Benjamin Netanyahu says Israel's navy could act against Iran oil smuggling

The Israeli leader told naval officers that Iran was still resorting to clandestine measures to ship fuel and skirt sanctions

Israeli Prime Minister Benjamin Netanyahu delivers a speech at the launch of Likud party election campaign in Ramat Gan, Israel March 4, 2019. Reuters

Israeli Prime Minister Benjamin Netanyahu on Wednesday warned Iran that the country’s navy could launch operations against its oil smuggling operations.

Addressing Israeli naval officers, Mr Netanyahu called on the international community to prevent Tehran from evading US sanctions imposed last year by President Donald Trump after he withdrew Washington from the landmark nuclear deal signed with world powers in July 2015.

“Iran is trying to circumvent the sanctions through covert oil smuggling over maritime routes, and to the extent that these attempts widen, the navy will have a more important role in blocking these Iranian actions,” Mr Netanyahu said.

“I call on the entire international community to stop Iran's attempts to circumvent the sanctions by sea, and of course, by any (other) means.”

It was not clear how Israel would stop such shipping activities or whether it would risk direct confrontation at sea with Iranian vessels. The Israeli navy, whose largest vessels are missile corvettes and a small submarine fleet, is mostly active in the Mediterranean and Red seas.

According to maritime experts, Iranian oil smuggling methods have included changing the names of ships or flag registries, switching off location transponders on ships and conducting ship-to-ship transfers offshore and away from large trade hubs.

There was no immediate response from Tehran.

The sanctions placed on Iran by the United States have severely damaged its economy. It is now attempting to cushion that blow with a new trade channel to Europe that can circumvent those restrictions.

Iran hopes that it will be working within weeks, its deputy foreign minister said on Wednesday. France, Britain and Germany have set up the new mechanism for non-dollar trade with Iran in response to Washington's withdrawal from the agreement.

"We hope that in the coming weeks Instex would become operational," Iranian Deputy Foreign Minister Abbas Araqchi told reporters after a quarterly meeting of parties to the deal, referring to the mechanism's official name – the Instrument in Support of Trade Exchanges.

For that to happen, Iran must set up a counterparty to Instex that it can trade with. Mr Araqchi said he hoped that would be done before the Iranian new year, which is in two weeks.

Instex was conceived as a way to help match Iranian oil and gas exports with purchases of EU goods, but those ambitions have been toned down. Diplomats say that, realistically, it will be used only for smaller transactions such as purchases of humanitarian products or food.

Mr Araqchi disputed that, saying it could expand over time.

"This is for all goods and commodities, not only humanitarian goods," he said after meeting senior officials from Russia, China, France, Britain, Germany and the European Union.