Iran’s oil exports have already dropped precipitously in anticipation of the reintroduction of U.S. sanctions, and this month its ministers of finance and labor, along with the head of its central bank, have been pushed out of office. These and other, similar signs suggest that the Islamic Republic is already suffering from Washington’s withdrawal from the 2015 nuclear deal. Now, argue Richard Goldberg and Jacob Nagel, the U.S. ought to take even harsher economic measures, which could—notwithstanding the supreme leader’s avowed refusal to hold talks—force Tehran to accept effective restrictions on its nuclear program:
Iran’s rejection of talks makes sense for now. The toughest sanctions suspended under the Obama administration’s Iran nuclear deal, or Joint Comprehensive Plan of Action, are not scheduled to return until November. That gives Germany, Turkey, Russia, and other countries doing business with Iran two more months to find workarounds that can help the regime survive, including pressuring the Belgium-based SWIFT financial-messaging service to keep Iran’s Central Bank connected to the international financial system. Iran, therefore, will want to wait for November to see whether any countries are successful in evading U.S. sanctions and, most importantly, whether their banks remain connected to SWIFT.
In addition to plotting various sanctions-evasion schemes, Iran’s leaders also might try to expand their nuclear and missile activities in hopes of regaining leverage. The Trump administration would be wise to focus on both tracks. Maximum pressure should come with maximum isolation, particularly in nuclear and missile sciences, to slow any regime attempt to advance its weapons program.
Though often overshadowed by high-profile oil and financial sanctions, key restrictions targeting civilian nuclear cooperation with Iran will return in November, too. Hundreds of people inside Iran’s Atomic Energy Organization, Defense Ministry, and Islamic Revolutionary Guard Corps (IRGC) will return to the U.S. Treasury Department’s blacklist. Under U.S. law, the procurement channel to Iran established by the nuclear deal will be off-limits to all foreign companies, including banks and insurers. Stopping the sale of dual-use equipment will again become a U.S. priority. . . .
These steps, alongside a sustained financial-warfare campaign, could be enough to convince the supreme leader that his regime’s only chance of survival is behavioral change. To increase the pressure, the Trump administration should target SWIFT’s board members with sanctions unless the cooperative disconnects Iranian banks. Trump should also consider imposing sanctions on the financial sector of Iran in its entirety, and blacklisting any other economic sector in Iran that has ties to the IRGC.
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