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There have been a number ofinternational sanctions against Iran imposed by a number of countries, especially theUnited States, and international entities.Iran was the most sanctioned country in the world until it was surpassed byRussia, following Russia'sinvasion of neighboring Ukraine in February 2022.[1]
The first sanctions were imposed by the United States in November 1979,[2] after a group ofradical studentsseized the American Embassy in Tehran and took hostages. These sanctions were lifted in January 1981 after the hostages were released, but they were reimposed by the United States in 1987 in response to Iran's actions from 1981 to 1987 against the U.S. and vessels of other countries in thePersian Gulf and US claims ofIranian support for terrorism.[3] The sanctionswere expanded in 1995 to include firms dealing with the Iranian government.[4]
The third sanctions were imposed in December 2006 pursuant toUnited Nations Security Council Resolution 1737 after Iran refused to comply withUnited Nations Security Council Resolution 1696, which demanded that Iran halt itsuranium enrichment program. Initially, U.S. sanctions targeted investments inoil, gas, and petrochemicals, exports of refined petroleum products, and business dealings with theIslamic Revolutionary Guard Corps (IRGC). It encompassedbanking and insurance transactions (including with theCentral Bank of Iran),shipping,web-hosting services for commercial endeavors, anddomain name registration services.[5] Subsequent UN Resolutions have expanded sanctions against Iran.
Over the years, sanctions have taken a serious toll on Iran's economy and people. Since 1979, the United States led international efforts to use sanctions to influence Iran's policies,[6] including Iran's uranium enrichment program, which Western governments feared was intended for developing the capability to producenuclear weapons. Iran countered that its nuclear program is for civilian purposes, including generating electricity and medical purposes.[7]
When nuclear talks between Iran and Western governments were stalled and seen as a failure,U.S. senators cited them as a reason to enforce stronger economic sanctions on Iran.[8] On 2 April 2015, theP5+1 and Iran, meeting inLausanne, Switzerland, reached a provisional agreement on aframework that, once finalized and implemented, would lift most of the sanctions in exchange for limits on Iran's nuclear programs extending for at least ten years.[9][10][11][12] The final agreement, theJoint Comprehensive Plan of Action (JCPOA), was adopted on 18 October 2015.[13] As a result, UN sanctions were lifted on 16 January 2016.[14] On 8 May 2018,U.S. PresidentDonald Trump announced that the United States wouldwithdraw from the Iran nuclear deal. Sanctions by the United States were reinstated in November 2018, and expanded in 2019 and 2020 to cover Iran's financial sector. Temporary waivers were granted to some countries to continue importing reduced amounts of oil from Iran until 2019.
On 21 February 2020, Iran was placed on theFATF blacklist.[15]
The UN arms embargo on Iran expired on 18 October 2020, as agreed inIran's 2015 nuclear deal, allowing Iran to import foreign military equipment.
Since October 2024, Iran has once again been placed on the official blacklist of theFinancial Action Task Force (FATF), primarily due to its failure to implement laws againstterrorist financing, particularly in connection with its support for theAxis of Resistance.[16][17] Subsequently, in March 2025, theFederal Financial Supervisory Authority (BaFin) published a report warning German companies against trading with Iran.[18]
On 28 August 2025, E3 members,France,Germany, and theUnited Kingdom, initiated the process of the snapback mechanism,[19] stating that despite upholding their own commitments, since 2019 Iran had "increasingly and deliberately ceased performing its JCPOA commitments",[20] including "the accumulation of a highly enriched uranium stockpile which lacks any credible civilian justification and is unprecedented for a state without a nuclear weapons program".[20]
TheUnited States sanctions against Iran were imposed in November 1979 afterradical studentsseized the American Embassy in Tehran and took hostages.[21][22] The sanctions were imposed byExecutive Order 12170, which included freezing about $8.1 billion in Iranian assets, including bank deposits, gold and other properties, and atrade embargo. The sanctions were lifted in January 1981 as part of theAlgiers Accords, which was anegotiated settlement of the hostages' release.[23]
While theIran–Iraq War, which began in September 1980, was in progress, in 1984, United States sanctions prohibited weapon sales and all U.S. assistance to Iran. In September 1987, following the discovery of a possible minefield in the Strait of Hormuz,Secretary of DefenseCaspar Weinberger called for a UN arms embargo against Iran,[24] but Weinberger's call was not realized at the time.[citation needed]
In 1995, in response to theIranian nuclear program and Iraniansupport of terrorist organisations, includingHezbollah,Hamas, andPalestinian Islamic Jihad, U.S. PresidentBill Clinton issued severalexecutive orders with respect to Iran.Executive Order 12957 of 15 March 1995, banned U.S. investment in Iran's energy sector, andExecutive Order 12959 of 6 May 1995, banned U.S. trade with andinvestment in Iran.
