Iran Keeps Tensions High Over Oil Strait

TEHRAN - Iran kept tensions simmering Dec. 31 over its threat to close the Strait of Hormuz to oil tankers by readying war game missile tests near the entrance to the Persian Gulf.

AN IRANIAN WAR-BOAT fires a missile Dec. 30 during the 'Velayat-90' navy exercises in the Strait of Hormuz. (Ali Mohammadi / AFP via Getty Images)

Washington has warned a closure of the strait "will not be tolerated" after Iranian Vice President Reza Rahimi's threat this week that "not a drop of oil" will pass through the channel if more Western sanctions are imposed over Tehran's nuclear program.

Iran has brushed off the warning from the United States, which bases its Fifth Fleet in the Gulf, with Iranian navy chief Adm. Habibollah Sayari saying it would be "really easy" to close the strait.

A spokesman for the Iranian navy, Commodore Mahmoud Mousavi, told state television on Dec. 31 that, "in the next days, we will test-fire all kinds of surface-to-sea, sea-to-sea and surface-to-air as well as shoulder-launched missiles" in the final stages of the war games.

He did not say exactly when the launches would start, but explained they would involve tests of "medium- and long-range missiles" to evaluate their operational effectiveness.

The navy exercises started Dec. 24 and are due to end on Jan. 2.

Twenty percent of the world's oil moves through the Strait of Hormuz, at the entrance of the Gulf, making it the "most important chokepoint" globally, according to information released Dec. 30 by the U.S. Energy Information Administration.

Around 14 crude oil tankers per day pass through the narrow strait, carrying a total 17 million barrels. In all, 35 percent of all seaborne oil transited through there this year.

On Dec. 29, a U.S. aircraft carrier and an accompanying missile cruiser passed through the zone where the Iranian navy was conducting its drill. U.S. officials insisted it was a routine passage.

No confrontation occurred, though an Iranian military aircraft flew in close to record video of the aircraft carrier, which was then shown on state television.

Analysts and oil market traders have been watching developments in and around the Strait of Hormuz carefully, fearing that the intensifying war of words between arch foes Tehran and Washington could spark open confrontation.

With tensions rising, the United States said it has signed a $29.4-billion dealto supply Iran's chief rival in the Middle East, Saudi Arabia, with 84 new fighter jets.

The sale was a "strong message" to the Gulf region, Washington said.

Iran is subject to four rounds of U.N. sanctions over its nuclear program, which many Western countries allege is being used to develop atomic weapons.

Tehran denies the allegation.

The United States and its allies have also imposed unilateral sanctions on Iran's economy.

The last lot of unilateral sanctions triggered a demonstration in Tehran that led to members of the Basij militia controlled by the Revolutionary Guards ransacking the British embassy. London reacted by closing the mission and ordering Iran's embassy in Britain closed.

More sanctions are on the way.

U.S. President Barack Obama is expected to soon sign into law additional restrictions on Iran's central bank, which acts as the main conduit for Iranian oil sales.

The European Union is considering other measures that could include an EU embargo on Iranian oil imports, with foreign ministers to meet on the issue in a month's time.

Iran's oil minister, Rostam Qasemi, told the Aseman weekly that sanctions "will drive up the price of oil to at least 200 dollar" per barrel.

Iran's top nuclear negotiator, Saeed Jalili, was quoted by the Iranian media telling Islamic republic's envoys who have been gathered in Tehran that "we will give a resounding and many-pronged response to any threat against the Islamic Republic of Iran."

But he and other officials also left the door open to resuming long-stalled talks on Iran's nuclear program.

Addressing world powers involved in the talks, Jalili said: "We officially told them to come back to the negotiation based on cooperation."

Iran's ambassador to Germany, Alireza Sheikh-Attar, told the Mehr news agency on Dec. 31 that "we will soon send a letter, after which (new) talks will be scheduled."

Foreign Minister Ali Akbar Salehi was also quoted by a website of the state broadcaster as telling a visiting Chinese foreign ministry official that "Iran is prepared for the continuation of nuclear negotiations" on the basis of a Russian proposal.

Iran to Test-Fire Missiles in Hormuz War Games

TEHRAN - Iran, which has been carrying out war games in the Strait of Hormuz over the past week, is to test fire shorter- and longer-range missiles in the key oil waterway on Dec. 31, the navy said.

"Shorter- and longer-range, ground-to-sea, surface-to-surface and surface-to-air missiles will be tested on Saturday," the ISNA news agency quoted navy spokesman Commodore Mahmoud Mousavi on Dec. 30.

