Boeing Co. and Exxon Mobil Corp. are lobbying to fend off tightened sanctions against Iran that business groups say may cost $25 billion in U.S. exports.

Legislation before Congress would expand a 1996 law penalizing foreign companies that invest in that country’s oil industry. U.S. firms, already barred from investing there, say their sales worldwide could be hurt by provisions that ban doing business with companies in Europe, Russia or China that trade with Iran.
“We are up on Capitol Hill talking about the collateral damage,” William Reinsch, president of the National Foreign Trade Council, a Washington-based group that represents Exxon and Boeing, said in an interview. “There is legitimate, non-Iran business that will be cut off.”
The sanctions measure follows President Barack Obama’s difficulty in getting other countries to agree to expanded financial penalties on Iran. Lawmakers are trying to work out differences this month between Senate and House versions of the bill.
Cargill Inc., ConocoPhillips, Hannover Re, Bechtel Corp., Halliburton Co. and Siemens AG are among more than 20 companies that have lobbied on the proposed sanctions, according to congressional disclosure forms.
The 1996 U.S. law already provides for sanctions against foreign firms that invest to help Iran drill for oil, such as a cut-off from government contracts, denial of loans from U.S. banks or restrictions on imports. No president has imposed those sanctions.
For U.S. companies, “virtually any transaction with foreign entities doing business related to the Iranian petroleum sector could be prohibited,” the National Association of Manufacturers said in a study that estimated the potential loss of $25 billion in exports.
Expanded Iran sanctions may mean another loss for the Chamber, the largest U.S. business lobby, and the manufacturers association, with members such as Caterpillar Inc. and Pfizer Inc.
The Chamber’s top lobbyist, Bruce Josten, wrote Senate Banking Committee Chairman Christopher Dodd, a Connecticut Democrat, on May 6 urging them to scale back the new rules, which he said would hurt U.S. oil companies, manufacturers and insurers by cutting them off from “critical partners around the world.”
Chicago-based Boeing, the world’s second-largest commercial plane maker after Airbus SAS, wants to strip out a provision banning U.S. companies from being aided by foreign export-credit agencies that also guarantee exports to Iran, spokesman Timothy Neale said.
Exxon, the biggest U.S. oil company, wants to eliminate a prohibition on joint ventures with companies that separately have oil projects in Iran, said Alan Jeffers, a spokesman for the Irving, Texas-based company. Lloyd’s of London and other insurers based abroad want an exemption for “cooperating countries” working with the U.S. to curb sales to Iran, Charles Landgraf, the insurance market’s Washington lobbyist, said in an interview.
A report by the Government Accountability Office in March found 41 businesses, including PetroChina Co., Petroleo Brasileiro SA, Total SA, Gazprom OAO and Indian Oil Corp., investing in Iran’s oil development.
(Source: Bloomberg)
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