UPDATE 1-US: Sanctions cost Iran investment, banking access

(Adds State Dept. official on energy investments)

WASHINGTON, Dec 1 (BestGrowthStock) – Iran is finding it
increasingly difficult to access the financial services it
needs to run its economy and may lose up to $60 billion in
energy investments due to global sanctions, U.S. officials said
on Wednesday.

The officials told U.S. lawmakers that United
Nations-backed sanctions imposed over the summer are inflicting
economic pain on Tehran and hampering its drive to develop
nuclear weapons.

“With great regularity, major companies are announcing that
they have curtailed or completely pulled out of business
dealings with Iran,” Stuart Levey, U.S. Treasury undersecretary
undersecretary for terrorism and financial intelligence, told
the House of Representatives Committee on Foreign Affairs.

“And, as has been widely reported, Iran’s leadership
appears to have underestimated the severity and effects of the
global financial measures, giving rise to internal Iranian
criticism and finger-pointing,” Levey added.

Levey said the sanctions were restricting Iran’s access to
dollars and were the likey cause of a nearly 20 percent plunge
in Iran’s rial currency in September, prompting weeks of
intervention from Iran’s central bank to stabilize it.

A U.N. Security Council resolution calling for increased
sanctions to curb Iran’s nuclear and missile activities paved
the way for tougher U.S. and European Union measures to cut off
financial services and energy sector investment from Iran.

ENERGY INVESTMENT LOST

Undersecretary of State William Burns told the panel Iran
may lose $50 billion to $60 billion in potential energy
investments, along with critical technology and know-how from
major international companies.

“Sanctions have hindered Iran’s development of
a nuclear weapons capability and the means to deliver them,
while making it harder for Iran to continue its destabilizing
activities in the region,” Burns said in prepared remarks.

Burns said there is still time for diplomacy with Iran over
its nuclear programs and that the door to serious talks is open
if Iran will walk through it.

Seventeen Iranian banks are now blacklisted by most major
financial centers and the United States has passed a law that
effectively forces international financial institutions to
choose between doing business with Iran or the United States.

A few years ago, Iran was able to deal with the world’s
largest and most prestigious banks, Levey said, but today it is
“relegated to the margins of the international financial
system, and is finding it increasingly difficult to access the
large-scale, sophisticated financial services necessary to run
a modern economy efficiently.”

The Treasury has heavily targeted the Islamic Republic of
Iran Shipping Lines with sanctions for transporting
weapons-related materials.

Levey said that a few months ago, France’s Credit Agricole
Corporate & Investment Bank (CAGR.PA: ) seized three IRISL ships
in Singapore because Iran could not purchase insurance for the
vessels, violating terms of a $235 million loan agreement.

But Levey said that despite the impact on Iran, he was
confident that Iran would continue to try to evade sanctions,
so the United States must remain vigilant and intensify its
efforts.
(Reporting by David Lawder and Thomas Ferraro and Arshad
Mohammed; Editing by Doina Chiacu)

UPDATE 1-US: Sanctions cost Iran investment, banking access