The move is likely to stoke tensions between Tehran and Washington, already running high over a warning by Iran this week that "not a drop of oil" would pass through the strait if Western governments followed through with planned additional sanctions over its nuclear program.

The U.S. State Department said Dec. 29 that Iran's threat to close the waterway, through which more than a third of the world's tanker-borne oil passes, exhibited "irrational behavior" and "will not be tolerated."

The naval maneuvers launched by Iran in the strait on Dec. 24 have so far included mine-laying and the use of aerial drones, according to Iranian media.

Analysts and oil market traders have been watching developments in and around the Strait of Hormuz carefully, fearing that the intensifying war of words between arch foes Tehran and Washington could spark open confrontation.

Finland: Missile Ship Free to Depart Port

HELSINKI - Finland has removed a cargo of 69 Patriot missiles found aboard a merchant ship that docked in the country and allowed the vessel to leave, transport safety officials said Dec. 26.

Thor Liberty was detained Dec. 15 in Kotka, southeast Finland, and was later found to be carrying 150 tons of explosive material, as well as the surface-to-air Patriot missiles and missile propellant charges.

"A Trafi check on 26.12.2011 has revealed that the improperly loaded explosive material has been offloaded from the vessel, with the exception of two properly loaded containers, and the detention order has been lifted," the Finnish Transport Safety Authority Trafi said in a statement.

However Trafi noted that the ship was still unable to continue on its journey because Finnish customs had placed the Ukrainian captain and first mate under a travel ban pending an investigation into the missiles.

Trafi added that customs had also impounded the explosives still on board the ship in two containers.

The missiles, discovered Dec. 21 aboard the British-registered ship, were bound for the Chinese port city of Shanghai, according to Finnish police. Finnish customs are investigating the case as one of illegal export of defense material.

A German defense ministry spokesman said the Patriot missiles, produced by Raytheon, came from the German military and were destined for South Korea.

He said it was a "legal sale on the basis of an accord between two states at the government level." He said the transaction had received an official export authorization and was reported to customs authorities.

However Finland said Dec. 23 it had not received the paperwork required from Germany.

U.S. Has Found 5,000 Missiles in Libya

WASHINGTON - U.S. experts sent to Libya to recover weapons left over by the regime of fallen leader Moammar Gadhafi have found about 5,000 surface-to-air missiles, the State Department said Dec. 23.

The exact number is difficult to say, said spokesman Mark Toner, as there is no actual inventory and a number were destroyed in NATO air strikes this year.

"We support the Libyan government as it works on this ... to disarm, demobilize, and reintegrate the militias. It's clearly a high priority for them," Toner said.

The State Department was still trying to evaluate how many missiles existed in the North African nation, which can pose a danger to civilian aircraft, Toner said.

But he refused to confirm rumors that the United States was seeking to buy back some of the weapons which might have been looted from open stockpiles in the chaos of the unrest which toppled Gadhafi earlier this year.

"I just would say that as we deal with the challenge of destroying (such missiles) MANPADS, we are looking at a variety of methods," he added.

China Rejects Link to Patriot Missiles in Finland

BEIJING - Beijing on Dec. 23 denied that a ship docked in Finland with more than 69 surface-to-air Patriot missiles on board had anything to do with China.

Finnish authorities are investigating after the missiles, produced by U.S. firm Raytheon, were discovered on a British-registered ship bound for the Chinese port city of Shanghai.

Finnish customs are investigating the case as one of illegal export of defense material. Two Ukrainians - the ship's captain and the first mate - have been detained.

"I don't see the ship transporting the missiles having anything to do with China," Chinese foreign ministry spokesman Liu Weimin told a regular briefing.

"I don't know why there is always someone who likes to link certain kinds of things with China and I have noticed the relevant report and I hope to clear up this event."

Germany's defense ministry has said the missiles came from its military and were destined for South Korea. A spokesman said the shipment was a "legal sale on the basis of an accord between two states at the government level".

He said the transaction had received an official export authorization and was reported to customs authorities.

Turkey, France Row May Jeopardize Missile Sale

PARIS - Turkey's suspension of military cooperation with France may make it harder to sell the Franco-Italian Aster 30 air defense missile to the Turkish authorities, a defense executive said Dec. 23.

Ankara froze bilateral defense cooperation and recalled its ambassador to France in retaliation to a new French law making it illegal to deny that genocides took place, including the deaths of Armenians in 1915.

