U.S. downplays Iran warnings on Straits of Hormuz

Laura Rozen

American officials on Wednesday downplayed comments by two Iran officials in recent days warning that Iran could close the critical Straits of Hormuz to retaliate against further economic sanctions targeting its oil exports. But analysts said the comments reflect growing Iranian anxiety over economic hardship and could signal risk for miscalculation that could lead to confrontation.

"I think it's more rhetoric from the Iranians," State Department spokesman Mark Toner told journalists Wednesday. "We've seen... these kinds of comments before on the part of the Iranians."

"Anyone who threatens to disrupt freedom of navigation in an international strait is clearly outside the community of nations," said Lt. Rebecca Rebarich, a spokeswoman for the U.S. Navy's Fifth Fleet, based in Bahrain, in a statement, according to the Associated Press. "Any disruption will not be tolerated."

On Wednesday, Iran's top naval commander boasted of Iran's ability to control the critical energy transport hub--while saying it had no plans to block it.

"Closing the Strait of Hormuz for Iran's armed forces is really easy ... or, as Iranians say, it will be easier than drinking a glass of water," Iran Navy Rear Admiral Habibollah Sayyari was cited by Iran's Press TV, the Los Angeles Times reported. "But right now, we don't need to shut it as we have the Sea of Oman under control, and we can control the transit."

His comments followed those of Iranian Vice President Mohammad Reza-Rahimi Tuesday, warning that if western nations move to "impose sanctions on Iran's oil exports, then even one drop of oil cannot flow from the Strait of Hormuz."

Iran experts noted however that Reza-Rahimi is currently facing a corruption investigation by Iran's Judiciary and is in no position anyhow to make such a call. Iranian foreign ministry and military officials had since moved to distance themselves from the comments, they said.

The comments reflect the Iranian regime's growing anxiety about prospective new American and European sanctions on Iran's Central Bank, as well as the toll of economic sanctions already in place, including the recent sharp drop in the Iranian currency, analysts said.

The value of Iran's currency has been falling, "which is usually an indication of a number of things," a U.S. administration official who requested anonymity told Yahoo News Wednesday. "One, the population is losing confidence in the government. Two, the government is running out of foreign reserves. It is having a hard time getting reserves so it cannot [take measures] to keep the currency from falling apart."

The Iranian comments over the Straits of Hormuz come after Congress sent legislation to the White House earlier this month as part of a defense authorization bill that would sanction banks that do business with Iran's Central Bank--a key institution for Iran to secure revenues for its oil exports, primarily to Asia. Iran is the fourth largest oil producer in the world.

European officials, led by France and the United Kingdom, have also discussed the possibility of imposing some sort of an embargo on European import of Iranian oil.

U.S. officials have recently traveled to China and Saudi Arabia to continue discussions about how to prevent possible shocks to the energy markets that might occur if there is a reduction in Iranian oil exports. The Obama administration has set up an Iran energy inter-agency group that includes Deputy Energy Secretary Dan Ponneman, Treasury Undersecretary for Terrorism and Financial Intelligence David Cohen, and acting Assistant Secretary of State for Energy Resources Carlos Pascual, among others, officials said.

Iran would be more likely to act indirectly rather than directly against the United States or its interests in the region, senior military analyst Anthony Cordesman of the Center for Strategic and International Studies told Yahoo News in an interview Wednesday.

"Certainly, we are a watching a steady increase in Iran's asymmetric capabilities that reflect the weaknesses in the modernization of its conventional forces," he said (and which are described in detail in a new report he co-authored, Iran and the Gulf Military Balance.)

"One has to be very careful," in such a scenario, Cordesman continued. "If Iran [undeclaredly] releases mines in the [Persian] Gulf, it would send a signal--and would be harder to deal with--than declaring war against the U.S. and its Gulf neighbors. It would increase tanker premiums, and there is no easy simple way to counter it. It could use such exercises to try to shut down shipping routes without saying it was launching a military confrontation."

There could also be "an attack on a tanker by an unmarked naval ship," Cordesman continued. "Deniability doesn't have to be plausible--just workable."

Despite the day's focus on the Iranian comments, crude oil futures fell Wednesday, closing below $100, the Wall Street Journal reported.

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