The US move comes just days after the Trump administration announced an embargo on Iran’s sales of oil, providing a boost to Tehran’s efforts to deny those sanctions cash.
Trump has previously refused to hold Iran accountable for the sanctions imposed over its nuclear programme and has placed sanctions on its Revolutionary Guard Corps and on the Central Bank.
But his administration, led by Treasury Secretary Steven Mnuchin, can remove the measures for up to three years after the US has carried out re-imposition of sanctions, meaning that in the near future, Tehran would likely face no further US measures.
That looks like a no-win situation for Washington and could seriously weaken US diplomatic efforts to induce Tehran to return to the table for peace talks.
‘Here’s the problem, and you’re just going to have the same problem that it has now: the costs of sanctions are not going to come back down, even if they did,’ said Robert Wood, a former American ambassador to the UN who helped negotiate the nuclear deal.
A separate US-led embargo on ballistic missiles planned for launch has also been knocked back by the UN Security Council, creating a new front that could theoretically unleash more economic sanctions and make it difficult for Washington to roll back Tehran’s revolutionary influence across the Middle East.
Last week, Iran expelled US diplomats in retaliation for the US launching sanctions on its oil industry last month.
‘All of the heavy lifting for these sanctions have been done by countries around the world,’ said Emanuel Kumer, a Moscow-based expert on Russian-Iranian relations and a former ambassador to Afghanistan.President Donald Trump, right, signing executive orders imposing sanctions on banks and companies linked to Iran’s Revolutionary Guard on September 9, 2018 in the Rose Garden of the White House in Washington, DC
‘So Iran doesn’t have this army all to itself, the Revolutionary Guard is in such a condition where it’s prohibited from any purchase of weapons.
‘They need to figure out what the next step is,’ Kumer added.
Meanwhile, US sanctions on Iran’s state-run oil and banking sector will take effect in the coming weeks and be fully implemented by December 15.
Under the new sanctions, US banks will have to stop providing businesses with vital financial information. This includes customers and interbank dealings in Iran, sources said, but it is not yet clear how many customers could face sanctions.
Under a new embargo placed by President Donald Trump last week, US banks will be barred from dealing with corporations linked to Iran’s Revolutionary Guard, effectively banning them from doing business with the Guards.
The White House has previously argued that the sanctions are necessary to force Iran to come to the negotiating table over its nuclear programme.
But these new US sanctions allow the Trump administration to contain the radical Islamic republic and to charge Iran with obstructing US efforts to negotiate a final settlement.
However, Iran and its allies – Russia, China, the United Arab Emirates and Saudi Arabia – are threatening to block an international deal with world powers if the US continues to bomb Syria.
‘The international community wants a solution and wants this conflict to be over, not stifle the efforts of the international community,’ Kremlin spokesman Dmitry Peskov said earlier this month.
Juan Zarate, an associate fellow at the Centre for a New American Security, called the sanctions and diplomacy ‘a new reality’ and said Washington’s threat to sabotage international talks was increasingly limited.
‘The general consensus in the region and among governments and experts is that the Iranian economy is close to self-destruction,’ Zarate said.‘They want to find a solution but I do not believe that they are prepared to strike away the economy until they find a solution.’
As recently as July, Vice President Mike Pence said the US could not ‘let Iran stop thinking like a nuclear power’.
He told Fox News’ ‘Fox & Friends’ program, ‘and we will not let them break the economic and diplomatic links to the rest of the world.‘We are not interested in any unilateral breakout of our means of pressure. So how could we prevent Iran from achieving those weapons of mass destruction by shutting down those crucial Iran financial links that all of us work to ensure will be broken and that other countries will stop supporting?’