Why the "Maximum Pressure" Campaign on Iran Won't Work

By John Hughes

Earlier this week, the Trump administration re-imposed the last of the previously lifted or waived sanctions against Iran as part of its “maximum pressure” campaign against the country. The administration hopes these snapped-back sanctions will force foreign companies to avoid Iran for fear of losing access to the U.S. dollar and American market, thereby creating economic pressure on Iran to change its behavior.

At first glance, this strategy appears to be working. Major foreign companies, including French-based Total and German-based Siemens, announced their withdrawal from Iran soon after the U.S. withdrew from the nuclear deal in May.  And, while re-imposing the sanctions on Iran’s energy and financial sectors this week, the Trump administration announced that its efforts had already reduced Iran’s exports by over 1 million barrels a day.

However, there are three reasons Trump’s strategy won’t succeed in bringing Iran back to the table:

First, the “maximum pressure” campaign just puts the old sanctions back into place. In the years leading up to the Joint Comprehensive Plan of Action (JCPOA), sanctions were increased over time to ratchet up pressure, eventually encompassing most of Iran’s foreign trade.  The U.S. and its allies had also succeeded in getting major foreign companies out of Iran, and in reducing Iranian oil exports to similar levels. Now, there is little headroom to add even more meaningful economic pressure that would presumably be needed as leverage for a wider deal. And like before, Iran will employ middlemen and cutouts to circumvent the sanctions enough for an economic lifeline.

 Second, the U.S. is trying to undertake this effort alone. Previously, the U.S. had the support of the entire international community – including having the nuclear deal endorsed by the UN. This support was not just symbolic. It led to a multilateral sanctions regime against Iran that included a range of UN sanctions and, crucially, an embargo by the EU prohibiting its own companies from doing business in Iran. The international legitimacy helped with previous efforts to shut down Iranian circumvention attempts, with the U.S. able to rely on foreign governments to crack down on middlemen or illicit activities in their territory when alerted to it.  Such goodwill is unlikely this time around.

Finally, the U.S. is demanding wholesale changes to Iran’s domestic and foreign policy, with no clear strategy beyond sanctions on how to achieve these. In addition to curbs on its nuclear program, the Trump administration has said it wants limits on Iran’s proliferation of ballistic missiles and major changes to Iran’s policies in the region. These are legitimate concerns. However, simply employing economic pressure will not be enough to get Iran back to the table. Sanctions alone rarely work, and are most successful as part of a broader strategy that includes diplomatic, military, and public diplomacy efforts.

Unless the U.S. clearly articulates a more comprehensive strategy, and finds ways to bring other countries on board as partners, don’t expect Iran to agree to negotiate.  

So far, thankfully, Iran has said it remains committed to the JCPOA, even with the new sanctions in place. If this changes there is nothing stopping Iran from restarting its nuclear program, which could make for a very volatile situation.