Iran Sanctions Relief May Be Hard to Undo

Sanctions relief given to Iran in return for its agreement to suspend part of its nuclear program are not as limited or as reversible as the White House claims, analysts and some lawmakers say.

“They low-balled the value of sanctions relief,” says Mark Dubowitz, executive director of the Foundation for Defense of Democracies.

Easing restrictions on Iranian oil sales will “change the market psychology from fear to greed and open up a loophole in the international sanctions regime so big you could drive an oil tanker through,” Dubowitz said.

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The United Kingdom, France and Germany may agree but Sweden, Italy and Malta may not, Dubowitz said.

Iran, which has the world's fourth-largest oil reserves, a large auto sector and a population of 80 million people that is 44% under age 25, is an attractive market.

“It's been incredibly difficult to get all members of the E.U. to get on board to implement the sanctions in the first place,” he said. “If six months from now there's not a real deal and they want to reinstitute the sanctions, but the Swedes balk, the sanctions will never get reactivated.”

Dubowitz says the Obama administration's estimate of the value of sanctions relief fails to count the value of increased confidence in the Iranian economy. And by lifting the auto sector sanctions, the deal rescued the country's second-largest employer, Dubowitz said.

“They gave tens of billions of dollars to Iran in a way that will be excruciatingly difficult to reverse if Iran doesn't comply with the deal or sign a final agreement,” Dubowitz said.

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