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What to Watch in Trump’s Escalating Confrontation With Iran


The following is an excerpt from Ladane Nasseri , Sam Wilkin , and Golnar Motevalli | February 5, 2017 | Bloomberg.com |

An immigration ban, missile launches, new sanctions, hostile rhetoric -- in the space of just over a week relations between the U.S. and Iran have reverted to the diplomatic and military threats of the not-so-distant past. The 2015 nuclear deal that removed most sanctions on the Islamic Republic and cracked open a largely untapped market of 80 million people to investors hasn’t been sunk -- but it’s facing headwinds. Here are four key issues to watch.

Oil exports

The new U.S. sanctions announced last week by the Trump administration don’t target Iran’s oil production or exports, and crude prices closed flat on the day they were implemented. Further measures could hinder Iran’s plans to expand production with the help of foreign investment, but a major escalation -- and direct targeting of the oil industry -- would be needed to have an immediate impact on supply.

Iran’s oil exports have more than doubled since nuclear-related sanctions were lifted in January 2016. In an extreme case, a resumption of the European Union’s embargo on Iranian oil and sanctions on shipping insurers could remove more than 1 million barrels per day from global markets.

For more visit: Bloomberg.com