The Trump administration on Friday announced the reimposition of all US sanctions on Iran that had been lifted under the 2015 nuclear deal, ramping up economic pressure on the Islamic Republic as President Donald Trump completed the unravelling of what had been one of his predecessor's signature foreign policy achievements.
The sanctions, which will take effect on Monday, cover Iran's shipping, financial and energy sectors and are the second batch the administration has reimposed since Trump withdrew from the landmark accord in May.
The rollback ends US participation in the nuclear deal, which now hangs in the balance as Iran no longer enjoys any relief from sanctions imposed by the world's largest economy.
Shortly after the announcement, Trump tweeted a movie poster-like image of himself walking out of what appears to be fog with the phrase “Sanctions are Coming, November 5.”
With limited exceptions, the sanctions will hit countries that do not stop importing Iranian oil and foreign firms that do business with blacklisted Iranian entities, including its central bank, a number of private financial institutions, and state-run port and shipping firms, as well as hundreds of individual Iranian officials.
Secretary of State Mike Pompeo said the sanctions are “aimed at fundamentally altering the behaviour of the Islamic Republic of Iran.” He has issued a list of 12 demands that Iran must meet if it wants the sanctions lifted. Those include ending support for terrorism and military engagement in Syria and a complete halt to its nuclear and ballistic missile development.
“Our ultimate aim is to compel Iran to permanently abandon its well-documented outlaw activities and behave as a normal country,” Pompeo told reporters in a conference call with Treasury Secretary Steven Mnuchin. “Maximum pressure means maximum pressure.”
Pompeo said eight nations will receive temporary waivers allowing them to continue to import Iranian petroleum products for a limited period as they move to end such imports entirely. He said those countries, which other officials said would include US allies such as Turkey, Italy, India, Japan and South Korea, had made efforts to eliminate their imports but could not complete the task by Monday.
The waivers, expected to be announced on Monday, will be valid for six months, during which time the importing country can buy Iranian oil but must deposit Iran's revenue in an escrow account. Iran can spend the money but only on a narrow range of humanitarian items. Pompeo said two of the eight countries would wind down imports to zero within weeks.
Mnuchin said 700 more Iranian companies and people would be added to the sanctions rolls. Those, he said, would include more than 300 that had not been included under previous sanctions.
“We are sending a very clear message with our maximum pressure campaign: that the U.S. intends to aggressively enforce our sanctions,” he said.
Iran hawks in Congress and elsewhere were likely to be disappointed in the sanctions as they had been pushing for no oil import waivers as well as the complete disconnection of Iran from the main international financial messaging network known as SWIFT.
One group that has been highly critical of the deal welcomed the new sanctions but said there should be no exceptions.
“We encourage the Trump administration to fulfill the promise of a maximum pressure campaign no exceptions until Iran permanently and verifiably changes its behaviour,” United Against a Nuclear Iran said in a statement. “Oil and gas firms, including those from friendly countries like India, South Korea and Japan, should not be granted sanctions waivers. Similarly, financial entities including SWIFT must sever ties with Iranian banks and financial institutions.”
Mnuchin defended the decision to allow some Iranian banks to remain connected to SWIFT, saying that the Belgium-based firm had been warned that it will face penalties if sanctioned institutions are permitted to use it. And, he said that US regulators would be watching closely Iranian transactions that use SWIFT to ensure any that run afoul of US sanctions would be punished.
Pompeo, meanwhile, defended the oil waivers, saying US efforts to cut Iran's petroleum revenue had already been successful. He noted that since May, when the US began to press countries to stop buying Iranian oil, Iran's exports had dropped by more than 1 million barrels per day.
Pompeo and Mnuchin both said the sanctions will have exceptions for humanitarian purchases.
The 2015 nuclear deal, one of former President Barack Obama's signature foreign policy achievements, gave Iran billions of dollars in sanctions relief in exchange for curbs on its nuclear programme, which many believed it was using to develop atomic weapons.
Trump repeatedly denounced the agreement as the “worst ever” negotiated by the United States and vowed to withdraw from it during the 2016 presidential campaign.
Trump and other critics of the deal said it gave Iran too much in return for too little, allowed Iran to gradually resume nuclear activity that could eventually be used for weapons development and did not address any of the country's other problematic activities.
Obama-era officials, as well as the other parties to the deal Britain, China, France, Germany, Russia and the European Union, have vehemently defended it. The Europeans have mounted a drive to save the agreement from the US withdrawal, fearing that the new sanctions will drive Iran to pull out and resume all of its nuclear work.