"It doesn't make things easier, that's for sure," the executive said. "That makes relations tense with France."

Eurosam, a joint venture between French electronics company Thales and European missile maker MBDA, is prime contractor for the Sol-Air Moyenne Portée/Terrestre (SAMP/T) ground-based air defense system.

The SAMP/T system is competing in Turkey's tender for a long-range air and missile defense system. It is ranged against the Patriot missile from Lockheed Martin and Raytheon, the S300 from Russia's Rosoboronexport, and the HQ-9 from China Precision Machinery Import-Export Corp. (CPMIEC).

MBDA's team in Turkey is led by its Italian side, as there are strong industrial ties between Italy and Turkey, including cooperation between AgustaWestland and Turkish Aerospace Industries on the T-129 light attack helicopter.

"The SAMP/T offer in Turkey is officially made by Eurosam … but MBDA's Italian arm has effectively been the front office for the offer for a while now due to the ongoing friction between Turkey and France due in part to the genocide issue," said an Italian industrial source.

The SAMP/T is based on the MBDA Aster 30 missile and Thales Arabel multifunction radar. France and Italy were launch customers of the SAMP/T.

Between 2006 and 2010, France delivered a total 203.6 million euros of arms to Turkey, the latest annual report to parliament on French foreign military sales showed.

That made an annual average 40 million euros, or around 1 pct of average annual sales of 4 billion-5 billion euros.

As part of Ankara's response to the new law, French military aircraft cannot overfly or land on Turkish territory, French warships may not dock at its ports, and joint military exercises are canceled.

"From now on, we are revising our relations with France," Turkish Prime Minister Recep Tayyip Erdogan said, AFP reported.

French lawmakers adopted the new law Dec. 22.

Taiwan Receives Two U.S. Early Warning Aircraft

TAIPEI - Taiwan received two upgraded early warning aircraft from the United States on Dec. 18, the island's air force said, as part of an arms deal that upset China-U.S. relations.

The arrival of the E-2K aircraft in southern Kaohsiung city brings to four the number of such planes in Taiwan's air force, it said, after they were sent to the United States last year for upgrades.

Taiwan acquired four E-2Ts in 1995 and added two E-2K, an improved version of the Grumman Hawkeye series, in 2006.

A pair of E-2Ts were transported to the United States for upgrading last month, as part of a $6.5 billion arms sale agreed with Taiwan in 2008, which also included advanced interceptor Patriot missiles, Apache attack helicopters and submarine-launched missiles.

Analysts say the E-2K - an all-weather early warning and control system platform with an upgraded radar, software, avionics and propellers - will further reduce warning time if China launched an air attack on the island.

Ties between Taipei and Beijing have improved markedly since Ma Ying-jeou of the China-friendly Kuomintang party came to power in 2008 promising to boost trade links and allow more Chinese tourists to visit the island.

But Beijing still sees Taiwan as part of its territory awaiting reunification, by force if necessary, even though the island has governed itself since 1949 at the end of a civil war.

China has repeatedly threatened to invade Taiwan should the island declare formal independence, prompting Taipei to seek more advanced weapons, largely from the United States.

Pentagon Chief Sees Close Partnership with Libya

TRIPOLI - U.S. Defense Secretary Leon Panetta said that Tripoli could become an important security partner of Washington as he visited Libya on Dec. 17 for talks with new regime officials.

"We are and will be your friend and partner," Panetta said at a news conference with Libyan Prime Minister Abdel Rahim al-Kib.

"This new and free Libya can become an important security partner of the United States," he said, adding that Washington was looking forward to building a close partnership.

"We stand ready to offer whatever assistance in the spirit of friendship and a spirit of mutual respect."

But Panetta, who also met Defense Minister Osama Jouili, stressed that his talks in Tripoli did not involve military equipment.

"At this stage there was certainly no discussions involving arms or military equipment," he said when asked about the type of security cooperation he envisioned.

Earlier he had told the travelling press, including an AFP correspondent, that his brief visit to Tripoli was to confer with the country's new rulers on the security needs of their government.

"The purpose of my trip to Libya is to have an opportunity to look at that situation up close but to also pay tribute to the Libyan people to what they did in bringing (former leader Moammar) Gadhafi down and trying to establish a government for the future," Panetta said.

He acknowledged that Libya's rulers would face huge challenges but said he was confident they would "succeed in putting a democracy together in Libya."

