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European analysts: effect of European oil ban on Iran depends on major

Asian countries By Nawab Khan BRUSSELS, Jan 24 (KUNA) -- The EU oil sanctions on Iran could only be effective if other major Iranian oil importers like China and India could be persuaded to join the ban, according to European analysts.
"The EU embargo to be effective depends if countries like India and China could be bought on board," Shada Islam, Head of Policy at the Brussels-based think-tank Friends of Europe told the Kuwait news agency (KUNA).
"The EU is a large importer of Iranian oil but it is not the largest by any means. So in the next few weeks we are going to see some very active European diplomacy to bring countries like China and India and other Asian countries on board," she said.
Dr. Rym Ayadi, senior research fellow at the Centre for European Policy Studies in Brussels shares the view.
"The EU ban will not have much effect unless counties like China and India will also impose a ban on Iran.
China and India and some other countries have the capacity to make up for the difference easily," Ayadi told KUNA.
According to Janis Emmemanouilidis, Senior Policy Analyst at the European Policy Centre in Brussels, the EU oil embargo could have a negative effect on the oil market.
"Obviously when you have an embargo which leads to a deterioation in relations between oil buyers and oil producers, in this case Iran, there will be a negative effect on the oil market and we have seen that already in the sense that there are oil price increases," he told KUNA.
On the other hand, he said, if you look into the EU resolution on Iran there is a timeframe provided for EU member states to prepare for the embargo starting in July.
"So that is a way to cushion the effect on some of the EU member states which are more affected than others," said Janis.
He noted that the oil price is being dictated by many things. "So it is difficult to give an overall judgement of how the oil prices will develop because there is a major economic problem not only in Europe but in the world and deterioration of the global economic situation could have a negative effect on the price in the sense that it could reduce the prices," he opined. Shada Islam thinks that in the near future there will be an increase in the oil prices but the Europeans are banking on getting access to more oil from Libya to compensate for the ban on Iran.
Commenting on relations between Iran and the EU, Islam said "for the moment relations are going from bad to worse but we are living in a multilateral and multipolar world live and given the importance of Iran as an oil supplier and as a country I dont think the EU and Iran can afford to be at loggerheads for all time." "It is a big diplomatic failure to find a negotiated settlement which would have been the ideal way to resolve the nuclear issue," she said, but added that once the tremperature cools down they should go back to negotiaons and diplomacy.
Islam noted that Iran is a big oil supplier to southern European countries like Greece, Spain and Italy which are suffering most from the euro crisis.
Ayadi said the EU ban is is a costly decision for the EU and from an economic point of view they need to find alternatives for oil supply for Europe.
"Perhaps they have an agreement with Gulf countries to increase the oil production," she said.
Ayadi is of the views that if oil demand does not increase there will not be an increase on oil prices.
On EU-Iran ties, Ayadi said the position of Europe has been very clear on the nuclear programme of Iran.
"If Iran will step back I do not know they keep doing what they want to do. There will always be a room for dialogue and discussions but this depends on to what extent the parties are willing to give concessions," she told KUNA. (end) nk.mt KUNA 242039 Jan 12NNNN