It’s hard to understand what, exactly, the Obama administration is trying to accomplish by slapping yet another layer of sanctions  on Iran. From a policy point of view, it makes no sense whatsoever. The only possible conclusion is that it’s political, designed to fend off attacks from hawks and Republican candidates  that Obama is feckless on Iran. Like previous rounds of Iran sanctions, which almost no one in Washington thinks will work as intended—namely, to force Iran to halt its enrichment of uranium—this new round seems calculated to buy more time for the Obama administration.
Those who argue that the administration is boxing in Iran while preparing the ground for war against Tehran—just as the Bush administration did with Iraq—are wrong. They draw that conclusion on ideological grounds. Fact is, there’s zero evidence to suggest that the Obama administration wants war with Iran. Not only that, but it’s virtually certain that that the White House and the Pentagon have let the Israelis know in no uncertain terms that the United States will not accept a freelance attack on Iran by Israel, either.
By placing new sanctions on Iran, once again, the administration believes that it can buy time to argue that it’s being tough with Ayatollah Khamenei and President Ahmadinejad. But they do so at a cost, since ever-tighter sanctions have a counterproductive effect. More sanctions galvanize the Iranian hawks and ultra-conservatives, undermine the diplomats, weaken the domestic Green Movement and other opposition forces, and strengthen the power of the Islamic Revolutionary Guard Corps, which operates a vast and profitable network of anti-sanctions smuggling routes.
The new sanctions are specifically designed to target Iran’s oil and petrochemical industry. In a background briefing yesterday, administration officials explained:
“The steps today were especially important and impactful in the area of energy. We expand significantly our energy-related sanctions. The President issued today a new Executive Order. Its number is 13590, 135-90, and it allows us to impose sanctions on companies that provide goods and services to upstream Iranian oil and gas activities like development, exploration, extraction of oil and gas.… They’re desperately in need of capital and technology because their oil production is declining. And what this measure will do is to impede their efforts to reverse this decline. And this is critical because oil production is critical to the Iranian economy. It’s the main source of revenue for Iran. So this is a very important step.
“A second step was also covered by this Executive Order 13590 and that is it allows us to impose sanctions on companies that provide goods, services, and technology to Iran’s petrochemical industry. This is the first time we have targeted Iran’s petrochemical industry. It’s a very important sector of the Iranian economy. After crude oil, it’s the biggest export earner for Iran. Indeed, about 50 percent of Iran’s non crude oil exports come from the sale of petrochemicals….
“We are beginning today to launch a worldwide diplomatic campaign to encourage governments and companies that purchase petrochemicals from Iran to switch to alternative sources of supply. Now, this is not like crude oil, where there are difficulties in companies simply agreeing to forego imports of Iranian crude oil. There are lots of good producers of petrochemical products, and they can switch easily. And if they did, this would dramatically reduce Iran’s export earnings. So we think this is a very significant step.”
Of course, the countries that depend on imports of oil from Iran, in a scarce and expensive market (oil prices have recently zoomed past $100 per barrel again) aren’t going to suspend major trade with Iran, especially China, which can be counted on to maintain or increase its economic relations with Iran. And the administration backed off from targeting Iran’s Central Bank . Had they done so, it would mean that if China or Japan, say, continued to buy oil from Iran and settle accounts with Iran’s Central Bank, the United States would have to impose sanctions against those countries, too. That would have been explosively counterproductive and dangerous.
“Russia sees such extraterritorial measures as unacceptable and against international law. Such a practice seriously obstructs advancement toward a constructive dialogue with Tehran. Stronger sanction pressure, which some of our partners see almost as a goal in itself, will not encourage Iran to sit down at the negotiating table.”
Of course, for the United States, another side benefit of the anti-Iran posturing is that it allows the US military and arms makers to double and re-double their efforts to expand the American military presence and sell weapons to the repressive kleptocracies of the gulf. Never mind that Saudi Arabia and Qatar financing reactionary Muslim Brotherhood groups against the Arab Spring, or that Bahrain is squashing pro-democracy Shiites. As the United States departs from battered Iraq, it wants to build up forces in Kuwait and other countries in the gulf and foster an anti-Iran coalition there, made up of frightened royal families who fear that the Arab Spring might topple them next. (Already, there are protests in Kuwait .)