The effectiveness of expanded U.S. sanctions on Iran, intended to block all potential sources of revenue, is being met with skepticism by some experts. While the stated goal is to tighten economic pressure, analysts suggest that the direct impact on Iran's revenues may be limited due to the country's existing trade relationships and the sheer breadth of previous sanctions.
Ali Vaez, deputy director at the International Crisis Group, noted that "anything that moves in Iran has already been sanctioned by multiple layers of sanctions." He emphasized that the critical factor moving forward will be enforcement: "Does the United States have what it takes to impose fines and levies on countries that continue to trade with Iran?"
This question of enforcement is crucial, especially considering past instances. Vaez pointed to the U.S. initiation of an "economic war with China, Iran's biggest trading partner," last year, from which the U.S. eventually "backed out."
Former senior advisor at the State Department, Aya Ibrahim, raised concerns about the unintended consequences of such broad sanctions. She stated that an overreliance on sanctions can "incentivise countries to find ways around that system." Furthermore, Ibrahim expressed apprehension that the sanctions might disproportionately affect Iranian civilians, potentially "deny[ing] people necessities to stay alive," rather than crippling the economy.
Global markets have shown a muted reaction to the announcement of further sanctions. Oil prices experienced a decline following the news but remain significantly higher than pre-conflict levels. Stock markets, both in the U.S., Europe, and Asia, saw minimal shifts, indicating that traders were largely unfazed by the development. The article suggests that the U.S. has a considerable task ahead in convincing economists, investors, and nations engaged in trade with Iran that its threats of sanctions are to be taken with full seriousness.