Bill Would Give President Power To Sanction Foreign Oil Cos On Iran

U.S. President Barack Obama would have new authority to sanction foreign firms that sell gasoline and other oil products to Iran under legislation introduced Tuesday by a bipartisan group of 25 U.S. senators seeking to halt Iran's push to develop nuclear weaponry.

If the bill becomes law, the U.S. president would have clear authority to impose economic sanctions on foreign firms that sell, ship or insure gasoline or other refined oil products to Iran. Foreign subsidiaries of U.S. firms also would be covered by the proposed legislation.

Oil-rich Iran imports 40% of its gasoline from companies such as British Petroleum, Reliance, Royal Dutch Shell PLC (RDSA) and Vitol, so "this is the best leverage we have" over it, Sen. Evan Bayh, D-Ind., said at a press conference to unveil the legislation.

Iran is believed to be two to four years away from becoming a nuclear-armed power, and U.S. lawmakers hope the prospect of punishing sanctions on gasoline importers will convince Iran's government to abandon its nuclear ambitions.

The U.S. already has the ability to sanction firms doing business with Iran, but the president's authority would be stronger and more precise under the proposed bill, said Sen. Jon Kyl, R-Ariz.

Kyl said the bill gives firms that import gasoline or other oil products to Iran a clear choice - do business with the $13 trillion U.S. economy, or with Iran's $250 billion economy, but not both.

Sen. Joseph Lieberman, I-Conn., said the bill would clarify "ambiguous" U.S. presidential authority to sanction firms that supply Iran with gasoline, giving the president "a powerful new tool to use" in negotiations with Iran.

The bill is expected to be considered by the Senate Banking Committee before being brought to the full Senate. The committee's chairman, Sen. Christopher Dodd, D-Conn., is not a co-sponsor of the bill but Lieberman said Dodd is generally supportive of it.

- By Judith Burns, Dow Jones Newswires, (202) 862-6692; Judith.burns@dowjones.com

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