"I'm confident that they're taking the right steps to reach out to all these groups and bring them together so that they will be part of one Libya and that they will be part of one defense system," he said.

Panetta said he expected the Libyans "to determine the future of Libya" and "determine what assistance they require from the United States and the international community."

Libya's rulers are facing a big challenge as they try to disarm militiamen who fought to topple Gadhafi and secure thousands of surface-to-air missiles stockpiled under the former regime.

Pressure to disarm the former rebels has mounted after local media reported several skirmishes between militia factions in Tripoli, with some resulting in casualties.

There are concerns that the Man-Portable Air Defense Systems, or MANPADS, could be used by militant groups against commercial airliners and helicopters.

For his part Libya's interim premier said the United States was willing to help Libya "without any interference."

Kib also acknowledged that his government had a difficult task ahead.

"We know how serious the issue is," he said, adding: "I'm very optimistic."

"The Libyan people are known to be peaceful and I'm sure that they will be back to that mentality," he said in English.

Panetta's visit came a day after the United Nations and the United States lifted sanctions on Libya's central bank in a bid to ease a cash crunch in the post-Gadhafi era, diplomats said.

The U.N. Security Council ended a freeze on the assets of the Central Bank of Libya and the Libyan Foreign Bank, which was ordered in February as part of sanctions against Gadhafi.

The U.S. government said it would be freeing more than $30 billion (23billion euros) of assets belonging to the central bank and LFB in a bid to help the new Libyan government.

The Tripoli authorities have stepped up calls in recent weeks to release the estimated $150 billion frozen abroad to help pay salaries and keep services running.

On top of the $30 billion held in the United States, British Foreign Secretary William Hague said his government would immediately act to free about 6.5 billion pounds ($10 billion) held in Britain.

The easing of the sanctions "marks another significant moment in Libya's transition," Hague said in a statement.

"It means that Libya's government will now have full access to the significant funds needed to help rebuild the country, to underpin stability and to ensure that Libyans can make the transactions that are essential to everyday life."

Panetta was also to lay a wreath at the graves of 13 U.S. sailors killed in 1804 when their ship exploded during the very first foreign intervention by military forces of the recently independent United States against pirates based in North Africa.

He travelled to Libya from Turkey, where he held wide-ranging talks. On Dec. 15, he was in Iraq to take part in a ceremony marking the end of the U.S. mission there.

5,000 Surface-to-Air Missiles Secured in Libya

SIDI BIN NUR, Libya - A top U.S. official said Dec. 11 that a team of U.S. and Libyan bomb-disposal specialists has secured about 5,000 surface-to-air missiles stockpiled during the regime of Moammar Gadhafi.

"We have identified, disbanded and secured more than 5,000 MANPADS (Man-Portable Air Defense Systems), while thousands more have been destroyed during NATO bombing," Andrew Shapiro, assistant secretary of state for political and military affairs told a group of reporters.

Dozens of these missiles were detonated in the sea, off the coast of Sidi Bin Nur village, east of Tripoli, as Shapiro, one a one-day visit to Libya, witnessed the event from the shore.

A joint U.S. and Libyan team of bomb-disposal experts has been working for several months now to find these missing missiles which are seen as potential threat to civil aviation. Gadhafi had a stockpile of 20,000 shoulder-fired missiles before the revolt against him broke out in February.

"We are working side by side with the TNC to reduce the threat of these loose weapons," Shapiro said after talks in Tripoli with officials from the ruling National Transitional Council, the interior and defense ministries.

There is a "serious concern about the threat posed by MANPADS ... about the potential threat MANPADS can pose to civil aviation. However our efforts witht he NTC to reduce these threats are already paying off."

Shapiro said contractors on the ground were still in the process of assessing how many missiles are still missing. Libya, under Gadhafi, was reportedly the country with the biggest stock of MANPADS outside of nations that produce these weapons.

The missiles, mainlySAM-7, were acquired in the 1970s and 1980s.

Shapiro said the United States has already spent $6 million in its efforts to secure these weapons.

Pakistan upgrades air defence system near Afghan border

Pakistan has upgraded its air defence system on the Afghan border to make it capable of shooting down aircraft, after Nato strikes killed 24 Pakistani soldiers, a security official told AFP on Friday.

