.”