Assets of Iranian central bank frozen - Rial plunges to record low BRUSSELS/LONDON — Oil prices rose Monday after the European Union slapped an embargo against Iran's crude exports. Brent North Sea crude for delivery in March climbed 77 cents to $110.63 a barrel in London midday deals after the widely-expected move by the EU. New York's main contract, West Texas Intermediate crude for March, rose 88 cents to $99.21 a barrel. The European Union also imposed a number of other economic sanctions, joining the United States in a new round of measures aimed at deflecting Tehran's nuclear development program. In Iran, one politician responded by renewing a threat to blockade the Strait of Hormuz, an oil exporting route vital to the global economy, and another said Tehran should cut off oil to the EU immediately. That might hurt Greece, Italy and other ailing economies which depend heavily on Iranian crude and, as a result, won as part of the EU agreement a grace period until July 1 before the embargo takes full effect. A day after a US aircraft carrier, accompanied by a flotilla that included French and British warships, made a symbolically loaded voyage into the Gulf in defiance of Iranian hostility, the EU move was likely to set off further bellicose rhetoric in an already tense region. Meeting in Brussels, foreign ministers from the 27-state EU, which as a bloc is Iran's second-biggest customer for crude after China, agreed to an immediate ban on all new contracts to import, purchase or transport Iranian crude oil and petroleum products. However, EU countries with existing contracts to buy oil and petroleum products can honor them up to July 1. EU officials said they also agreed to freeze the assets of Iran's central bank and ban trade in gold and other precious metals with the bank and state bodies. Iran has powerful defenders against the Western action in the form of Russia and China, which argue that the new sanctions are unnecessary, and can also probably count on China and other Asian countries to go on buying much of its oil, despite US and European efforts to dissuade them. In Tehran, Mohammad Kossari, deputy head of parliament's foreign affairs and national security committee, said closure of Hormuz remained an option if exports were disrupted. “If any disruption happens regarding the sale of Iranian oil, the Strait of Hormuz will definitely be closed,” he said. The unprecedented effort to take Iran's 2.6 million barrels of oil per day off international markets has kept global prices high. Iran's rial currency plunged 10 percent to a new record low of 20,500 to the dollar, Monday, causing a surge in the cost of basic goods for Iranians.
