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Iran says oil would go over $250 if exports banned

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Iran says oil would go over $250 if exports banned Three_cols







Iranian Foreign Ministry Spokesman Ramin Mehmanparast
speaks with a Reuters correspondent during an interview in Tehran June
29, 2011. REUTERS/Caren Firouz


















By Ramin Mostafavi and Robin Pomeroy, Reuters



TEHRAN (Reuters) - Iran warned the West on Sunday any move to
block its oil exports would more than double crude prices with
devastating consequences on a fragile global economy.

"As soon as
such an issue is raised seriously the oil price would soar to above
$250 a barrel," Foreign Ministry spokesman Ramin Mehmanparast said in a
newspaper interview.

The comments come as Iran strives to contain
international reaction to the storming of the British embassy last
week, a move which drew immediate condemnation from around the world and
may galvanize support for tougher action against Tehran.

Washington
and EU countries were already discussing measures to restrict oil
exports after the United Nations nuclear watchdog issued a report in
November with what it said was evidence that Tehran had worked on
designing an atom bomb.

Iran says its nuclear program is entirely peaceful.

The U.S. Senate voted on Thursday to penalize foreign financial institutions that do business with Iran's central bank

--
which takes payment for the 2.6 million barrels Iran exports a day. The
European Union is considering a ban -- already in place in the United
States -- on Iranian oil imports.

So far neither Washington nor
Brussels has finalized its move against the oil trade or the central
bank amid fears of the possible impact on the global economy of
restricting oil flows from the world's fifth biggest exporter.

But
the British embassy attack dragged relations with Europe to a long-time
low and Iran is now facing rising rhetoric about a direct hit on its
main source of foreign earnings.

Until recently, Iran had
dismissed as ineffective mounting sanctions aimed at forcing it to halt
its nuclear activities. Mehmanparast's comments show a more defensive
stance.

"No one welcomes the sanctions, we know that sanctions
create obstacles, but we want to say we will overcome these obstacles,"
Mehmanparast told Sharq daily.

"Imposing sanctions on oil and gas
is among the sanctions that, if one wants to do that, the consequences
should be fully considered before taking any action," Mehmanparast said.

"I do not think the situation in the world and especially in the West today is prepared enough to raise such discussions."

Britain's
embassy in Tehran was ransacked on Tuesday after London announced
unilateral sanctions on Iran's central bank. London evacuated staff,
closed the embassy and the biggest EU states withdrew their ambassadors
in protests.

Rising tensions were enough to push up crude prices
with ICE Brent January crude up 95 cents on Friday to settle at $109.94 a
barrel.

Mehmanparast warned the EU on Saturday to avoid tying itself to British interests.

(Reporting by Ramin Mostafavi; Writing by Robin Pomeroy; Editing by Maria Golovnina)

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