Background Briefing on Further Sanctions Under the Iran Sanctions Act

Special Briefing
Senior State Department Official
Via Teleconference
Washington, DC
August 10, 2012

MODERATOR: Good afternoon, everyone. Today we have [Senior Administration Official]. This call will be on background, attributable to a Senior Administration Official. [Senior Administration Official] will start out the call with a few remarks, and then we can go into some Q&A. We do have a limited amount of time, but we’ll try and get through as many questions as we can.

With that, let me turn it over to [Senior Administration Official].

SENIOR ADMINISTRATION OFFICIAL: Thanks, [Moderator], and thanks for everyone for calling in for this this afternoon. I know we’re getting late on a Friday afternoon in August, so I’m going to try and keep these remarks brief.

As I know you’ve seen from the statement that went out a couple of hours ago, today the Administration has imposed sanctions on the Syrian state-run oil company Sytrol under the Iran Sanctions Act as that act has been amended over the years by the Comprehensive Iran Sanctions Accountability and Divestment Act. These sanctions are because of transactions that Sytrol engaged in with Iran’s energy sector, and I think the action we’re taking today highlights the really serious concerns that the United States has about the close ties shared by the Iranian and Syrian regimes and the fact that we, the United States, are committed to using every tool available to prevent regional destabilization.

In April of this year, Syria and Iran engaged in a two-way trade in the energy sector in which Syria sent 33,000 metric tons of gasoline to Iran. The United States has determined that the value of that gasoline that was delivered by Sytrol to Iran this last April was over 36 million, which significantly exceeds the thresholds needed to trigger sanctions under the applicable laws.

This kind of trade is allowing Iran to continue developing its nuclear program while providing the Syrian Government with the resources it needs to oppress the Syrian people during the continuing and ongoing serious violence in Syria today. And although these sanctions – the specific action we’re taking today is a direct result of Syria’s provision of gasoline to Iran and the reciprocal trade Iran provided to Syria, the United States views Iran’s broader support for the Assad regime as completely unjustifiable and unacceptable. Iran is actively advising, supplying, and assisting the Syrian security forces and regime-backed militias that are carrying out gross human rights abuses against the Syrian people and is also providing the Assad regime with equipment to monitor opposition activity on the internet.

Iranian officials, as many of you know, have boasted about Iran’s support to the Assad regime, and Iran’s actions in Syria underscore its fear of losing its primary remaining ally in the Middle East and an important conduit to Hezbollah. And I know many of you were probably on the call earlier today in which Under Secretary David Cohen and Assistant Secretary Dan Benjamin were discussing actions we took against Hezbollah earlier today.

Today’s actions against Sytrol send a stark message: The United States stands resolutely against sales of refined petroleum product to Iran, and more broadly that we, the United States, take any business that continues to support Iran’s energy sector and continues to support the Assad regime, or that helps facilitate either nation’s efforts to evade U.S. and international sanctions, is going to face very serious consequences.

I think you all saw the release earlier today. And I think with that overview, let me turn it over for questions.

OPERATOR: Thank you. Ladies and gentlemen, we will now begin the question-and-answer session. If you would like to ask a question, please press * then 1 on your telephone keypad. You will hear a tone indicating that you’ve been placed in queue. You may remove yourself from queue at any time by pressing the # key. Once again, if you would like to ask a question, please press *1 at this time.

The first question is from the line of Margaret Brennan with CBS News. Please go ahead with your question.

QUESTION: Hi. Good afternoon. With Iran’s sale of oil, there are still allies of the U.S. that are consuming it. So can you draw some line here that explains what’s different between trade in Iran – between Syria and Iran and countries like Japan and the Koreas and India that are continuing to consume and do business with Iran when it comes to their petroleum production?

SENIOR ADMINISTRATION OFFICIAL: Let me just maybe just clarify the specific action that we’re imposing sanctions on today was for a transfer of 33,000 metric tons of gasoline from Syria to Iran. But really the broader purpose, or one of the major purposes here, is to draw broad attention to the really serious and deep relationships between the Iranian and Syrian regimes and the support that the Iranian regime has been providing to the Syrian Government. While Syria was transferring gasoline to Iran, Iran was transferring diesel in return to Syria, diesel which obviously the regime has been using – diesel is a major fuel that the regime uses to help fuel its own equipment and supplies. So we take this trade very, very seriously.

We could take follow-up questions at some point directed to PA about the broader issues related to the NDAA sanctions on the petroleum sector. But broadly, as you know, Margaret, we are working with countries around the world to reduce their purchases of Iranian crude and encourage all countries around the world to apply – abide by U.S. sanctions and to reduce their purchases of Iranian crude and other petroleum products.

OPERATOR: The next question is from the line of Rachelle Younglai from Reuters. Please go ahead.

