How effective can US sanctions on Iran really be?

US President Donald Trump kept his promise, and new US sanctions are in full force. Their stated goal is to reduce Iran’s oil exports to zero. The sanctions cover even the shipping industry of Iran, citizens and companies from third countries doing business with Iran are also at risk of being sanctioned.

To me, total suspension of the Iranian oil export does not seem to be realistic. At least, a whole sea and land blockade is necessary to achieve this goal. At the same time, there are many allies and partners of the US among Iranian oil purchasers, and they could not give up Iranian oil immediately. It seems Washington understands this very well. In his speech in Hamilton Society, the Assistant to the President for National Security Affairs, John R. Bolton, stated the following:

“We want to achieve maximum pressure, but we don’t want to harm friends and allies either.” That’s why exceptions were made for eight countries.

However, we should not forget that the lion’s part of the Iranian’s export is oil and oil-products, so even the reduction in exports at half can finish off the already weak Iranian economy. Iran carries “the honorary title” of one of the world’s outcasts. During the years of sanctions and isolation, Iran has created many backdoors (illegal ports, schemes of oil and fuel smuggling, etc.). Even before the sanctions, some facts pointed to numerous efforts of Iran to use different tricks in oil exports. One of such tricks is to sell Iranian oil by presenting it as oil from another country.

There is also the unloading of Iranian oil off the coast of Malaysia. One of the most common methods to avoid sanctions is the use of “ghost tankers.” Iran began to practice these methods long before November 4. All these measures together can grant Iran a certain level of oil export and consequently fiscal revenue.

It will take, at least, a couple of months to understand how effective the US sanctions are. After the reduction of Iranian oil exports by, at least, one half, we can note the success of the strategy.

Trying to avert a crisis

Iran is in a deep social-economic crisis, caused not only by the US sanctions but also by environmental, ethnic and institutional issues, emanating from the character of the Iranian regime. Iran has faced a severe water crisis, which has already led to mass migration of rural people to cities and the reduction of farmlands. That would increase Iran’s food-import dependence and contribute to a price increase. The Iranian currency is actually in free fall. Undoubtedly, the Iranian rial will continue its devaluation, against the background of tougher sanctions. The regime’s repressions against religious and national minorities also makes the situation explosive.

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Despite the growing internal problems, the Iranian regime is not phasing down its expansionist policy and expenses. Billions of dollars are being spent on the arms expenditure and the maintenance of the repressive apparatus. Iran is involved in conflicts in Syria and Yemen, and Iranians fight for superiority in Lebanon and Iraq.

In Afghanistan, Iran is supporting Sunni radicals, Tehran tries to expand its influence to Bahrain, increase its influence in South Caucasus. Hundreds of millions of dollars are being spent annually on lobby and propaganda activities outside the country. Symptoms of a systemic crisis in Iran are already apparent. In general, Iran reminds us of the USSR in the second half of the 1980s.

Although the US officials claim that their primary goal is to force the Iranian regime to change their behavior, not a regime change, at this rate the regime can bring its economic and political collapse onto itself.

It is unlikely that Iran will accept all conditions imposed by the US and curtail its expansionist activity in the region and there are some compelling reasons. In this regard, we should refer to the character of the Iranian regime, to the mentality of the persons who represent it. Unlike North Korea, the Iranian regime is not the regime of one person.

First of all, giving up expansionism and support of terrorist organizations would be a demonstration of weakness, which will affect the credibility of the authorities within the country (it is essential in totalitarian regimes). It can also lead to division among the ruling elite.

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Secondly, there are powerful groups in Iran, who get large financial and political dividends from the Iranian expansionist policy.

No one in Tehran wants to be an object of their anger.

Since the 1980s, Iran has been consequently building a complex network of influence and terror in the Middle East, often with the complicity of the US, I should note. Tehran has spent giant financial recourses, gave many lives, and that’s why it seems unlikely that Iran might give up all of this, even under the threat of the US sanctions.

In addition, one of the US demands, for example, is to stop supporting Bashar al-Assad. A reasonable demand, but it can play against the US in the long-term. The point is, if Iranians withdraw from Syria, the part of Syria controlled by Bashar al-Assad will be passed to Putin completely. Right now, Iranians compete with Russians for the influence.

Taking the Iranians away, the US risks playing into the hands of Moscow. Developments in Georgia and Ukraine show that the West is powerless in squeezing Russia out of occupied territories. I believe all the risks and possible consequences should be weighed.

If the regime will not swerve from the path under the pressure of sanctions and will continue its activity, which seems a more likely scenario, then Washington will have to look for other methods of impact on Iran and its activity in the near future.

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Ali Hajizade is a political analyst and founder editor in chief of thegreatmiddleeast.com. He tweets @AHajizade.