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Iran shrugs off European Union oil embargo

A European Union embargo on Iranian oil went into effect today, provoking anger in Tehran which says the measure will hurt talks with world powers over its sensitive nuclear activities.

world Updated: Jul 01, 2012 15:43 IST

A European Union embargo on Iranian oil went into effect on Sunday, provoking anger in Tehran which says the measure will hurt talks with world powers over its sensitive nuclear activities.

Oil Minister Rostam Qasemi sought to downplay the embargo as just the latest punishment in decades of ineffective sanctions.

Iranian leaders have insisted they will forge ahead with their atomic programme, regardless of the Western restrictions and others imposed by the UN Security Council.

Oil market observer bodies and analysts say the embargo, coupled with US financial sanctions ramped up on Thursday, are gutting Iran's vital oil exports, which account for half of government revenues.

The International Energy Agency (IEA) says Iran crude exports in May appear to have slipped to 1.5 million barrels per day (mbpd) as the market braced for the embargo, well below the 2.1-2.2 mbpd Iran insists it continues to sell abroad.

"The sanctions have had no effect on Iran and will have none," Qasemi was quoted as saying on Sunday by the ISNA news agency.

"I do not see a problem in our enemies starting the sanctions as of today (Sunday), since these sanctions have existed for many years and nothing has happened and one should not anticipate anything new," he was also quoted as saying on the website of state broadcaster IRIB.

Qasemi and other officials admitted the "illogical" embargo had reduced exports to EU nations, but they said other nations had stepped forward to buy the oil.

"While we collectively exported 18 percent of our oil to them before, it is not difficult to substitute customers for this much oil in the world," Qasemi said.