A defiant Iranian government today raised the negotiating price for the release of hostages held at the U.S. Embassy here and declared an oil embargo against the United States.
Abol Hassan Bani-Sadr, appointed last week by Ayatollah Ruhallah Khomeini to run the Iranian Foreign Ministry, told a meeting of the more than 70 accredited chiefs of diplomatic missions here that Iran has three demands:
American recognition that Shah Mohammad Reza Pahlavi is a criminal and must be extradited to stand trial here.
The return to Iran of the shah's fortune, described as the assets of the Iranian people.
An end to "American meddling in Iranian domestic affairs.
Later, Iranian radio and television interrupted its nightly programs to announce an embargo on oil sales to the United States at about the same time President Carter was telling the American people that the United States would no longer buy Iranian oil.
Although the Iranian announcement seemed to follow Carter's statement, Oil Minister Ali Akbar Moinfar insisted that the ruling Revolutionary Council had already made the decision in a six-hour meeting this afternoon and evening.
Independent observers said news that Carter was considering a boycott reached Iran by radio before his decision was announced.
"The Revolutionary Council had considered stopping oil supplies to the United States when the shah was admitted" to a New York hospital for medical treatment, Moinfar said. "But they didn't want to do anything harsh to the American people, so they delayed it [the decision].
"Tonight, in fact, the Revolutionary Council made the decision to stop oil exports to the United States," he said, insisting that Iran had acted first. eThe minister said the decision would be "to the financial benefit of Iran because we have plenty of customers."
Analysts here tended to agree that Iran could benefit from higher spot market prices and noted that Japan recently had been pressing for as much as a 40 percent increase in its normal oil imports from Iran.
The Iranian announcement that it was cutting oil deliveries to the United States contained no indication of whether Iran was considering reducing production.
Asked to transmit Bani-Sadr's demands to Washington, diplomats from countries as politically different as radical Algeria and neutral Switzerland raised objections to the form and content of the Iranian government's initiative.
In Tehran itself about 1,000 unemployed men, mostly high school graduates, took over the Labor Ministry to back demands for jobs, unemployment payments and health insurance.
Shouting "down with fascism, down with reaction and down with tyranny," the unemployed were received by Labor Minister Ali Esbabodi after routing the Revolutionary Guards. Who unsuccessfully fired over their heads in an abortive efforts to disperse the demonstration.
The demonstration, organized by the Union of Iranian Communists, was one in a series called to protest widespread unemployment. Since the February revolution, 2 million to 3 million of an estimated 9 million work force have been jobless.
At the occupied U.S. Embassy meanwhile, a student leader said the 500 Moslem militants who invaded it eight days ago were armed with just 10 pistols and were surprised to meet no resistance from Marine guards, Reuter news service reported.
Observers searching for a glimmer of hope noted that the way was now open not only for an American gesture, but also for discreet diplomacy likely to meet Iran's objection to anything visibily connected with formal mediation.
[In Washington, a State Department spokesman said the hostages will be permitted to receive letters from their families.]
However, the diplomatic consensus was that there appeares little hope of any rapid resolution of the crisis.
Swiss Ambassador Erik Lang reportedly argued that Iran's charges of espionage at the U.S. Embassy did not justify taking hostages.
International practice in such cases provided for expelling diplomats, reducing an embassy's size or even breaking diplomatic relations, he said amid applause from Western ambassadors.
Bani-Sadr replied this was not a time to be absorbed in jurdicial details since the Iranian people have suffered humiliations at the hands of the United States.
Algerian Charge d'Affaires Mustafa Belhocine asked if the massage were Iran's final work and if the ruling Revolutionary Council could not soften its language.
Bani-Sadr offered no such encouragement.
Signs of tension not directly related to the U.S.-Iranian crisis were also evident from Tehran to the rebellious province of Kurdistan in the west of the country.
Britain, for example, today followed an earlier U.S. and West German lead in urging its nationals "without a need to stay" to leave Iran.
Possibly prompting the British decision were recent Iranian press reports accusing Ambassador John Graham of running a spy ring allegedly working with Israel and U.S. espionage agencies to kill leaders of Iran's revolution.
Another recent article alleged that the Anglicans' Church Mission Society hospital and other services in Isfahan were spy centers.
The church's facilities were taken over recently by Islamic militants, and the Anglican biships in Iran narrowly escaped an assassination attempt.
In Kurdistan, further fighting was reported, with Kurdish rebels said to have launched an "all-out attack" last night on the major city of Sanandaj and the regional towns of Jovanrud, Mowsud and Saqqez.
The report, from the official Pars News Agency, said fighting continued today. It quoted a progovernment Revolutionary Guard commander in Kermanshah as sayin, "A large number of people have been martyred" -- the Islamic term for killed -- "or wounded" in the fresh fighting. In Sanandaj, the news agency said, rebels had used rocket-propelled grenades against the Revolutionary Guards.
Tehran press reports said a government goodwill mission has returned from Kurdistan without having yet persuaded Kurds loyal to Sheik Ezzedine Hosseini to accept a compromise apparently approved by Abdurahman Qassemlu, the leader of the Kurdistan Democratic Party.
The Tehran authorities' apparent willingness to negotiate a separate peace with the party is a full measure of their military weakness. Only three months ago Ayatollah Khomeini ordered talks broken off and the rebellion crushed by force. But both the Army and Revolutionary Guards in Kurdistan are reported to be in a shambles.
In front of the U.S. Embassy, crowds kept up their anti-American chanting as the student captors of the hostages announced a five-day fast to back their demands.
The students said the hostages would be fed as usual.
Dozens of Islamic groups -- ranging from Tehran bus drivers to diplomats abroad -- joined the fast, which will be in effect from sunup to sundown.
Meanwhile, a 36-year-old Iranian who immolated himself last week in front of the embassy to back Khomeini's demands for the shah's return, was reported today to have died.
His last will and testament reportedly left all his worldly goods to Khomeini.
Reuter quoted a student leader at the embassy as saying of the Nov. 4 takeover: "We had expected that many of us would be killed. It was quite a surprise."
The 24-year-old leader, who gave his name only as Hassan, repeated the occupiers' insistence that no hostages will be released unitl the shah is returned for trial.
Hassan said a plot to occupy the embassy was hatched about 2 1/2 weeks ago and was planned down to the last detail.
Only 10 students were aware of the plan until the morning of the takeover. then, they gathered some 500 trusted Islamic students at four Tehran universities, and the leaders told them where they should go in the embassy and what they should do, Hassan said.
"First we made sure everyone knew how to fire a pistol or an automatic rifle, which we knew we would find inside the embassy," he said. "But really we had a maximum of 10 pistols between us."
He continued: "The whole group of around 500 assembled a block east of the embassy, ironcally near Roosevelt Avenue, at 10:30. They immediately marched west along Taleghani Avenue towards the embassy's front gates.
"The girls marched in front and we all sang and chatted. We let the girls march on past the gates, then turned and faced the embassy. A few handpicked men ran at the gates and clambered over. The gates were not padlocked and they were able to open them easily and let us all in.
"There were three or four Iranian policemen, armed with pistols, inside the gate but they were dumbfounded. Anyway, we knew policemen were under strict orders not to shoot anyone.
"But we were surprised to find no Marines. We walked forward in groups in all directions through the compound.We met no resistance. The four or five Marines who live at the back of the compound locked themselves in their quarters.
"We all went to our arranged positions, occupying the chancery, the visa section and the bugalows first. Most of the Americans calmly put their hands on their heads when they saw us," Hassan said.