QUESTION: Hi. I’m wondering what the –

OPERATOR: One moment, please. Ms. Younglai, please go ahead with your question.

QUESTION: Hi. What do these sanctions –

MODERATOR: All right. I think we’re having a –

OPERATOR: Ms. Younglai, please repeat your question.

QUESTION: Can you hear me?

MODERATOR: Yes. Why don’t you give it one more try?

QUESTION: Okay. I’m wondering what these sanctions against petrol do. I mean, what are the new penalties against petrol?

SENIOR ADMINISTRATION OFFICIAL: Absolutely, so under the Iran Sanctions Act, we are required to apply three of nine different sanctions. In this case, we – because of the seriousness of this particular issue, we applied the three most aggressive sanctions authorized under the act. We’ve blocked all banking transactions subject to U.S. jurisdiction that have any Sytrol interest in them, blocked all property transactions subject to U.S. jurisdiction in which Sytrol has any interest. And we’ve also blocked any procurement by the U.S. Government of anything from Sytrol.

So I think we’ve both taken very serious substantive action against Sytrol. I also think, at least as importantly with the action we’re taking today, we’re sending a message to companies around the world – not just in the United States but to companies around the world – about the seriousness with which the United States treats the Iran-Syria trade, the seriousness with which the U.S. takes the actions going on in Syria, and we’re sending a message to companies around the world that they really need to be not doing business with Sytrol as an entity, and they need to be winding down their support for the Assad regime.

OPERATOR: The next question is from the line of George Russell with Fox News. Please go ahead with your question.

QUESTION: Hi. I wonder if you can tell me what kind of capabilities the Iranians are giving the Syrians for surveillance on the internet that they don’t already have?

SENIOR ADMINISTRATION OFFICIAL: Thanks. As you know, I can’t comment on ongoing investigations, and I also have to be cognizant of the different intelligence equities, and can’t comment on things that we can’t say publicly, obviously.

Let me just talk a little bit about that – the broader issue there, which is that the U.S. remains and is quite concerned about the provision of technology to both the Syrian and the Iranian Government that those governments can use to monitor and track individuals in Iran and Syria in order to commit human rights abuses against those individuals. Last April, we rolled out an executive order – the Administration rolled out an executive order, the gravity executive order, which targets the provision of technology to either the Government of Iran or the Government of Syria that those governments can use to monitor, track, or otherwise surveil people in Iran and Syria with – that surveillance for monitoring and tracking can then be used to commit serious human rights abuses against those people. And we take these authorities very seriously, and we take all allegations about the transfer of this kind of technology quite seriously. Obviously, I can’t comment on any current pending investigations.

OPERATOR: The next question is from the line of David Ivanovich with Argus Media. Please go ahead with your question.

QUESTION: Hi. Good afternoon. We had the President issue an executive order a year ago regarding imports of Syrian oil in into the U.S. and barring U.S. persons from engaging in transactions with – regarding Syrian oil. So I’m having a hard time understanding what the real-world differences are between those sanctions and what’s happening today.

SENIOR ADMINISTRATION OFFICIAL: So Sytrol is a state-owned and state-run oil company in Syria, and last year, as you know, the U.S. enacted sanctions that imposed broad sanctions on the Government of Syria and took that action this year. I think really with the action we’re taking today, in addition to – as I mentioned earlier, in addition to drawing attention to and focusing on the important support that Iran is providing the Syrian regime, I think we’re also sending a very clear message by designating Sytrol specifically for this action to companies around the world that they shouldn’t be doing business, not just companies within the United States and subject to our laws, but to companies around the world that they shouldn’t be doing business with Sytrol, that they run very serious both reputational and business risks if they continue that business with Sytrol or providing other support to other Assad regime elements.

MODERATOR: I think we’ve got time for maybe one more question.

OPERATOR: Thank you. And we have a follow-up question from the line of Margaret Brennan with CBS News. Please go ahead with your question.

QUESTION: Yeah. To follow up on the who’s purchasing question, I mean, if it’s not the U.S., is this also a message that’s intended to be directed toward European customers? I mean, who is actually out there actively supporting as customers this company?

SENIOR ADMINISTRATION OFFICIAL: We’ve worked closely with the Europeans on a variety of sanctions issues, and the Europeans have also been in the process of ending purchases of petroleum from Sytrol. So this is really, as I said, a designation that is intended to send a signal to companies around the world, any companies around the world that are thinking about trying to engage in business with Sytrol, that they’re going to be running very serious risks if they do so.

MODERATOR: Thank you, everyone, for joining. I appreciate you participating in this call. If you have any other further questions, please don’t hesitate to call us here at the Press Office, and we’ll follow up for you.

PRN: 2012/1293