Japan helps US sanctions with cut to Iran oil imports

Iran's “nuclear development problem can't be ignored by the world, so from that perspective we understand the U.S. actions,” Japan Finance Minister Jun Azumi told reporters after meeting with U.S. Treasury Secretary Timothy Geithner, who was visiting Tokyo after two days in Beijing.

Japan imports about 10 percent of its oil from Iran, Azumi said.

“We plan to start reducing this 10-percent share as soon as possible in a planned manner,” he said.

Japan's quick agreement contrasts with China's public silence on the matter during Geithner's visit there. A diplomat who briefed reporters about an upcoming Middle East trip by Premier Wen Jiabao repeated earlier government statements rejecting sanctions as a way to resolve the dispute with Iran.

Geithner's trip to Asia's two largest economies is part of a global lobbying effort to win support for the sanctions aimed at halting what Western governments say is Iran's effort to develop nuclear weapons.

Iran has threatened to respond to sanctions by shutting the Strait of Hormuz, a transit route for a fifth of the world's oil.

China has criticized U.S. sanctions on Iran, approved by U.S. President Barack Obama on New Year's Eve, as improper and ineffective. Beijing supported U.N. sanctions on Iran's nuclear program but says action should be multilateral.

Azumi said working out a plan for non-oil imports would take more time. Japan also imports natural gas from Iran.

During their one-hour meeting, the Azumi and Geithner also discussed the eurozone debt crisis and Japan's reconstruction from the tsunami disaster in March.

“The leaders of Europe appear to be making some progress in containing their crisis,” Geithner said, adding that the U.S. was “fully prepared to support a more substantial role” by the International Monetary Fund (IMF) in supporting the European response.

The two leaders also took a swipe at China's currency policies, with Azumi saying he wanted to see Beijing adopt a more “flexible” exchange rate policy.

In a veiled reference to China, Geithner said the U.S. wants to see a stronger commitment by emerging economies in the Group of 20 (G-20) to flexible exchange rates. The U.S. contends Beijing keeps its yuan undervalued, giving its exporters an unfair price advantage.

“We want to see those emerging market currencies that are undervalued continue to appreciate against the major currencies, against the dollar, the yen and the euro,” Geithner said.

Reactions from Other Countries

India has given no instructions to refiners to reduce crude oil imports from Iran, despite an intensifying U.S. campaign to smother Tehran's vital oil exports until it gives up on its nuclear program.

“We haven't told refiners to cut supplies,” Sudhir Bhargava, additional secretary at the Indian oil ministry, told Dow Jones Newswires on Thursday.

Turkey, which imports oil and gas from Iran, says it is only bound by U.N. sanctions against its eastern neighbor.

Foreign Ministry spokesman Selcuk Unal said Thursday that Turkey would evaluate the sanctions against Iran approved by the Obama administration but “does not feel it is bound by any other sanctions.”

Meanwhile, a U.S. Treasury official said he discussed the sanctions with Philippine and Thai officials. U.S. Deputy Treasury Secretary Neal Wolin, who was visiting Manila, said he has not asked for commitments and none were made.

Wolin told reporters Thursday that officials he met in the Philippines, and Thailand before that, “have listened” and there appears to be “a broad desire to be helpful here and cooperative.”

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