Iran's oil

Iran on Monday said it had tested two long-range missiles near the Strait of Hormuz, amid growing tensions with the West over the country's nuclear program.

The latest military maneuvers came after reports over the weekend that Iranian scientists had developed their first nuclear fuel rod despite United Nations sanctions and measures by the US to stop the country's atomic work. On Saturday, US President Barack Obama signed new sanctions against Iran into law, targeting the country's central bank, oil exports and financial sector.

In response, Iran has warned it could shut the strategic Strait of Hormuz, a narrow Gulf shipping lane through which 40 percent of the world's oil passes.

The US and its European allies accuse Iran of using its nuclear program as a cover to develop atomic weapons. Iran denies the charge, saying the program is for peaceful purposes and is geared towards generating electricity.

DW-TV talked to Hennig Riecke, international security analyst at the Berlin-based German Council on Foreign Relations, about the latest developments.

Deutsche Welle: Let's talk about the military might of Iran. Does it have the capability of blocking the Strait of Hormuz?

Henning Riecke: Iran has demonstrated military presence and capabilities and could of course block or hamper free passage through the Strait of Hormuz. But it's not important to close the Strait like a door to make it difficult and expensive for ships to cross. To endanger shipping traffic, it would be enough to hamper trade and make oil prices soar - and that's what Iran is aiming for.

Do you think Iran would actually go through with this and risk hurting its own economy?

I don't really believe that because Iran relies on imports for refined gasoline. This is an important good domestically, when it comes to the Iranian people that are happy with the government. I don't think they will do that. They are trying to show America that it is vulnerable as well.

Why are we seeing this sudden escalation?

The Iranians are currently facing sanctions that are much more severe than in the past. They target Iran's financial sector and the expansion of its oil industry which is why they are especially worried. I believe that the latest maneuvers by Iran are aimed at driving up the oil price and exposing the vulnerability of the Americans and Europeans negotiating the latest round of sanctions.

The oil prices haven't reacted as strongly as was expected but they remain volatile. And it's exactly these price fluctuations that Iran is trying to achieve as a response to the sanctions and maybe even for a situation where it at some point faces military strikes over its nuclear program.

There are two sides to this as well. Iran has also agreed to continue with six-nation talks.

I think the Iranians are trying to show the trumps they have available so that they can fight back in one way or the other when sanctions are on the table again. They want to disrupt the unity of American and European negotiators when it comes to new sanctions against the oil industry in Iran.

Recent reports said Iranian scientists had produced the country's first nuclear fuel rod. How far advanced is Iran's nuclear program?

Work on the Iranian nuclear program is continuing at a good pace, particularly when it comes to uranium enrichment. The uranium reserves that Iran has are being enriched to a degree of radioactivity that's suitable for fuel rods, for nuclear power stations or even nuclear bombs. That is definitely continuing and it's sparked huge concerns in the US. That is the most important point in negotiations with Iran.

A report by the International Atomic Energy Agency (IAEA) last autumn clearly showed that Iran is working on technologies to build nuclear bombs. It's not clear how long that will continue. The important question is - does Iran really want to build a nuclear bomb or does it simply want to have the capability to build a bomb relatively quickly? I believe that the latter is true and that alone is a politically explosive issue.

Interview: Dirk Jacobs / sp
Editor: Rob Mudge