“Will US sanctions targeting energy imports strengthen or weaken domestic opposition?”

“Will US sanctions targeting energy imports strengthen or weaken domestic opposition?”
July 22-August 4, 2009
     In a prepared testimony to the US Congress, Patrick Clawson states that Iran can no longer rely on oil income to cushion its economy from sanctions, arguing that additional economic pressure will lead Iranian citizens to blame their leaders for isolating Iran and not achieving the country’s full growth potential. Clawson states that even if oil prices remain at 2008 levels (approx. $94), Iran would run a trade deficit by 2011/12, and if prices fall by 25% or more, Iran could use up its foreign exchange reserves within 3 years to make up for lost export earnings. Lower oil prices will cause trouble financing much-needed energy imports and the government budget, and President Ahmadinejad is likely to continue his uneconomic populist handouts and exhaust reserves, leading to a “hard landing” for Iran’s economy that will restrict imports. Clawson believes this will heighten domestic resentment toward the government for its anti-US policies and reduce popular support for the nuclear program (Washington Institute for Near East Policy).
     Amid reports that the US is consulting allies in Europe and Israel on possible sanctions targeting Iran’s refined oil imports if efforts toward engagement fail (1, 2), Jamsheed K. Choksy argues that such sanctions will only hurt Iran’s citizens and not its leaders. Broad sanctions could weaken Iran’s opposition movement by leading Tehran to further divert limited resources toward its nuclear program and support for Hamas and Hezbollah. Choksy suggests lifting some sanctions to enable Iranians to communicate and travel more easily while targeting specific leaders—including Supreme Leader Khamenei and President Ahmadinejad among others—for asset freezes and international arrest warrants for human rights violations (Foreign Policy). However, the White House has acknowledged Ahmadinejad as Iran’s “elected leader”, indicating that such targeted sanctions remain unlikely.
Washington Institute for Near East Policy | Foreign Policy


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