TheIran and Libya Sanctions Act (ILSA) was signed on 5 August 1996 (H.R. 3107, P.L. 104–172).[25] (ILSA was renamed in 2006 the Iran Sanctions Act (ISA) when the sanctions against Libya were terminated.[25]) On 31 July 2013, members of theUnited States House of Representatives voted 400 to 20 in favor of toughened sanctions.[26]
On 8 May 2018,U.S. PresidentDonald Trump announced that the United States wouldwithdraw from the Iran nuclear deal.[27][28] Following the U.S. withdrawal, the EU enacted an updatedblocking statute on 7 August 2018 to nullify US sanctions on countries trading with Iran.[29]
The fourth set of sanctions by the United States came into effect in November 2018; theWhite House said that the purpose of the sanctions was notregime change, but to make Iran to change its regional policies, stop its support for regional militant groups and end itsballistic missile programme.[30] In September 2019, a U.S. official stated that the United States will sanction whoever deals with Iran or purchases its oil.[31] Also in September 2019, in response to a suspected Iranian attack on key Saudi Arabian oil facilities, Trump said that he directed the Treasury Department to "substantially increase" sanctions on Iran. The new sanctions targeted the Iranian national bank.[citation needed] A senior Trump administration official said the new sanctions targeted the financial assets of the Supreme Leader's inner circle.[32] However, according to the New York Times, Tehran has disclaimed playing any part in the attacks that affected the Saudi oil facilities.[33]
On 25 August 2020, the United Nations Security Council blocked the effort of the US to re-impose snapback sanctions on Iran. ThePresident of the UN Security Council,Indonesia's ambassadorDian Triansyah Djani, stated he is "not in a position to take further action" on US's request, citing a lack of consensus in the Security Council on the US strategy as the main reason.[34]
On 20 September 2020, the US asserted that UN sanctions against Iran were back in place, a claim that was rejected by Iran and the other remaining parties to the JCPOA.[35][36] The next day, the United States imposed sanctions on Iranian defence officials, nuclear scientists, the Atomic Energy Agency of Iran and anyone who engaged in conventional arms deals with Iran.[37] On 8 October 2020, the US imposed further sanctions on Iran's financial sector, targeting 18 Iranian banks.[38]
In February 2023,Deutsche Welle, during a report on the increase in Iran's oil exports, claimed that pressuring Iran has diplomatic costs for Washington and will ultimately lead to an increase in oil prices.[39]
On April 22, 2025, the U.S. Department of the Treasury imposed sanctions on Iranian businessman Reza Zarrab and his network of companies for facilitating the sale of Iranian liquefied petroleum gas (LPG) in violation of U.S. sanctions. Zarrab, previously implicated in sanctions evasion schemes, is accused of using a complex network of front companies and intermediaries to export Iranian LPG, generating significant revenue for Iran's energy sector. The sanctions aim to disrupt these illicit financial networks and reinforce the U.S. commitment to enforcing sanctions against Iran's energy exports. As a result, all property and interests in property of the designated individuals and entities within U.S. jurisdiction are blocked, and U.S. persons are generally prohibited from engaging in transactions with them.[40]
In July 2023, British Foreign Secretary James Cleverly announced that his government had decided to create a new sanctions regime for Iran, which will expand the United Kingdom's powers to sanction decision-makers in Tehran to include those allegedly involved in weapons proliferation.[41][42] This decision could be motivated a number of different factors, such as Iran recently being accepted as a full member of the Shanghai Cooperation Organisation (SCO).[43] On 30 October 2025 it was reported that the UK added sanctions on Iranian banker Aliakbar Ansari, for his support to Iran's Revolutionary Guards.[44][45]
The UN Security Council passed a number of resolutions imposing sanctions on Iran, following the report by theInternational Atomic Energy Agency Board of Governors regarding Iran's non-compliance with its safeguards agreement and the Board's finding that Iran's nuclear activities raised questions within the competency of the Security Council. Sanctions were first imposed when Iran rejected the Security Council's demand that Iran suspend all enrichment-related and reprocessing activities. Sanctions will be lifted when Iran meets those demands and fulfills the requirements of the IAEA Board of Governors. Most UN sanctions were lifted on 16 January 2016, following the Joint Comprehensive Plan of Action.
The UN sanctions against Iran do not include oil exports from Iran.[48] As of 2019, an estimated one third of all oil traded at sea passes through theStrait of Hormuz. In August 2018, EU High Representative Mogherini, speaking at a briefing with New Zealand's Foreign MinisterWinston Peters, challenged U.S. sanctions on Iran, stating that the EU are encouraging small and medium size enterprises in particular to increase business with and in Iran as part of something that is for the EU a "Security Priority".[49][50]
In September 2019, the US government announced, unilaterally, that it would begin to sanction certain Chinese entities that imported oil from Iran.[51]
On 14 August 2020, theUnited Nations Security Council rejected a resolution proposed by the United States to extend the global arms embargo on Iran, which was set to expire on 18 October 2020. The Dominican Republic joined the United States in voting for the resolution, short of the minimum nine "yes" votes required for adoption. Eleven members of the Security Council, includingFrance,Germany, and theUnited Kingdom, abstained whileRussia andChina voted against the resolution.[52]
Speaking about the US desire to restore UN sanctions against Iran and extend an embargo to arms sales to the country in 2020,US Ambassador to the United NationsKelly Craft said: "History is replete of tragedies of appeasing regimes such as this one, that for decades have kept its own people under its thumb. The Trump administration has no fear in standing in limited company on this matter, in light of the unmistakable truth guiding our actions. I only regret that other members of this [Security Council] have lost their way, and now find themselves standing in the company of terrorists."[53] She also wrote a September 20, 2020, letter to the President of the UN Security Council, pressing her point on sanctions.[54][55][56] Speaking at the US State Department in September 2020, she said: "As we have in the past, we will stand alone to protect peace and security at all times. We don't need a cheering section to validate our moral compass."[55]
