Impact of Economic Sanctions on Iranian Businesses in 2025
The Office of Foreign Assets Control (OFAC) is responsible for administering and enforcing economic and trade sanctions based on US foreign policy and national security goals, providing information on sanctions programs, including those related to Iran.
For a deeper understanding of these sanctions, the Iran Sanctions Resource Center from the US Department of the Treasury offers comprehensive information on sanctions programs related to Iran. Similarly, Iran Watch, a project dedicated to monitoring Iran's nuclear and missile programs, as well as associated economic sanctions, is another valuable resource.
The International Atomic Energy Agency (IAEA) also plays a crucial role in this context, monitoring Iran's nuclear activities and compliance with international agreements, providing insights into Iran's nuclear program.
The European Union also imposes sanctions on Iran, which are published on the official website of the European External Action Service (EEAS).
The current international sanctions on Iran are primarily focused on restricting its nuclear and missile programs, oil and energy sectors, and financial transactions. These sanctions include:
- The United States embargo, which dates back to 1995 and has been expanded over time, prohibits most U.S. firms from trading with or investing in Iran, targeting Iranian oil exports and financial activities.
- The UN Security Council sanctions, which were previously lifted under the 2015 Iran nuclear deal (JCPOA), are set to be reimposed through a "snapback" mechanism if a new nuclear deal is not reached by the end of August 2025. This mechanism would reinstate all international sanctions that had been suspended, particularly targeting nuclear and missile procurement programs.
- Recent U.S. actions in 2025 have included sanctioning over 75 individuals and entities involved in Iranian oil trading or linked to Iran-related sanctions evasion efforts, increasing pressure on Iran’s economy.
The impact on businesses has been severe. The Iranian economy has contracted significantly—by an estimated 15 to 20 percent since 2012, losing about $160 billion in oil revenue due to sanctions. Inflation rates and unemployment remain high, with inflation reaching around 40 percent during peak sanction periods and unemployment possibly at 20 percent.
Sanctions limit Iran's ability to export oil, access foreign investment, and conduct international banking, which in turn affects global companies by restricting access to Iran’s market and complicating compliance for firms worldwide. The threat or reimposition of sanctions creates substantial uncertainty in international business, discouraging investment and long-term contracts involving Iranian entities.
In summary, these sanctions aim to pressure Iran to halt its nuclear weapons ambitions, while they significantly constrain Iran’s economy, particularly its oil industry, and impose substantial risks and limitations on international businesses engaging with Iran.
Businesses seeking to operate in Iran must prioritize compliance, conduct thorough due diligence, and seek expert legal advice to minimize risks associated with entering this complex market and operating in it. It is essential to note that the US sanctioned Iran over its nuclear proliferation activities, alleged support for terrorism, human rights abuses, and regional destabilization efforts, starting as early as the 1979 Islamic Revolution and hostage crisis.
Lastly, the United Nations Security Council Sanctions Committees provide information on sanctions imposed by the United Nations Security Council, including those related to Iran. This information serves as a vital resource for businesses and individuals navigating the intricate landscape of international sanctions.
- General-news articles might cover the ongoing political tension between Iran and the international community, with a focus on the sanctions imposed on Iran's oil and energy sectors, financial transactions, and nuclear and missile programs.
- Sports organizations may face challenges in their relationship with Iran, as sanctions limit Iran's ability to access foreign investment and conduct international banking, thereby complicating sponsorships and partnerships with Iranian sporting entities.
