Iran vows to resist sanctions `warfare`

Iranian officials equated the financial pressure to "warfare" and vowing to counter by retooling the country`s oil-dependent economy.

Last Updated: Aug 01, 2012, 12:01 PM IST

Tehran: Iranian officials unleashed sharper attacks against tightening Western sanctions on Tuesday, equating the financial pressure to "warfare" and vowing to counter by retooling the country`s oil-dependent economy.

The defensive remarks from President Mahmoud Ahmadinejad and the head of Iran`s central bank appear to reflect two sides of the economic squeeze on the country: Growing anxiety about the drain from sanctions and high-level efforts to find ways to ride them out.

Ahmadinejad`s remarks came after Congress pressed ahead yesterday with a new package of sanctions on Iran, expanding financial penalties and further targeting Tehran`s energy and shipping sectors in the hope that economic pressure will undercut the country`s suspected nuclear weapons programme.

Iran denies it seeks atomic weapons, saying its nuclear activities have aimed at power generation and cancer treatment.

Iran has managed to overcome US-led embargoes and other attempts at economic isolation with self-sufficiency moves such as developing domestic industries and emphasising high-tech advances including an aerospace programme.

But the current sanctions are hitting Iran in its most vulnerable spot -- its vital oil exports -- and are forcing major reassessments within a nation that was recently OPEC`s No 2 exporter.

Ahmadinejad, speaking at an expansion of an oil refinery facility in Tehran, echoed calls for Iran to move away from crude oil export as its mainstay and heavily invest in networks to produce car-ready fuels and other petrochemical products. A similar call was made earlier this week by Supreme Leader Ayatollah Ali Khamenei.

Their comments mark an indirect acknowledgment that oil exports -- accounting for 80 per cent of Iran`s foreign revenue -- are a weak link now targeted by Western sanctions seeking to rein in Iran`s nuclear programme.

The drop in oil sales from sanctions also means less money to buy the fuel and other products needed for consumers and businesses.

Officials are particularly worried about potential shortages of some food items and protests with elections for Ahmadinejad`s successor less than 11 months away.

Local media have been warned against reports on the sanctions` fallout that could "harm" national interests. The government also has already begun to stockpile needed foodstuffs such as wheat, meat, sugar and cooking oil.

Ahmadinejad called the sanctions "political warfare" seeking to deny Iranian oil to an energy-hungry world.

"It`s very funny. They (the West) use oil as a political weapon against a country that is an oil producer itself," Ahmadinejad said in a speech broadcast on state TV.