Under the terms agreed in theIran nuclear deal framework, the UN arms embargo expired on 18 October 2020, following which Iran was permitted to purchase foreign weapons and military equipment.[57] A U.S. attempt to extend UN sanctions against Iran under aJCPoA "snapback" provision was opposed by 13Security Council members, who argued that theU.S. left the agreement with Iran in 2018.[58]
In July 2025, E3 members, Britain, France and Germany, warned that the snapback mechanism would be triggered if no progress was made in the nuclear talks by the end of August 2025.[59] As a result, Iran turned toRussia andChina in order to discuss the threat of sanctions and to strengthen the military ties between them.[59]
On 14 July 2025, amid possible snapback activation by E3,Foreign Ministry spokesman Esmaeil Baqaei warned of consequences[60] and threatened that should it be triggered it would "be met with a proportionate and appropriate response",[61] without elaborating.[62]
On 25 July 2025, after Iranian foreign minister declared that Iran would not abandon its nuclear program nor would it ever halt its enrichment of uranium,[63] negotiations between E3 and Iran were held in Istanbul.[60] Iran's Deputy Foreign MinisterKazem Gharibabadi warned that triggering sanctions "is completely illegal", and Iranian diplomats threatened that Iran would leave the global nuclear non-proliferation treaty if U.N. sanctions were to be reinstated.[60]
On 8 August 2025, after Iran did not respond to an offer of extension for the negotiation deadline, E3 sent a letter to the UN in which they declared that they were prepared to trigger the snapback mechanism "should no satisfactory solution be reached by the end of August 2025".[64] In response,Iranian Parliament member of the Commission on National Security and Foreign Policy, Amir Hayat Moghadam, stated that all of Europe, and in particularBritain,France andGermany is in range of Iranian missiles, while major US cities such asWashington andNew York, may be targeted by missiles launched from the sea.[65][66][67] Simultaneously, according to the Telegraph, senior officials of the Islamic Republic stated that it would not have the financial or military ability to withstand the snapback sanctions, and that their consequences would be more damaging than war.[68]
As Resolution 2231 and theJCPOA approach their scheduled expiration on 18 October 2025, the Security Council faces a final opportunity to invoke the snapback mechanism. This mechanism allows any JCPOA participant to notify the Council of significant Iranian non-compliance, thereby triggering the automatic reimposition of previously lifted UN sanctions unless a new resolution to maintain sanctions relief is adopted within 30 days. The process is not subject to veto by permanent Council members. The European parties to the JCPOA -France, theUnited Kingdom, andGermany - have signaled a potential willingness to consider this step, contingent upon findings from forthcoming reports by theInternational Atomic Energy Agency (IAEA) regarding Iran's adherence to its nuclear commitments.[69]
If activated, the snapback mechanism is expected to have wide-reaching implications for Iran's energy sector. Reimposed sanctions would likely affect oil and gas exports, maritime shipping, banking, and insurance, while also restricting access to international financial systems and deterring foreign investment. Ongoing efforts to modernize production infrastructure could be disrupted, and access to vital equipment and technology may be curtailed. Iranian officials have responded to the potential reactivation of the snapback mechanism with threats of escalatory measures, including a shift in military posture, withdrawal from theNuclear Non-Proliferation Treaty (NPT), and increased regional destabilization through proxy activity and maritime disruptions.[70]
On 28 August 2025, E3 members, France, Germany, and the United Kingdom, initiated the process of the snapback mechanism, with the prospect of freezing Iranian overseas assets, blocking arms deals with Iran, imposing penal action against development of Iran's ballistic missile program and further restricting Iran's military and nuclear activities.[19] In a letter addressed to the president of the UN Security Council, the foreign ministers of the E3 stated that since 2019, Iran had "increasingly and deliberately ceased performing its JCPOA commitments", including "the accumulation of a highly enriched uranium stockpile which lacks any credible civilian justification and is unprecedented for a state without a nuclear weapons program".[71] The letter detailed additional Iranian violations of the agreement despite the fact that the E3 "have consistently upheld their agreements under the terms of the JCPOA".[71] The activation opened a 30-day window, intended to reengage Iran, "whose refusal to cooperate with the International Atomic Energy Agency's (IAEA) inspectors started the crisis",[19] in diplomatic negotiations before full restoration of sanctions.[19] Iran's Foreign Minister Abbas Araghchi declared that it was "unjustified, illegal, and lacking any legal basis" and promised that "The Islamic Republic of Iran will respond appropriately".[19][72]
In June 2007, leading EU countries including Britain, France, and Germany cautioned Iran that it faced further sanctions for expanding uranium enrichment and curbing U.N. inspectors' access to its nuclear program. "Iran continues to ignore its obligations and has not taken any steps to build confidence in the exclusively peaceful nature of its program". Additionally, the EU offered Iran suspension of sanctions and a package of trade and industrial benefits if it suspends its nuclear program.[73]
EU–Iran relations have been strained in the early 2010s by the dispute over theIranian nuclear program. The European Union along with the United States have imposed sanctions against Iran over the controversies aroundIranian nuclear program. These sanctions which have been described as the toughest EU sanctions imposed against any other country by European officials were last strengthened on 15 October 2012 within by the EU Council.[74][2]
On 23 January 2012, the Council of the European Union released a report in which it restated its concerns about the growth and nature of Iran's nuclear programme.[75] As a result, the council announced that it would levy anembargo on Iranian oil exports. Further, it stated that it would also freeze assets held by theCentral Bank of Iran and forestall the trading of precious metals and petrochemicals to and from the country.[76] This replaces and updates the previous Council Regulation 423/2007 that was published on 27 July 2010. The new sanctions put restrictions on foreign trade, financial services, energy sectors and technologies and includes a ban on the provision of insurance and reinsurance by EU insurers to the State of Iran and Iranian-owned companies.[77]Iran has since declared its intentions to close theStrait of Hormuz should the embargo be enacted.[78] At the time, the European Union accounted for 20% of Iran's oil exports, with the majority of the remaining being exported to Asian countries such asChina,Japan,India, andSouth Korea.[79]
