A new law imposing further sanctions against Iran was signed by U.S. President Barack Obama on Saturday. The new sanctions are intended to dissuade foreign banks from dealing with Iran's Central Bank.
Obama has signed a new law imposing fresh economic sanctions against Iran's Central Bank. The president took time out of his Hawaii vacation to sign the new law on Dec 31, 2011. Thus, the New Year begins with the threat of an increased escalation of tension between Iran and the West.
According to AFP, the sanctions were included in Obama's $662-billion defense bill, and the section dealing with Iran is intended to punish the country for having a nuclear program.
"The sanctions are meant to hit Iran's crucial oil sector and require foreign firms to make a choice between doing business with Tehran's financial sector and central bank or the mighty US economy and financial sector," AFP reporter Stephen Collinson writes.
The U.S. has already imposed sanctions against banks in America dealing with Iran's Central Bank, but the new law is intended to "dissuade other foreign banks from doing transactions with Iran's Central Bank by threatening to cut off their access to U.S. financial institutions," Press TV reports.
This latest move follows sanctions imposed on Iran by the UK and Canada. ABC reports the new law could damage American ties with China and Russia and could well alienate U.S. foreign allies who may resent American demands.
Obama was apparently cautious about imposing stricter sanctions on Iran and he included a clause that allows for a waiver to be used if he decides sanctions will jeopardize U.S. interests.
The imposition of further sanctions against Iran are predicted to increase the price of oil. Fars News Agency reported Iranian Oil Minister Rostam Qassemi warned, "Sanctions on Iran's oil will drive up the price of oil to at least 200 dollar per barrel."