Petrol wars: Iran threatens to blockade Gulf oil exports over US sanctions

Iran's President Hassan Rouhani vowed to cut off international oil sales from the Gulf on Tuesday, striking a defiant stance against US sanctions.

"America should know... it is not capable of preventing the export of Iran's oil," Rouhani said at a televised rally in Semnan province.

"If it ever tries to do so... no oil will be exported from the Persian Gulf," he added.

Since the 1980s, Iran has repeatedly said it would blockade the Gulf in response to international pressure but has never carried out such a threat. 

Washington has reimposed sanctions, including an oil embargo, since withdrawing from a landmark 2015 nuclear deal between Tehran and major powers in May.  

It has vowed to reduce Iran's oil sales to zero, but has granted temporary waivers to eight countries.

Rouhani last threatened to close the Gulf in July when he warned the US "should not play with the lion's tail".

Iran's president downplayed the economic impact of sanctions, accusing the media of exaggerating the country's problems.

"No hyperinflation, no massive unemployment will threaten us. People should stop saying such things in the papers," he told the crowd. 

The latest inflation report from Iran's central bank says food prices rose 56 percent year-on-year in October. 

Rouhani acknowledged there were "some problems", but said these would be addressed in the new budget plan to be presented on December 16. 

He said the government would maintain subsidies on essential goods and increase public sector wages and pensions by 20 percent.

On Monday, the United States urged the European Union to apply sanctions targeting Iran's ballistic missile programme, calling it a "grave and escalating threat".

It is a grave and escalating threat, and nations around the world, not just Europe, need to do everything they can to be targeting Iran's missile programme

Over the weekend, US Secretary of State Mike Pompeo said that Iran tested a medium-range missile capable of carrying multiple warheads and striking parts of Europe and the entire Middle East.

Pompeo, who also met with Israeli Prime Minister Binyamin Netanyahu in Brussels on the fringes of a NATO summit on Monday, said the test violated UN Security Council Resolution 2231, which endorsed the Iran nuclear deal signed by world powers with the Islamic republic.

In Paris, the French foreign ministry also condemned the Iranian missile test as "provocative and destabilising", and noted that it was not in compliance with the UN resolution.

France "calls on Iran to immediately cease all activity linked to ballistic missiles conceived to carry nuclear weapons, including all launches using ballistic missile technology", it said.

Washington's Iran special envoy Brian Hook insisted that, despite Tehran's assertions to the contrary, Iran's missile tests were not defensive in nature.

"We would like to see the European Union move sanctions that target Iran's missile programme," Hook told reporters aboard Pompeo's plane as he travelled to Brussels.

Hook said President Donald Trump's campaign of "maximum pressure" on Tehran since withdrawing from the Iran nuclear deal "can be effective if more nations can join us in those [sanctions]."

"It is a grave and escalating threat, and nations around the world, not just Europe, need to do everything they can to be targeting Iran's missile programme," he added.

Hook said "progress" was being made on getting NATO allies to consider a proposal to target individuals and entities that play key roles in Iran's missile development.

But Iran defended its controversial missile programme describing it as "defensive", after the US accused it of test-firing a rocket capable of hitting Europe.

Tehran's foreign ministry said its missile arsenal did not break international law, despite the US slapping more sanctions on Iran over the programme.

"Iran's missile programme is defensive in nature... There is no Security Council resolution prohibiting the missile programme and missile tests by Iran," IRNA quoted Foreign Ministry spokesman Bahram Qasemi as saying.

Iran did not confirm or deny that it carried out a missile test, but Tehran has insisted it is not pursuing nuclear weapons and the missiles and not designed to carry nukes.

EU countries have denounced the move and are working to preserve the nuclear deal, even though they have also criticised Iranian positions on other matters.

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