In response to the sanctions,Ramin Mehmanparast, representative for Iran's foreign ministry, stated that the embargo would not significantly affect Iranian oil revenues. He further said that "any country that deprives itself from Iran's energy market, will soon see that it has been replaced by others."[80]
In addition, Iran's parliament considered a law that would pre-empt the EU ban by cutting off shipments to Europe immediately, before European countries could arrange alternate supplies.[81]
On 12 April 2021, the European Union sanctioned eight Iranian militia commanders and security officials over human right abuses.[82]
In September 2023, it was announced that certain sanctions imposed by France, Germany and the UK on Iran would be retained. These sanctions were due to be lifted the following month under the JCPOA, but a decision was made to retain them in order to deter Tehran from selling drones and missiles to Russia.[83]
In May 2024, the European Union expanded the scope its sanctions regime against Iran, this time banning EU sales of components formissiles in addition tounmanned aerial vehicles, which were covered by a sanctions framework adopted in July 2023.[84]
In April 2025, the European Union imposed sanctions on seven Iranian prison and judicial officials, as well as two institutions, in response to what it described as a politically motivated campaign by Iran to detain EU citizens. The sanctions, which include asset freezes and travel bans, targeted individuals such as Hedayatollah Farzadi, head of Tehran'sEvin Prison, and entities like Shiraz Central Prison (Adelabad Prison) and the Revolutionary Court of Shiraz. The EU cited severehuman rights violations, including arbitrary detentions, denial of fair trials, and mistreatment of detainees.France, having two nationals detained under reportedly inhumane conditions, led the initiative and is preparing a complaint at the International Court of Justice, alleging violations of consular rights.[85][86]
On 17 March 2012, following agreement two days earlier between all 27 member states of theCouncil of the European Union, and the council's subsequent ruling, theSWIFT electronic banking network, the world hub of electronic financial transactions, disconnected all Iranian banks from its international network that had been identified as institutions in breach of current EU sanctions, and that further Iranian financial institutions could be disconnected from its network.[87]
 | This section needs to beupdated. Please help update this article to reflect recent events or newly available information.(January 2017) |
| Sectors | U.S. (1995– ) | E.U. (2007– ) | U.N. (2006–16) |
|---|---|---|---|
| Missile/arms industry | Restricted | Restricted | Removed |
| Islamic Revolutionary Guard Corps | Restricted | Restricted | Removed |
| Nuclear industry | Restricted | Restricted | Removed |
| Energy/petroleum industry | Restricted | Restricted | Removed |
| Banking | Restricted | Restricted | Removed |
| Central Bank of Iran | Restricted | Restricted | Removed |
| Shipping industry | Restricted | Restricted | Removed |
| International trade | Restricted | Restricted | Removed |
| Insurance | Restricted | Restricted | Removed |
| Foreign firms dealing with Iran | Restricted |
TheEuropean Union has imposed restrictions on cooperation with Iran in foreign trade, financial services, energy sectors and technologies, and banned the provision of insurance and reinsurance by insurers in member states to Iran and Iranian-owned companies.[77] On 23 January 2012, the EU agreed to an oil embargo on Iran, effective from July, and to freeze the assets of Iran's central bank.[89] The next month, Iran symbolically pre-empted the embargo by ceasing sales to Britain and France (both countries had already almost eliminated their reliance on Iranian oil, and Europe as a whole had nearly halved its Iranian imports), though some Iranian politicians called for an immediate sales halt to all EU states, so as to hurt countries like Greece, Spain and Italy who were yet to find alternative sources.[90][91]
On 17 March 2012, all Iranian banks identified as institutions in breach of EU sanctions were disconnected from theSWIFT, the world's hub of electronic financial transactions.[92] On 10 November 2018, Gottfried Leibbrandt, chief executive of SWIFT said inBelgium that some banks in Iran would be disconnected from this financial messaging service.[93]
One side effect of the sanctions is that the global shipping insurers based in London are unable to provide cover for items as far afield as Japanese shipments of Iranianliquefied petroleum gas to South Korea.[94]
In 2012, the U.S. Department of State stated:
In response to Iran's continued illicit nuclear activities, the United States and other countries have imposed unprecedented sanctions to censure Iran and prevent its further progress in prohibited nuclear activities, as well as to persuade Tehran to address the international community's concerns about its nuclear program. Acting both through the United Nations Security Council and regional or national authorities, the United States, the member states of the European Union, Japan, the Republic of Korea, Canada, Australia, Norway, Switzerland, and others have put in place a strong, inter-locking matrix of sanctions measures relating to Iran's nuclear, missile, energy, shipping, transportation, and financial sectors.These measures are designed: (1) to block the transfer of weapons, components, technology, and dual-use items to Iran's prohibited nuclear and missile programs; (2) to target select sectors of the Iranian economy relevant to its proliferation activities; and (3) to induce Iran to engage constructively, through discussions with the United States, China, France, Germany, the United Kingdom, and Russia in the "E3+3 process," to fulfill its nonproliferation obligations. These nations have made clear that Iran's full compliance with its international nuclear obligations would open the door to its receiving treatment as a normal non-nuclear-weapon state under the Nonproliferation Treaty and sanctions being lifted.[123]
The website of the U.K. government states:
On 16 October 2012, the EU adopted a further set of restrictive measures against Iran as announced in Council Decision 2012/635/CFSP. These measures are targeted at Iran's nuclear and ballistic programmes and the revenues made from these programmes by the Iranian government.
