Turkey to be hard hit by U.S. sanctions against Iran: analysts

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The U.S. move to reinstate economic sanctions against Iran would not only harm Turkey's economy but also pose problems in Ankara's regional policy, analysts told Xinhua.

The impending sanctions are sure to deal a blow to the Turkish economy, said Aziz Konukman, a professor of economics.

President Donald Trump announced Tuesday U.S. withdrawal from the landmark nuclear deal with Iran, vowing to re-impose "the highest level of economic sanctions" against the Islamic republic.

A decrease in oil imports from Iran would adversely affect Turkish exports there, said Konukman, who teaches at Gazi University in Ankara.

Turkey will begin to genuinely feel the negative effects of the U.S. move when the sanctions go into effect, said Cahit Armagan Dilek, head of the Ankara-based 21st Century Turkey Institute.

Some of the punitive measures, like those related to Iran's acquisition of U.S. dollars, trade in gold and precious metals and automotive sector, will take effect following a 90-day wind-down period ending on Aug. 6.

Those related to the purchase of petroleum and petroleum products from Iran as well as to its energy, shipping and shipbuilding sectors are to take effect as of Nov. 4 this year.

The U.S. and the European Union have lifted economic sanctions on Iran after the deal that imposed restrictions on Tehran's nuclear program was concluded in 2015.

The U.S. reversal would make Turkey pay a higher bill for energy, as its oil imports from neighboring Iran should be expected to fall as oil prices rise, said Sinan Ulgen, a former diplomat.

"Ankara would talk with Washington about exemption from the sanctions, but it's expected that its oil imports from Tehran would decrease," said Ulgen, who chairs the Istanbul-based Center for Economics and Foreign Policy Studies.

Turkey has been making efforts to boost economic ties with its eastern neighbor since the West lifted the sanctions against Iran in early 2016.

Iran has become Turkey's biggest supplier of crude oil and the second biggest supplier of natural gas after Russia.

Turkish Foreign Minister Mevlut Cavusoglu said in December last year that Turkey wanted to import more crude oil and natural gas from Iran and was working to supply the Iranian gas to other countries via Turkey.

Turkish-U.S. ties have been strained as a Turkish banker, Hakan Atilla, was found guilty by a New York court of defrauding U.S. banks and violating U.S. sanctions against Iran before the nuclear deal was inked in 2015.

The court is expected to hand down next week its verdict on Atilla, the former deputy chief executive officer of Halkbank, a state-owned institution.

Several Turkish banks may also be sentenced by the U.S. court to pay billions of dollars in fines over similar charges, according to Turkish media reports.

As Washington backtracks on the Iran deal, the other five signatories, namely Britain, China, France, Russia and Germany, have pledged efforts to save the deal for the sake of regional stability and non-proliferation of nuclear weapons.

For his part, Iranian President Hassan Rouhani signaled his country's readiness to remain in the nuclear deal if a consensus is reached, though he raised the possibility of restarting enriching uranium after talks fail.

The U.S. says the current deal must be amended to ensure that Iran cannot develop nuclear weapons. Tehran has, however, flatly rejected any renegotiation on the deal, insisting that it has no intention of producing nuclear weapons.

The disagreement risks leading to increasing geopolitical tension in the region.

"Something will happen" unless Iran agrees to renegotiate, Trump said one day after declaring withdrawal from the deal, threatening Iran with severe consequences in case it restarts its nuclear program.

Dilek feels that the U.S., Turkey's NATO ally, may use the sanctions to blackmail Ankara into siding with it against Tehran.

Noting the sanctions will cover all of Iran's state and financial institutions, he said any country cooperating with them could also face U.S. punishment.

"In such a case, Turkey would be the country that would be most severely affected," he added.

Should Ankara agree to act in line with the U.S. sanctions, it would risk losing Iran's possible cooperation against the outlawed Kurdistan Workers' Party, which has been fighting against the Turkish state for over three decades.

Turkey's energy ties with Iran would be at risk as well, said Dilek.

Siding with Washington could also damage Ankara's ongoing cooperation with Tehran in war-torn Syria, as Ankara, Moscow and Tehran have been jointly pushing for a political settlement of the Syrian conflict since last year.

In the days ahead, the U.S. should be expected to increase pressure to have Ankara's support against Iran, remarked Ulgen.

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