Oil prices may lift as EU hit Iran with new oil santions

Oil prices may see a lift this week as the EU hit Iran with new and tough sanctions against its vital oil industry today in a bid to lure Iran back to the negotiating table over its disputed nuclear program.

EU foreign ministers will formally approve the sanctions on today following Iran’s repeated refusals to halt sensitive nuclear activities.

Iranian President Mahmoud Ahmadinejad warned the EU against imposing unilateral sanctions, saying Tehran would react swiftly and cause “remorse”.

“We do not welcome any tension or a new resolution. We seek logic and friendship. I should tell you that anyone who adopts a measure against the Iranian nation, such as inspection of our ships and planes, should know that Iran will react swiftly. Experience shows that such a reaction by the Iranian nation will cause remorse to it (the EU).”” Ahmadinejad said in remarks directed at the EU.

Meanwhile, Iran has signed a $1.3 billion pipeline deal to export gas to Turkey, according to the country’s Oil Ministry. The Turkish government denied that was involved with the deal. A firm called Som Petrol, Turkey’s largest energy company, said it was Iran’s partner.

This latest move by Iran is likely to irritate the US and the EU as Turkey is currently not a member of the European Union and santions by the EU would not affect deals on Turkish soil.