In response to the deteriorating human rights situation in Iran, the EU has also adopted Council Regulation (EU) No 359/2011 of 12 April 2011. This regulation has been amended by Council Regulation (EU) No 264/2012, which includes the Annex III list of equipment that might be used for internal repression and related services (e.g., financial, technical, brokering) and internet monitoring and telecommunications equipment and related services.[124]
TheBBC, in answering "Why are there sanctions?" wrote in 2015:
In November 2011 the IAEA reported "serious concerns regarding possible military dimensions to Iran's nuclear programme" and indications that "some activities may still be ongoing."[126]
The United States said the sanctions were not made to topple the Iranian government, but convince it to change several of its policies.[127]
Organizations such asFATF andBaFin have imposed sanctions on Iran not because of its nuclear program, but due to concerns over money laundering and terrorist financing, which undermine the credibility of the Iranian economy.[16][18]
TheEuropean Union'sGeneral Court overturned EU sanctions against two of Iran's biggest banks,Bank Saderat andBank Mellat. The two banks had filed suit with the European court to challenge those sanctions.[citation needed]
U.S. and EU leaders are trying to tighten restrictions on business with Iran, which produced 3.55 million barrels of crude a day in January, 11 percent of OPEC's total, according to data compiled by Bloomberg.[128]
The sanctions bring difficulties to Iran's $483 billion, oil-dominated economy.[89] Data published by theIranian Central Bank show a declining trend in the share of Iranian exports from oil-products (2006–2007: 84.9%, 2007–2008: 86.5%, 2008–2009: 85.5%, 2009–2010: 79.8%, 2010–2011 (first three quarters): 78.9%).[129] The sanctions have had a substantial adverse effect on the Iranian nuclear program by making it harder to acquire specialized materials and equipment needed for the program. The social and economic effects of sanctions have also been severe,[130][131] with even those who doubt their efficacy, such asJohn Bolton, describing theEU sanctions, in particular, as "tough, even brutal."[132] Iranian foreign minister Ali Akhbar Salehi conceded that the sanctions are having an impact.[133] China has become Iran's largest remaining trading partner.[108]
Sanctions have reduced Iran's access to products needed for the oil and energy sectors, have prompted many oil companies to withdraw from Iran, and have also caused a decline in oil production due to reduced access to technologies needed to improve their efficiency.[citation needed]According to Undersecretary of StateWilliam J. Burns, Iran may be annually losing as much as $60 billion in energy investment.[134] Many international companies have also been reluctant to do business with Iran for fear of losing access to larger Western markets. [Naseem, M(2017) International Energy Law].As well as restricting export markets, the sanctions have reduced Iran's oil income by increasing the costs of repatriating revenues in complicated ways that sidestep the sanctions; Iranian analysts estimate the budget deficit for the 2011–2012 fiscal year, which in Iran ends in late March, at between $30bn to $50bn.[135] The effects of U.S. sanctions include expensive basic goods for Iranian citizens, and an aging and increasingly unsafe civil aircraft fleet. According to theArms Control Association, the international arms embargo against Iran is slowly reducing Iran's military capabilities, largely due to its dependence on Russian and Chinese military assistance. The only substitute is to find compensatory measures requiring more time and money, and which are less effective.[136][137] According to at least one analyst (Fareed Zakaria), the market for imports in Iran is dominated by state enterprises and state-friendly enterprises, because the way to get around the sanctions is smuggling, and smuggling requires strong connections with the government. This has weakened Iranian civil society and strengthened the state.[citation needed]
The value of theIranian rial has plunged since autumn 2011, it is reported to have devalued up to 80%, falling 10% immediately after the imposition of the EU oil embargo[138] since early October 2012,[139] causing widespread panic among the Iranian public.[135] In January 2012, the country raised the interest rate on bank deposits by up to 6 percentage points in order to curtail the rial's depreciation. The rate increase was a setback for Ahmadinejad, who had been using below-inflation rates to provide cheap loans to the poor, though naturally Iranian bankers were delighted by the increase.[135] Not long after, and just a few days after Iran's economic minister declared that "there was no economic justification" for devaluing the currency because Iran's foreign exchange reserves were "not only good, but the extra oil revenues are unprecedented,"[135] the country announced its intention to devalue by about 8.5 percent against the U.S. dollar, set a new exchange rate and vowed to reduce the black market's influence (presumably booming because of the lack of confidence in the rial).[140] The Iranian Central Bank desperately tried to keep the value of the rial afloat in the midst of the late 2012 decline by pumping petrodollars into the system to allow the rial to compete against the US dollar.[141] Efforts to control inflation rates were set forth by the government through a three-tiered-multiple-exchange-rate;[142] this effect has failed to prevent the rise in cost of basic goods, simultaneously adding to the public's reliance on the Iranian black-market exchange rate network.[141] Government officials attempted to stifle the black-market by offering rates 2% below the alleged black-market rates, but demand seems to be outweighing their efforts.[143][144]
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Sanctions tightened further when major supertanker companies said they would stop loading Iranian cargo. Prior attempts to reduce Iran's oil income failed because many vessels are often managed by companies outside the United States and the EU; however, EU actions in January extended the ban to ship insurance. This insurance ban will affect 95 percent of the tanker fleet because their insurance falls under rules governed by European law. "It's the insurance that's completed the ban on trading with Iran," commented one veteran shipbroker.[145] This completion of the trading ban left Iran struggling to find a buyer for nearly a quarter of its annual oil exports.[90]
Another effect of the sanctions, in the form of Iran's retaliatory threat to close theStrait of Hormuz, has led to Iraqi plans to open export routes for its crude via Syria, though Iraq's deputy prime minister for energy affairs doubted Iran would ever attempt a closure.[145]
