Trump reimposes sanctions against Iran: what now?

The re-imposition of the full panoply of sanctions against Iran, lifted under the Comprehensive Plan of Action Agreement for the Global Plan of Action (JCPOA), constitutes a Highlight for President Donald Trump's foreign policy.

He had long opposed this agreement, which most analysts regard as one of the most important achievements of his predecessor, Barack Obama, in foreign policy.

The goal of the Trump administration is now to exert maximum pressure on the Iranian regime in order to force it to think again and change what Americans regard as its perverse behavior in the region.

What exactly are the measures that are re-imposed and what will be their likely impact? Will this mark the definitive disappearance of the JCPOA? And what is the real American strategy behind the sanctions effort? All of these questions have no clear or definitive answers.

The sanctions that are re-imposed are the most damaging to the Iranian economy – targeting its oil sales, its energy sector in the broad sense, shipping, banks, insurance, etc. These are largely what are known in the trade as "secondary sanctions", in the sense that they are intended to put pressure on other countries to prevent them from trading with Tehran.

The idea is to dissuade them from buying Iranian oil, which represents a huge proportion of Iran's income. In addition, hundreds of individuals and named entities will be sanctioned.

There will be no sudden collapse of Iranian incomes. Indeed, much of the damage has already been caused.

The pressure has increased since the initial announcement of President Trump last May. US authorities claim that since then, Iran's daily oil exports have dropped significantly – by more than a third.

Foreign companies had to decide what mattered most to them: business with Iran or the United States. Many major players have already announced the end of projects in Iran.

Knowing that sanctions were coming, many companies have already made their decisions.

Several Iranian customers could continue to buy oil and the United States is about to do so. In the past, under the Obama administration, these exceptions were called "significant exemptions for abatement" and actually meant that if countries promised to significantly reduce their oil purchases from Iran, the administration would not would not seek to punish them for carrying out certain trade. .

This made sense as it helped US allies such as Taiwan, South Korea and Japan to manage their energy problems while aligning with the broad lines of US policy. India has also benefited from exemptions and China has reduced its purchases under a slightly different arrangement.

The Trump administration has already indicated that it is also willing to grant countries like India and several other such exemptions. National Security Advisor John Bolton said this week that: "We want to reach the maximum of pressure (on Iran), but we do not want to hurt friends and allies either."

Earlier, the Trump administration had insisted that oil imports from Iran should be reduced to zero.

The behavior of China – Beijing is a major trading partner of Tehran – will be decisive. It is also likely to continue to buy Iranian oil without incurring sanctions.

There is a logic here. Will the United States really hit Beijing with damaging secondary sanctions that would actually mean risk of economic war, given the difficult situation of the wider trade relations between the two countries? Probably not.

Uncertainty to come?

The United States must also be concerned about the overall stability of the international oil market, especially given the political uncertainties in Saudi Arabia. Indeed, it can be expected that the Saudis will pump more oil to offset the Iranian crude oil cuts.

Another uncertainty comes from the efforts of the European Union to strengthen the Iranian nuclear deal by seeking to protect its own companies from US sanctions. There is also talk of establishing an alternative payment system that does not involve the US dollar or banks. But experts in Washington – even those who criticize the Trump administration's approach – remain extremely skeptical about the fact that EU efforts, in the short term, will make a big economic difference.

The general view is that the EU's statements are largely aimed at sending Tehran a powerful political signal of opposition to President Trump's approach. This does not mean that they would not want Iranian missile programs to be subject to constraints or a change in regional behavior in Tehran. But they think that the JCPOA (remember that France, Germany, the United Kingdom and the European Union are all signatories) remains a useful constraint for Iran's nuclear activities and should not be spilled lightly.

So is the JCPOA now condemned? Not necessarily. Some experts believe that if China and other customers like India continue to buy a reasonable level of Iranian oil and if the EU maintains its political support for the agreement, then Iran could stick to it for the moment. However, once the sanctions begin to be felt – perhaps causing new economic troubles – the fate of JCPOA will depend on the complex political battles between moderates and extremists in Tehran.

All this raises the question: what is really the purpose of the Trump administration in all of this? In appearance, it is a question of bringing Iran back to the negotiating table to obtain a better and more global agreement.

But many analysts believe that such a decision on the part of Tehran is highly unlikely and the scope of US claims suggests that the true goal of the Trump administration is to produce regime change in Tehran.

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As a Trump policy expert told me: "In the end, the problem is that the administration does not have a real plan, it knows how to use a single tool, namely sanctions, but a strategy. " White Jarrett, a former Obama era official who has managed the implementation of the JCPOA, says that in giving up the deal, "the US has exploded their ability to make promises. credible. "

Thus, in the immediate future, Iran will try to resist the pressure of sanctions: its oil sales will be reduced significantly, but it will retain some of its customers. The United States will persevere in its current approach to isolating Tehran – but without the broad international support of the sanctions regime before the JCPOA negotiations.

Few analysts believe that Iran 's foreign policy in the region will change a lot. They say that it is based on strategic and ideological concerns, rather than just economic ones, and that, in any case, its activities in Lebanon, Syria and Gaza are probably not expensive enough to overcome these other priorities.

Nevertheless, the Trump administration is clearly determined to increase pressure on Tehran. Above all, it wants to stifle the funds allocated to the body of the Iranian Revolutionary Guards responsible for conducting numerous Iranian operations abroad.

This is part of a more general policy of containment, in which Israel (through its actions in Syria) and Saudi Arabia (through its campaign in Yemen) are also involved. But Israel is already facing problems with Russia and the question of the future of the Saudi war in Yemen is immense.

So much remains unclear on Trump's approach. Can he convince his allies, could he really impose sanctions on the countries trading with Iran and how long will the exemptions on oil purchases last? What will be the impact on Iranian society and its politics? And in the midst of this whirlwind, can the JCPOA survive in a meaningful form?

But there is also a broader, longer-term question about US policy regarding Washington's increasing reliance on the tool of economic sanctions. Many believe that they are overexploited and that the threat of secondary sanctions runs counter to US objectives.

Europeans are not alone: ​​Russia and China are also considering developing alternative international payment systems.

We could look back – maybe in a decade – and say that it was the moment when the utility of US economic sanctions as a diplomatic weapon began to erode.