President Trump is to reinstate all sanctions on Iran that were removed as part of the 2015 nuclear deal. The US withdrew from the deal in May, after Trump described it as “defective”.
The initial agreement meant Iran was limited in it’s controversial nuclear activities, and in return would receive relief from sanctions. Barack Obama, the US president at the time of the deal, argued that it would prevent Iran from developing nuclear weapons.
The sanctions are set to cover shipping, financial and energy sectors. Since Trump withdrew from the deal in May, this will be the second set of sanctions Iran has had reinstated.
With limited exceptions, the sanctions will penalize countries that don’t stop importing Iranian oil and foreign companies that do business with blacklisted Iranian entities, including Iran’s central bank, a number of private financial institutions and state-run port and shipping companies.
The sanctions will also have exceptions for humanitarian purchases.
Iran have accused Trump of causing “psychological warfare”, and they are now banned from developing a ballistic missile programme and intervening in neighbouring countries, including Syria and Yemen.
Iran’s oil output will be severely impacted. In 2013 Iran saw a low of 2.5 million barrels being produced per day, but since the sanctions we lifted they have seen 3.7 million barrels being produced every day. This is expected to drop to 2013 levels.
China are the largest importers of the Iranian oil, bringing in roughly 700,000 barrels a day, with India second, importing 550,000 barrels a day.
This could see Iran’s GDP growth rate decline for the first time since the sanctions we lifted.
Trump claims that this isn’t the end though, and in addition to the November sanctions, saying:
“[The US] will pursue additional sanctions, tougher than ever before, to counter the entire range of Iran’s malign conduct. Any individual or entity who fails to comply with these sanctions will face severe consequences.”