After the recent attack on Israel by Iran, analysts are saying that the US faces challenges in tightening sanctions on Iranian oil due to concerns about rising oil prices and strained relations with China. The attack prompted Republican leaders in the US House of Representatives to criticize President Joe Biden for not enforcing current sanctions more strictly. Congressman Steve Scalise mentioned that the Biden administration’s leniency has made it easier for Tehran to sell oil, potentially funding terrorist activities.
In response to the attack, US lawmakers are expected to propose bills this week to increase sanctions on Iran, the third-largest oil producer in OPEC. Former President Donald Trump had reimposed sanctions on Iranian oil in 2018 after withdrawing from the JCPOA nuclear agreement in 2015. The Biden administration has been trying to restore the agreement, but has faced challenges in doing so. One of their strategies to prevent Iran from selling oil abroad involves punishing businesses in China, the UAE, and other countries.
Washington recently renewed a sanctions regime that allows Iraq to buy energy from Iran, providing Tehran with an additional $10 billion in revenue. The pressure to punish Iran following the attack on Israel is placing the Biden administration in a difficult position as they try to prevent further attacks, stabilize oil prices, and navigate their relationship with China, Iran’s largest oil buyer.
Tensions between Hamas and Israeli forces in the Gaza Strip also contribute to Washington’s efforts to prevent conflict from spreading in the region. However, doubts remain about Biden’s ability to tighten sanctions on Iranian oil exports, which are crucial to the country’s economy. Concerns about the impact on oil prices, as well as potential repercussions on US-China relations, are factors influencing decision-making in the Biden administration. Despite affirming that sanctions remain in place, the administration faces challenges in taking strong action against Iran.
The importance of sanctions in influencing Iran’s oil exports presents a complex dilemma for the US government. While there is a desire to hold Iran accountable and prevent further attacks, the implications on oil prices and relations with China pose significant obstacles. Striking a balance between addressing security concerns and economic stability remains a key challenge for the Biden administration in the aftermath of the attack on Israel by Iran.