After Iranian banks blacklisted by the EU were disconnected from theSWIFT banking network, then Israeli Finance MinisterYuval Steinitz stated that Iran would now find it more difficult to export oil and import products. According to Steinitz, Iran would be forced to accept only cash or gold, which is impossible when dealing with billions of dollars. Steinitz told theIsraeli cabinet that Iran's economy might collapse as a result.[146][147]
The effects of the sanctions are usually denied in theIranian press.[148][149] Iran has also taken measures to circumvent sanctions, notably by using front countries or companies and by usingbarter trade.[150] At other times the Iranian government has advocated a "resistance economy" in response to sanctions, such as using more oil internally as export markets dry up andimport substitution industrialization of Iran.[151][152] However, based on research, the sanctions resulted in welfare losses across all income groups in Iran, with wealthier groups suffering greater losses compared to poorer groups.[153][154] Additionally, income concentration and share within top income groups declined post-sanctions.[155]
In October 2012, Iran began struggling to halt a decline in oil exports which could plummet further due to international sanctions, and theInternational Energy Agency estimated that Iranian exports fell to a record of 860,000 bpd in September 2012 from 2.2 million bpd at the end of 2011. The results of this fall led to a drop in revenues and clashes on the streets of Tehran when the local currency, therial, collapsed. The output in September 2012 was Iran's lowest since 1988.[156]
Iranian Foreign Ministry spokesman Ramin Mehmanparast has said that the sanctions were not just aimed at Iran's nuclear program and would continue even if the nuclear dispute was resolved.[157]
In 2018, as a response to US visa restrictions for those who have visited Iran after 2011, Iran ceased affixing visas in passports and stamping passports on entry of foreigners from most countries.[158][159][160]
In the face of increased economic pressure from the United States and Europe and a marked decrease of oil exports,[2] Iran has sought to manage the impact of international sanctions and limit capital outflows by seeking to build a "resistance economy,"[161][162] replacing imports with domestic goods and banning luxury imports such as computers and mobile phones.[163] This is predicted to lead to an increase in smuggling, as "people will find a way to smuggle in what the Iranian consumer wants."[164] In 2012, Iran attempted to sell more crude to Chinese and Indian refiners, but China—the single-largest buyer of Iranian crude—has been curtailing its oil imports from Iran down to half their former level.[90]
On 20 October 2018Association of German Banks stated that exports from Germany to Iran dropped 4% to 1.8 billion Euros since January.[165]
Iran has intensified industrial cooperation with theRussian Federation to support its petrochemical industry, despite sanctions. Iran increased the import of Russian natural gas throughAzerbaijan, and is expanding the pipeline toPakistan andOman. In July 2022, Iran andGazprom signed a memorandum of understanding worth US$40bn, supporting the development of theKish Gas Field, and theNorth Pars Gas Field.[166]
In September 2022, after re-negotiations of theJCPOA were stalling, Iran increased its oil exports to China with favorable prices, circumventing economic sanctions.[167] Later that month, the U.S. imposed secondary sanctions on two Chinese entities, and an Indian petrochemical company that traded with Iranian oil.[168]
The comprehensive economic sanctions in place against Iran had a major effect on the consolidation of certain industries. Because longterm sanctions are difficult to remove, they no longer motivate the Iranian leadership to change direction. Furthermore, the sanctions have led to a consolidation of power, as smaller independent companies find it more difficult to evade sanctions. Due to the expansion of government-owned companies in Iran, more money has flowed to government and military coffers.[169]
In 2012, 94Iranian Parliamentarians signed a formal request to have Ahmadinejad appear before the Majles (parliament) to answer questions about the currency crisis. The Supreme Leader terminated the parliament's request in order to unify the government in the face of international pressure.[170] Nonetheless, Ahmadinejad has been called to questioning by parliament on a number of occasions, to justify his position on issues concerning domestic politics. His ideologies seem to have alienated a large portion of the parliament, and stand in contrast to the standpoint of the Supreme Leader.[dubious –discuss][171][172]
A report by Dr. Kenneth Katzman, for theCongressional Research Service, listed the following factors as major examples of economic mismanagement on the part of the Iranian government:
In late September 2022, when violent unrest erupted in major Iranian cities due to thedeath of a 22-year-old Kurdish woman in police custody, Iranians had reported of harsh economic conditions due to sanctions, which in part were blamed for the public discontent.[174] Subsequent to the deadly crack-down by Iranian authorities, America and Europe had announced additional sanctions, while partly lifting limitations on communication technologies with Iran. But according to an analysis by Iranian exiles, Trump's "maximum pressure sanctions" had only exacerbated constraints on civil liberties in Iran, and likely contributed to the election of the "hardliner"Ebrahim Raisi. TheInternational Crisis Group warned that efforts to "deepen Iran's domestic fault lines" were likely to cause the political élite in Iran to "close ranks and bring down the iron fist." Some Western analysts also point out that a weaker Iranian currency makes it harder for struggling citizens to purchase imported goods, disproportionally affecting women and ethnic minorities.[175]
In September 2022, theIMF also concluded in a working paper, "coupled with low economic growth and high unemployment, rising inflation has fueled widespread protests in the country amid a significant erosion in purchasing power." According to an estimate byIran's Ministry of Labour and Social Services, the web of sanctions has pushed one-third of Iranians into poverty. Conservative Iranian analyst Abdolreza Davari confirmed that economic despair is one of the major factors uniting those who are opposed to theEbrahim Raisi-led government. The protests themselves were seen as a possible stumbling block to revive re-negotiations for the JCPOA, as more sanctions were imposed on Iranian officials.[176]
According to the U.S., Iran could reduce the worldprice of crude petroleum by 10%, saving the United States annually $76 billion (at the proximate 2008 world oil price of $100/bbl). Opening Iran's market place toforeign investment could also be a boon to competitive U.S. multinational firms operating in a variety of manufacturing and service sectors.[177]
