Israel's Tehran connection

Richard Silverstein

April 4, 2008 12:00 PM

If you've ever wondered about the definition of hypocrisy you'll find the answer right here.

Last month the Swiss foreign minister visited Iran and, together with President Ahmadinejad, attended the signing of a multi-billion euro contract for Iran to supply Switzerland with large amounts of natural gas over the next 25 years.

The US State Department immediately condemned the deal and said it would be investigating whether it breached the Iran Sanctions Act. Israel complained too, describing the Swiss minister's visit to Tehran as an "act unfriendly to Israel". Various Jewish groups also joined in the protests, including the World Jewish Congress.

This righteous indignation was entirely predictable but more than a little odd nevertheless. On March 30, the Swiss newspaper Sonntag retaliated with the revelation that Israel, supposedly observing an ironclad boycott of all things Iranian, has been buying Iranian oil for years.

The story is in German but Israeli journalist Shraga Elam has provided me with a translation which I'll quote from here.

"Israel imports Iranian oil on a large scale even though contacts with Iran and purchasing of its products are officially boycotted by Israel. Israel gets around the boycott by having the oil delivered via Europe. A reliable Israeli energy newsletter, EnergiaNews, reported this last week [March 18] ...

"EnergiaNews got the information about the Iran trade from sources with ties to the management of Israeli Oil Refineries Ltd ... According to EnergiaNews the Iranian oil is liked in Israel because its quality is better than other crude oils.

"The report by EnergiaNews editor Moshe Shalev states that the Iranian oil reaches various European ports, mainly in Rotterdam. It is bought by Israelis and the necessary European bill of lading and insurance papers are supplied. Then it is transported to Haifa in Israel. The importer is the Eilat-Ashkelon Pipeline Co (EAPC), which keeps its oil sources secret."

EAPC was established in 1968 as a joint Israeli-Iranian company to transport oil from Iran to Europe. After the fall of the Shah, Iran ceased to play an active role in its affairs and there are ongoing legal disputes between the two partners.

The Swiss report continued:

"It is not clear if the Iranian exporters know about Israeli purchases of their oil. At the other end, the Israeli buyers and governmental offices are well aware of where the high-grade oil comes from, although it is a blatant defiance of the boycott. The EnergiaNews article even made it through Israeli censorship, which asked only for some changes in the text. The fact that the report cleared the censors increases the credibility of the information. In the past, such reports were forbidden.

"When questioned by Sonntag, an energy expert of one of the leading Israeli papers confirmed the EnergiaNews report: Israel has been importing Iranian oil for many years. The expert stressed, however, that the purchases were made on the free market and not directly from Iran."

Sonntag quoted a spokesman for Oil Refineries Ltd as denying that his company imports and processes Iranian oil. However, Sonntag pointed to a report in Haaretz newspaper last October which said that an Israeli energy company called Paz would be refining Iranian oil and supplying it to the Palestinian Authority from the start of this year.

This begs the question: if Iran is, as Bibi Netanyahu argues, an existential threat to Israel, why does the government allow such trade? Would Israel have the US attack Iran's nuclear programme and provoke a potential region-wide conflict while it cannot seem to wean itself from high quality Iranian crude? You'd think if Israelis are cowering in fear from an Iranian bomb and the arch antisemite Ahmadinejad, they wouldn't want to trade with such an enemy.

When is a boycott not a boycott? When it's in your naked economic interest to circumvent it, apparently. But one should ask: if Israel doesn't honour its self-declared boycott of Iran, why should the rest of the world honour its boycott of Hamas and Gaza? If Israel doesn't honour its own boycott, then why should members of Congress vote with AIPAC when it proposes a measure that even Israel honours only in the breach?

It's interesting to note from a discussion (in Hebrew) on the Kedma website that Israel does not formally define Iran as an "enemy nation" and therefore in a strictly legal sense such trade is permissible. Ironically, Iran too has a boycott against Israel in place and is violating its own measures in that regard. Furthermore, the same commenter notes that Israel last week dismissed attempts to engage Syria in a diplomatic process as a failure because Syria refuses to renounce its ties with Iran. Do I hear the word "hypocrisy"?

Swiss reject terror sponsor charge by US Jewish group

By Stephanie Nebehay
GENEVA, April 8 (Reuters) - Switzerland rejected accusations on Tuesday by the U.S.-based Anti-Defamation League (ADL) that it could be financing terrorism after a Swiss company clinched a multi-billion euro (dollar) deal to buy natural gas from Iran.
The Swiss Foreign Ministry reiterated that the purchase did not violate U.N. Security Council resolutions imposing sanctions on Iran over its nuclear programme or U.S. domestic law.
The American Jewish group's full-page advertisement -- which follows a complaint lodged by Israel with Switzerland over the deal -- appeared on Tuesday in newspapers under the banner "Guess who is the world's newest financier of terrorism? SWITZERLAND".
"The reproaches in this advertisement do not correspond to the facts," Swiss Foreign Ministry spokesman Lars Knuchel said.
The ad -- which ran in the International Herald Tribune, the leading Swiss financial daily Neue Zuercher Zeitung and Geneva daily Le Temps -- said the deal's "likely result" was Hamas and Hezbollah "may get tens of thousands of additional missiles".
Both Hezbollah, the Shi'ite Muslim movement in Lebanon, and the Palestinian Islamist group Hamas which seized control of the Gaza Strip last year, are pro-Iranian parties.
U.S. President George W. Bush has accused Shi'ite Muslim Iran of being "the world's leading state sponsor of terror" and of undermining peace by supporting Hezbollah and Hamas.
The United States has led international efforts to penalise Iran for failing to allay suspicions that it is seeking nuclear weapons and has been urging other countries to cut trade ties.
The ad said that the contract, signed during a Tehran visit last month by Swiss Foreign Minister Micheline Calmy-Rey, would enable Iran to accelerate and complete its nuclear programme.
"Terrorist cells in Europe, the Middle East and around the globe will have access to new weapons and support," it said. "When you finance a terrorist state, you finance terrorism."
The Swiss energy group Elektrizitaetsgesellschaft Laufenburg (EGL) has said its 25-year deal with the National Iranian Gas Export Company was worth between 10 billion euros ($15.73 billion) and 22 billion euros, depending on several factors such as the price of oil.
Calmy-Rey, whose neutral country has worked in the past to find a compromise in the nuclear row, said in Tehran that the deal was important in the long term for both parties.
"This business transaction between the EGL and NIGEC is fully in line with the U.N. sanctions against Iran as well as with the U.S. Iranian Sanctions Act," Knuchel said on Tuesday.
Asked whether the deal might jeopardise neutral Switzerland's role in handling U.S. interests in Iran, as it has done since the 1979 revolution, he said a State Department spokesman had said last week there was no change in U.S. policy.
The Swiss foreign ministry also pointed out that other powers including the European Union (EU), China and Japan were doing business with the Islamic Republic. (Editing by Jonathan Lynn and Charles Dick)