By Erik Wasson – 01/04/12 09:52 AM ET
Treasury Secretary Tim Geithner will travel to China and Japan next week to hold high-level economic talks, the Treasury Department announced Wednesday.
President Obama last weekend signed harsh new U.S. sanctions into law as part of the 2012 defense authorization bill.
Iran has threatened to block shipping in the Persian Gulf in order to cause a spike in oil prices, in retaliation. China is one of the biggest customers for Iran’s oil and has shown reluctance to punish Tehran.
China’s foreign ministry on Wednesday criticized the new U.S. sanctions.
“China has always maintained that sanctions were not easing tensions, the Iranian nuclear issue has to be resolved in a fundamental way, that dialogue and negotiation is the only correct way,” spokesman Hong Lei said when asked about the U.S. law.
“China is opposed to a country putting its domestic law above international law, by placing on the other countries unilateral sanctions. Like many other countries, China and Iran maintained normal, open and transparent trade and energy exchanges, these transactions do not violate United Nations Security Council resolutions should not be affected.”
Geithner’s trip on Jan. 10 to 12 will start off with a meeting with Chinese Vice Premier Wang Qishan.
In a conciliatory gesture to China last week, Treasury once again decided not to name China a “currency manipulator,” despite acknowledging that the renminbi is undervalued.
The low value of China’s currency promotes China’s exports into the United States and hurts the ability of U.S. products to compete in China. A Senate-passed bill to slap trade sanctions on China over its currency has stalled in the House since October.
Geithner will meet with Prime Minister Yoshihiko Noda on his journey to Japan. Japan is contemplating trying to join the TransPacific Partnership trade agreement being negotiated by the Obama administration.
For such a TPP agreement to be completed, Congress would almost certainly need to renew fast-track trade negotiating authority for the president. That power would force up-or-down votes in Congress on any trade pact.
- China downplays effect of new U.S. sanctions on Iran (ctv.ca)
- China opposes ‘unilateral’ US sanctions on Iran (thehimalayantimes.com)
- Tough new sanctions on Iran could upset U.S. allies (news.nationalpost.com)
- France Calls for Stricter Sanctions on Iran (ibtimes.com)
- Geithner headed to China, Japan next week (forexlive.com)
- U.S. Sanctions Target Iran’s Central Bank (npr.org)
- Obama signs into law tough new sanctions against Iran’s central bank, financial sector (thecurrencynewshound.com)
Queensland’s recent heavy rains and floods could delay the expansion of BG Group’s $18 billion Queensland Curtis LNG plant at Gladstone because the British gas giant has been unable to shore up gas reserves as quickly as it had hoped.
Speaking to investors in London on Tuesday night, chief executive Frank Chapman said BG was still targeting a mid-2012 sanction of a third LNG production train at Gladstone.
“The name of the game at the moment is the maturation of that reserves and resources base within that period,” Mr Chapman said.
“That has suffered some impact because of the flooding and the impact that’s had on access to drilling sites, but we’re still focused on moving some of that prospective resource into a more, higher confidence level to underpin a third train.”
Despite the rains, BG was still on track for first LNG exports from Gladstone in 2014, he said.
BG was the first of three big CSG-to-LNG proponents planning exports out of Gladstone from 2014.
Mr Chapman joined the chorus of voices touting stronger LNG demand because of the Japanese earthquake and subsequent Fukushima nuclear disaster.
He said the flow-on effect was likely to be long-term. “After (the) Three Mile Island (1979 nuclear accident) in the US, we saw lead times for nuclear projects going out to something like 12 or 13 years, and associated with that will be increased costs associated with more stringent regulatory safety requirements,” he said.
“All of this, I think will result in medium to long-term higher gas demand for power, and as a consequence, extra demand for LNG, and this is going to cause a further tightening of a market situation which we already regarded as quite tight.”