The Wall Street Journal | Ian Talley: The Trump administration’s decision last week to pull out of the nuclear deal with Iran will create an economic policy challenge for the U.S.: How does it enforce sanctions that the rest of the world no longer backs?
The White House last week announced a plan to reimpose economywide sanctions on Iran in two stages over six months, banning any financial or business dealings with blacklisted entities. Any non-Iranian bank, firm or person who violates that ban risks penalties themselves, including the possibility of losing access to U.S. markets and the ability to use the U.S. dollar in trade and finance.
Few U.S. firms had re-entered the Iranian market after the 2015 nuclear accord gave Tehran sanctions relief across most of the economy in exchange for halting its nuclear development. But the rest of the world ramped up buying Iranian crude and restarted trade relations, pulling the Middle Eastern economy out of recession.
The world largely supported the sanctions regime used during the Obama administration, including America’s Western allies and China, a major purchaser of crude from oil-rich Iran. Still, it took years of high-level jawboning, shuttle diplomacy and punitive action to cut Iran off from world markets and the global financial system.