Iran Signals More Escalation With Warning on Gulf Violations

(Bloomberg) -- Iran is responsible for security in the Persian Gulf and is acting more vigorously to protect it, Foreign Minister Javad Zarif said, suggesting that a showdown between his country and Western powers over crucial shipping lanes could escalate.

“We used to overlook some violations but no longer,” Zarif said at a press conference at the Foreign Ministry in Tehran. Iran has the longest stretch of coastline with the waterway in the region and is responsible for its security, he added.

The remarks indicate that Iran could step up its operations against tankers passing through the Strait of Hormuz, the world's most important maritime chokepoint for oil, amid a confrontation with the U.S. over sanctions that have battered the Iranian economy.

On Sunday, the Islamic Republic said it had impounded a third vessel last month, a small oil tanker in the Persian Gulf it suspects of smuggling fuel. Iran's state-run Press TV reported that the ship impounded on July 31 was an Iraqi tanker, but Iraq denied that.

Iran began capturing vessels two weeks after U.K. forces seized an Iranian tanker on July 4 near Gibraltar.

Unraveling Deal

The drama in the region's waterways has been a dangerous sideshow to the broader confrontation that broke out last year after U.S. President Donald Trump quit the 2015 multipower nuclear deal with Iran and embarked on a crusade to bring Tehran to its knees by choking off the oil exports that are the lifeline of its economy.

In response, Iran has abandoned restrictions on uranium enrichment, downed a U.S. drone and test-fired a ballistic missile. It's also been accused of carrying out a number of attacks on tankers near the Strait of Hormuz, through which about one-third of the world's seaborne oil passes.

The U.S. administration has also imposed unprecedented sanctions against Iran's Supreme Leader Ali Khamenei, who has final say on all state matters. Last week, it also added Zarif to its sanctions list.

Zarif was asked to comment on a report in The New Yorker that he had been invited to meet with Trump in the White House last month, with Kentucky Senator Rand Paul extending the offer. He stopped short of denying the report, saying he never discloses details of his meetings.

He told reporters that it was his understanding that “Mr. Trump isn't after war,” but that National Security Adviser John Bolton and Israeli Prime Minister Benjamin Netanyahu are.

Broader Accord

Trump's declared aim is to negotiate a broader accord that would address elements the original deal did not include, such as Iran's ballistic missile program and its support for militant groups in the region such as Lebanon's Hezbollah. Zarif rejected the notion that the U.S. is interested in diplomacy, saying Washington can't expect Tehran to engage in negotiations as long as it engages in “economic terrorism.”

“We had hundreds of hours of negotiations with Americans,” he said. “We are not against talks, but we've had talks already -- maybe the Americans have idle time, but we don't.”

Iran's plan to continue scaling back its commitment to the nuclear deal is not the same as leaving it, but its next step in reducing compliance won't be its last, Zarif added, saying the European Union “can't cite U.S. sanctions for not meeting obligations.”

European powers have been working with Iran to try to salvage the accord, but haven't come up with a mechanism that would allow Tehran to skirt the U.S. sanctions on its oil.

To contact the reporters on this story: Benjamin Harvey in Istanbul at bharvey11@bloomberg.net;Arsalan Shahla in Tehran at ashahla@bloomberg.net

To contact the editors responsible for this story: Benjamin Harvey at bharvey11@bloomberg.net, ;Alaa Shahine at asalha@bloomberg.net, Amy Teibel

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