In September 2018, Iranian oil ministerBijan Zanganeh warned U.S. PresidentDonald Trump to stop interfering in the Middle East if he wants the oil prices to stop increasing. Zanganeh said, "If he (Trump) wants the price of oil not to go up and the market not to get destabilized, he should stop unwarranted and disruptive interference in the Middle East and not be an obstacle to the production and export of Iran's oil."[178]
In October 2021, Iranian oil minister Javad Owji said if U.S.-led sanctions on Iran's oil andgas industry are lifted, Iran will have every capability to tackle the2021 global energy crisis.[179]
With economic sanctions in place against Iran, energy analysts expect a tight petroleum market well into 2023. In contrast to the United States, European countries would like to see a return ofIran (andVenezuela) to the global oil market to ease inflationary pressures worldwide.[180]
Iran relies on regional economies for conducting private as well as state-sponsored business. In 2018, after the U.S. re-imposed secondary sanctions, the trade relations with neighboring countries, such asAfghanistan andIraq, which had increased significantly prior to 2016, took a significant hit.[181] In November 2019, when financial sanctions were further tightened by theTrump administration and theRial devaluation continued, a subsequent increase in energy prices caused widespread protests and violent confrontations in Tehran and other major cities. The economies of border regions with urban areas, such asZahedan, felt the most drastic impact as traders had to pay more for imports, e.g. electronic appliances, while at the same time, the export value for manufactured goods, such as Persian rugs, decreased.[182] Iraq's economy was also seriously affected by the continued financial sanctions since Iran is a major exporter ofwheat to Iraq, andfood prices increased in Iraq after 2016.[183]
In early May 2020, with the parliamentary election of a new Iraqi prime minister, the U.S. extended Iraq's sanction waiver for the import of refined Iranian fuels and electricity from 30 days to 4 months in order to increase the political and economic stability in the region.[184]
According to theUnited Nations Special Rapporteur Idriss Jazairy, the reimposition of economic sanctions after the unilateral US withdrawal in 2018 "is destroying the economy and currency of Iran, driving millions of people into poverty and making imported goods unaffordable." He appealed to the United States and the European Union to ensure that Iranian financial institutions are able to perform payments for essential goods, including foods, medicines and industrial imports. TheOffice of the United Nations High Commissioner for Human Rights stressed that "sanctions must not harm the human rights of ordinary citizens."[185]
Pharmaceuticals and medical equipment do not fall under international sanctions, but Iran is facing shortages of drugs for the treatment of 30 illnesses—includingcancer, heart and breathing problems,thalassemia andmultiple sclerosis (MS)—because it is not allowed to use international payment systems.[186] A teenage boy died fromhaemophilia because of a shortage of medicine caused by the sanctions.[187] Deliveries of some agricultural products to Iran have also been affected for the same reasons.[188]
Drug imports to Iran from the U.S. and Europe decreased by approximately 30 percent in 2012, according to a report by theWoodrow Wilson International Center for Scholars.[189] In 2013,The Guardian reported that some 85,000 cancer patients required forms of chemotherapy and radiotherapy that had become scarce. Western governments had built waivers into the sanctions regime to ensure that essential medicines could get through, but those waivers conflicted with blanket restrictions on banking, as well as bans on "dual-use" chemicals that might have a military as well as a medical application. An estimated 40,000 haemophiliacs could not get blood-clotting medicines, and operations on haemophiliacs were virtually suspended because of the risks created by the shortages. An estimated 23,000 Iranians withHIV/AIDS had severely restricted access to the drugs they need. The society representing the 8,000 Iranians suffering from thalassemia, an inherited blood disorder, said its members were beginning to die because of a lack of an essential drug,deferoxamine, used to control the iron content in the blood. Further, Iran could no longer buy medical equipment such asautoclaves, essential for the production of many drugs, because some of the biggest Western pharmaceutical companies refused to do business with the country.[190]
Journalists reported on the development of ablack market for medicine.[191] Though vital drugs were not affected directly by the sanctions, the amount of hard currency available to the ministry of health was severely limited.Marzieh Vahid-Dastjerdi, Iran's first female government minister since theIranian Revolution, was dismissed in December 2012 for speaking out against the lack of support from the government in times of economic hardship.[192] Furthermore, Iranian patients were at risk of amplified side effects and reduced effectiveness because Iran was forced to import medicines, and chemical building blocks for other medicines, from India and China, as opposed to obtaining higher-quality products from Western manufacturers. Because of patent protections, substitutions for advanced medicines were often unattainable, particularly when it came to diseases such as cancer and multiple sclerosis.[193]
China, the UK, theGroup of 77 and experts are pressing the US to ease sanctions on Iran to help it fight the growing coronavirus outbreak.[194] "There is no doubt that Iran's capacity to respond to the novel coronavirus has been hampered by the Trump administration's economic sanctions, and the death toll is likely much higher than it would have been as a result," Center for Economic and Policy Research (CEPR) Co-director Mark Weisbrot said. "There can also be no question that the sanctions have affected Iran's ability to contain the outbreak, leading in turn to more infections, and possibly to the virus's spread beyond Iran's borders."[195]
On 6 April 2020,Human Rights Watch released a report urging the United States to ease sanctions on Iran "to ensure Iran access to essential humanitarian resources during the [coronavirus]pandemic."[196] The impact of sanctions on Iran made the COVID-19 management a difficult issue in Iran. While enduring crippling sanctions, the healthcare system fought COVID-19 with a low budget and inadequately equipped facilities.[197][198]
In October 2020, Bloomberg reported that US sanctions had halted aflu vaccine shipment of 2 million doses. Iran'sRed Crescent Society indicated how the drastic financial sanctions rendered the community Shahr Bank insolvent, which halted the crucial shipment.[199]
