US nears new Iran bank sanctions

WASHINGTON (AP) ? The Obama administration has given in to legislation that would apply sanctions on Iran’s Central Bank, despite weeks of opposition over concerns the measures may drive up oil prices or inflict severe economic hardship on American partners overseas.

State Department spokeswoman Victoria Nuland said Thursday that U.S. officials were looking at how to implement the sanctions in way that “maximizes the pressure on Iran while causing minimum disruption for friends and allies of the U.S.”

The administration had opposed the defense bill amendment, despite its unanimous Senate support. It also passed the House on Wednesday.

Several U.S. allies in Europe and Asia import petroleum from Iran, and to do so their banks and companies must conduct transactions through the Iranian Central Bank. The new bill could compel U.S. punishment of foreign financial institutions that maintain such business.

The administration had also expressed concern the sanctions could lead to a spike in global oil prices, hampering the American economic recovery and perhaps perversely enabling Iran to reap even greater revenues from its oil exports. That would then defeat the purpose of the bill, which is to hamper Tehran’s alleged support for international terrorism and ability to fund its nuclear enrichment program.

Several changes were added to the bill to give the administration greater flexibility, and Nuland declined to repeat any of the administration’s previous objections on Thursday.

The sanctions wouldn’t come into effect until six months after the bill is signed, and would allow the president to waive the penalties for national security reasons.