“Now we have a fully equipped air defence system on the Afghan border. It has the capability to trace and detect any aircraft,” the official in the northwestern city of Peshawar told AFP by telephone.
The official, who spoke on condition of anonymity because he was not authorised to speak to the media, said the step had been taken to avert air incursions from Afghanistan and to respond to any future air strikes.
“The system has also been upgraded to immediately respond after detecting any aircraft or helicopter and to shoot it down,” he added.
Pakistan shut its border to Nato supply convoys on November 26, the same day as the deadliest single cross-border attack of the 10-year war in Afghanistan.
The government also ordered the United States to leave the Shamsi air base in the southwest, widely reported as a hub in the covert CIA drone war against the Taliban and al Qaeda in Pakistan’s border area with Afghanistan.

US plays down new Pak air-defence system

WASHINGTON: US Department of Defence has said that the new air-defene system installed by Pakistan was of no consequence for America as it posed no danger to their forces deployed in Afghanistan, Geo News reported. A briefing by Pentagon also stressed that to avoid another Mohmand attack better coordination was the way to go not an air-defence system, adding such tactical decisions were Pakistan’s internal affairs. The briefing added that warmer Pakistan-US ties were in the broader interest of both strategic partners in war on terror. Pentagon officials also adamantly maintained that Nato’s attack in Mohmand was involuntary.

Pakistan Warns of 'Detrimental Response' to Attacks

ISLAMABAD - Pakistan's Prime Minister Yousuf Raza Gilani warned Dec. 9 the U.S. and its NATO allies that any future cross-border attack would meet with a "detrimental response".

U.S.-Pakistani relations plunged to a new low last month after a cross-border NATO air strike which killed 24 Pakistani soldiers.

Gilani made the comments while meeting army chief of staff Gen. Ashfaq Kayani, the prime minister's secretariat said in a statement.

"The democratic government would not allow similar attack on the country's sovereignty and any attempt in future will definitely meet the detrimental response," the statement quoted Gilani as saying.

Pakistani security officials earlier said they had upgraded the air defense system on the Afghan border to make it capable of shooting down aircraft.

Kayani informed the prime minister of the steps taken on the western boarders to revamp defense capabilities aimed at effectively countering any future incursion into Pakistani territory.

"The government and the people of Pakistan were ready to provide the armed forces all the necessary resources to bolster its defense and professional capabilities," Gilani said.

Pakistan shut its border to NATO supply convoys on Nov. 26, hours after the deadliest single cross-border attack of the 10-year war in Afghanistan.

The government also ordered the United States to leave the Shamsi air base in the southwest, widely reported to be a hub in the covert CIA drone war against the Taliban and al-Qaida in Pakistan's border area with Afghanistan.

The Nov. 26 attack brought the fragile Pakistani-U.S. alliance to a fresh low, already reeling from a covert American raid that killed al-Qaida leader Osama bin Laden near the Pakistani capital on May 2.

Russia Delivers Missiles to Syria: Report

MOSCOW - Russia has delivered supersonic cruise missiles to Syria despite the violence shaking the Arab country and Israel's furious condemnation of the deal, a news report said on Dec. 1.

"The Yakhont supersonic anti-ship cruise missiles have been delivered to Syria," a military source told the Interfax news agency without disclosing when the shipment was made.

Russia signed a contract reportedly worth at least $300 million (222 million euros) in 2007 to supply its traditional Arab world ally with a large shipment of the cruise missiles.

Reports said Russia intended to deliver 72 of the missiles to Syria in all.

The deal immediately angered Israel, which fears the weapons may fall into the hands of Hezbollah militants in neighboring Lebanon.

Russia has since also come under growing pressure from Washington, which wants all military sales to President Bashar al-Assad's regime halted because of his deadly crackdown on Syrian street protests.

But Moscow has defended Assad against global pressure and this week argued that its arms sales were permitted under international law and would continue.

Another Russian official told Interfax that the missiles, which operate as part of the Bastion mobile coastal defense system, "will be able to protect Syria's entire coast against a possible attack from the sea."

Each Bastion system is equipped with 36 cruise missiles as well as truck-mounted radar and other equipment.

It was not immediately clear how many of the missiles Russia has delivered to Syria so far.

Germany Lends Air-Defense Radar to Israel

TEL AVIV - Germany recently delivered a Patriot air defense radar to Israel as a cost-free loaner pending conclusion of a three- to four-year refurbishment in the United States of Israel's own AN/MPQ-53 radars for its PAC-2 force.

German, U.S. and Israeli sources confirmed the trilateral cooperation, aimed at filling potential gaps in Israeli air defense coverage while Israel Air Force radars are being serviced at Fort Sill, Okla.