The "Civil Movement" was initiated by two prominent Iranian economists—Dr. Mousa Ghaninejad, of Tehran's Petroleum University of Technology, andDr. Mohammad Mehdi Behkish, of Tehran's Allameh Tabatabaei University—on 14 July 2013. They described the sanctions as an "unfair" and "illogical" tool, arguing that a freer economy would lead to less political enmity and encourage amicable relationships between countries. They also noted that sanctions against one country punish not only the people of that country, but also the people of its trade partners.[200]
The movement was supported by a large group of intellectuals, academics, civil society activists, human rights activists and artists.[200][201][202] In September 2013, theInternational Chamber of Commerce-Iran posted an open letter by 157 Iranian economists, lawyers and journalists criticizing the humanitarian consequences of sanctions and calling on their colleagues across the world to pressure their governments to take steps to resolve the underlying conflict.[203]
In April 2021, more than 40 grassroots organisations have called onUS President Joe Biden's administration to lift restrictions that "have obstructed the flow of critical vaccines, medicine and humanitarian goods into Iran". Iran had struggled to acquire Western vaccines due to sanctions, and was one of the worst hit countries by theCOVID-19 pandemic.[204]
After theIranian Revolution in 1979, the United States ended itseconomic and diplomatic ties with Iran, banned Iranian oil imports and froze approximately 11 billion 1980-US dollars of its assets.[205]
In the years of 2008 to 2013, billions of dollars of Iranian assets abroad were seized or frozen, includinga building in New York City,[206] and bank accounts in Great Britain,Luxembourg,[207] Japan[208] and Canada.[209]
In 2012, Iran reported that the assets ofGuard-linked companies in several countries were frozen but in some cases the assets were returned.[210]
The chairman of the Majlis Planning and Budget Committee says $100 billion of Iran's money was frozen in foreign banks because of the sanctions imposed on the country.[211] In 2013, only $30 billion to $50 billion of itsforeign exchange reserves (i.e. roughly 50% of total) was accessible because of sanctions.[212]
In October 2025,Reuters exposed the involvement of the Maritime Mutual Insurance Association (MMIA), also known as the New Zealand P&I Club, aNew Zealand-based insurance company owned by UK citizen Paul Rankin, along with two affiliates inDubai, MME Services and Maritime Reinsurance, in the violation of sanctions against Iran.[213] According to the report, the company facilitated the trade of billions of dollars worth of Iranian and Russian oil by providing insurance tovessels that evade Western sanctions, without which they would not be able to enter any ports, including those in Russia and Iran.[213] Among the vessels insured by the company are one sixth of the tankers in the "shadow fleet", a network that conceals its activities through falsified tracking data and documents.[213]
According to David Tannenbaum, director of sanctions consultancy Blackstone Compliance Services and a formerUS Treasury sanctions specialist, the number of shadow fleet vessels insured by Maritime Mutual, far exceeds that of other major actors in sanctions evasion.[213] Of 231 tankers identified by Reuters to have been insured by Maritime Mutual, 130 were exposed as having carried sanctioned cargo. According toCentre for Research on Energy and Clean Air (CREA) calculations based on commercial databases of individual oil trades and historic prices, vessels insured by Maritime Mutual carried $18.2 billion ofIranian oil and energy products and $16.7 billion of Russian energy products, since the sanctions were imposed.[213]
Despite the company's claims of compliance with international laws, New Zealand authorities are also investigating Maritime Mutual for additional potential violations related to money laundering and terrorism financing. During a police search of theAuckland andChristchurch premises various documents and records were confiscated.[213] According toGlobal Fishing Watch, between 2018 and 2025 there were 274 cases in which ships insured by Maritime Mutual disabled theirautomatic identification system (AIS) or altered it to transmit false tracking data, a practice known asspoofing, commonly used by crews to hide their movements.[213]
When theJoint Comprehensive Plan of Action between Iran and theP5+1 was implemented in early 2016, sanctions relief affected theeconomy of Iran in four principal ways:[214]
According to theCentral Bank of Iran, Iran would use funds unfrozen by its nuclear deal mainly to finance domestic investments, keeping the moneyabroad until it was needed.[216]
According to theWashington Institute in 2015: "The pre-deal asset freeze did not have as great an impact on the Iranian government as some statements from Washington suggested. And going forward, the post-deal relaxation of restrictions will not have as great an impact as some critics of the deal suggest."[217]
On 16 January 2016, theInternational Atomic Energy Agency said that Iran had adequately restricted its nuclear program, resulting in theUnited Nations lifting some of the sanctions.[218][219][220]
In February 2019, France, Germany and the United Kingdom announced that they have created apayment channel namedINSTEX to bypass the newly reimposed sanctions by the United States, following the unilateral withdrawal from theJCPOA by theTrump administration.[221] The Trump administration warned that countries engaging in financial transactions with Iran could face secondary U.S. sanctions.[222]
In late January 2020, the Swiss Humanitarian Trade Arrangement (SHTA) with Iran was implemented, assuring export guarantees through Swiss financial institutions for shipments of food and medical products to the Islamic republic. Geneva-based bankBCP and a large Swiss drugmaker were participating in the initial pilot shipment ofessential medicines worth 2.3 million euros ($2.55 million).[223]
According to one independent study in 2022, Iran could see a windfall of one trillion US dollars over 10 years if a new agreement is signed with the P5+1.[224]
Iran's top oil buyers in Europe were making substantial cuts in supply months in advance of European Union sanctions, reducing flows to the continent . . . by more than a third—or over 300,000 barrels daily. . . . Iran was supplying more than 700,000 barrels per day to the EU plus Turkey in 2011, industry sources said.
{{cite web}}: CS1 maint: location (link)Ratcheted-up sanctions, including an imminent oil embargo and the obstruction of Iran's ability to finance its trade, are having a big impact on the Iranian economy.
[S]unny propaganda about the impact of economic sanctions on Iran is emanating from the Obama administration . . . However, there are only two possible outcomes: Either Iran gets nuclear weapons or it doesn't. To ensure that it doesn't, the only viable option is to break Iran's weapons program militarily.
{{cite web}}: CS1 maint: archived copy as title (link){{cite web}}: CS1 maint: archived copy as title (link)
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