The loaner radar provided by the German Bundeswehr arrived here in mid-October, shortly before the first of three Israeli Patriot radar sets was shipped to the United States for servicing. The German delivery marks an expansion of strategic cooperation with Israel, which received two full-up Patriot PAC-2 batteries from Luftwaffe stocks in 2003 in the run-up to the U.S.-led coalition war in Iraq.

Sources said it will take about a year to replace aging components of each radar, extend service life, and improve its ability to interoperate with U.S. European Command's Patriot batteries that participate in biannual U.S.-Israel exercises and could be rushed here for emergency deployment during wartime.

The refurbishment program is estimated at $15 million and will be funded through annual U.S. Foreign Military Financing (FMF) assistance to Israel. Israeli and German officials confirmed that the German loaner radar would remain here until the upgrade program is complete and all Israeli radars are redeployed and integrated with other elements of the Air Force's Air Defense Force.

"Germany has contributed to the air defense system of Israel since 2003 with the loan of two Patriot systems. Additional components are temporarily on loan to maintain the operational capability of the systems," said Lt. Col. Holger Neumann, a German MoD spokesman.

An Israel Air Force officer emphasized that the recently launched Patriot radar upgrade is more logistical in nature and is not aimed at converting Israel's PAC-2 air defense force to the PAC-3 ballistic missile intercepting configuration.

Israel has no plans to procure PAC-3 missile interceptors from Lockheed Martin, he said. Instead, the Air Defense Force is looking to deploy the David's Sling air and missile defense system now in development by Rafael and Raytheon.

Nevertheless, the Air Force officer said Israel "is looking very closely" at a so-called Config-3 program that would render its existing PAC-2 force more capable of operating with PAC-3 intercepting batteries.

No decision has been made on the estimated $60 million Config-3 program with Raytheon, producers of the Patriot radar, engagement control stations, launching units, and improved PAC-2 interceptor missiles.

Qatar Discusses MEADS Partnership with Germany, Italy

Qatar is in talks to become a risk partner on the Medium Extended Air Defense System (MEADS) missile defense program with Germany and Italy, a source knowledgeable of the talks has told Defense News.

Qatar is in talks to become a partner on the MEADS missile defense program with Germany and Italy. (Lockheed Martin)

The gulf state started talks with Italy and Germany after the U.S. announced in February that it would leave the program at the conclusion of the development phase, without procuring the system.

Qatar is interested in the program as it looks to security requirements ahead of 2022 when it is hosting the soccer World Cup, the source said. The growing perception of a missile threat from Iran has also persuaded the gulf state to consider joining MEADS.
It is not clear how Qatar's entry into the program would save it, since 58 percent of the program has been funded by the U.S., with Germany and Italy funding 25 percent and 17 percent respectively. After the U.S. pulls out, Germany said it would not proceed with procurement.
The U.S. has spent $1.5 billion thus far on the $4.2 billion program. Pentagon officials plan to spend another $800 million to complete the design and development phase in 2014.
Lockheed Martin, which is developing the missile defense system, announced it completed its first successful flight test Nov. 17 at White Sands Missile Range, N.M. The test proved the PAC-3 Missile Segment Enhancement could destroy a simulated target attacking from behind.
"Today's successful flight test is an important validation for the continuing MEADS development," said MEADS International President Dave Berganini in a statement.
"MEADS' advanced capabilities detect, track and intercept tomorrow's threats from farther away and without blind spots. The MEADS digital design ensures high reliability and significantly reduced operational and support costs."
The test comes as the U.S. Congress continues to rip the program and question why a nation struggling to shrink its defense budget would spend nearly another $1 billion on a missile defense system the Army has said it doesn't want. Congress left appropriations out of the defense authorization bill to pay the rest of the contract.
"The committee concluded that the course proposed by the Department is untenable and that the Department should explore all options with our allies before continuing to fund a program which we no longer need," Sen. Carl Levin, D-Mich., chairman of the Senate Armed Services Committee, wrote in a statement.
President Barack Obama disagreed with the decision to cancel the program, saying he recommended the Pentagon complete the contract. He said it made sense to complete the design and development phase rather than cancel the program and potentially pay more in cancellation fees. Canceling now would also let down our international partners.
"This lack of authorization could also call into question DoD's ability to honor its financial commitments in other binding cooperative MOUs and have adverse consequences for other international cooperative programs," the statement from the Office of Management and Budget reads.