In the presidential debate last night, Donald Trump said that US sanctions re-introduced under his presidency would have crippled Iran's ability to fund Hamas and other terror groups, and October 7 would likely not have happened under his presidency:
Israel would have never been invaded in a million years by Hamas. You know why? Because Iran was broke with me. I wouldn’t let anybody do business with them. They ran out of money. They were broke. They had no money for Hamas. They had no money for anything. No money for terror.
Is this true?
It is a complex topic, but under the Biden administration the sanctions against Iran exporting oil have been loosened and strengthened depending on other considerations (like keeping oil prices low, or incentive for Iran to re-join the JCPOA nuclear agreement.)
As of this year, Iran has exported more oil than at any time since before Trump exited the JCPOA. An analysis from FDD in April states,
Since President Joe Biden assumed office, total Iranian oil exports have exceeded $100 billion, which is greater than the annual budget of Greece or Ireland. Had Tehran’s average daily export volume remained the same as it was while Donald Trump’s maximum pressure policy was in effect from May 2019 to January 2021, the regime would have had $40 billion less to spend on ballistic missiles and proxy groups.
It might not be a fair comparison, since nearly all of Iranian oil exports go to China in ways that make existing US sanctions largely useless. Nevertheless, US officials admit that they have been loosening up oil sanctions on Iran, and more could be done to make it more difficult for Iran to export oil.
The Biden administration also made $6 billion in previously frozen assets available to Iran as part of a deal last year to release American hostages. Claiming it can only be used for humanitarian purposes doesn't mean much if it allows Iran to redirect money that would have gone to hospitals to now go to missiles.
But this is only part of the story of Iranian access to cash that was limited before the JCPOA.
Iran has been openly flouting the JCPOA nuclear agreement since at least 2019 when it announced that it would exceed the enrichment limits they were obligated to under the deal. Yet even so, the EU has never re-introduced the nuclear-related sanctions lifted in 2016 for the deal.
These included "financial, banking and insurance measures; trade in the oil, gas and petrochemical sectors; [and] activity in the shipping, shipbuilding and transport sectors. "
In other words, sanctions that should have been re-introduced under the "EU snapback" mechanism of JCPOA have remain lifted, even thought Iran has been certified to be breaking the deal for more years than it supposedly kept to the deal's terms.
The EU External Action page on the JCPOA, updated in December 2022, still describes its efforts to not only keep to the terms of the abrogated agreement but also to act against the US sanctions regime re-introduced when it withdrew from the agreement in 2018:
WHAT HAS THE EU DONE TO PRESERVE THE JCPOA?Preserving the JCPOA is crucial not only in terms of nuclear non-proliferation but also for the security of the region and beyond.Following the US decision to withdraw from the agreement in May 2018 and to re-impose previously lifted sanctions, the EU remained determined to continue pursuing legitimate trade with Iran. The EU updated its Blocking Statute, extended the EIB external lending mandate to make Iran eligible and provided comprehensive support to France, Germany and the UK (as core shareholders) to set up and fully operationalize INSTEX (Instrument in Support of Trade Exchanges), a special purpose vehicle to facilitate legitimate trade between Europe and Iran. Six more European countries joined INSTEX as shareholders. EU welcomed the decision of six European countries to join Instex as shareholders and encourages further broadening of INSTEX shareholders’ basis. A first transaction was successfully concluded on March 2020.The EU has continuously expressed deep regret at the US decision to withdraw from the agreement and re-imposition of sanctions. At the same time, the EU is also committed to maintaining cooperation with the United States, which remains a key partner and ally.Since July 2019 Iran has taken different steps to reduce its nuclear commitments. The EU and its Member States have consistently urged Iran to reverse these steps and to refrain from further measures that undermine the nuclear deal.
INSTEX failed - but not because of Iranian violations of JCPOA. Rather, Iran itself refused to cooperate with the EU initiative to go around the US sanctions. Nevertheless, the attempt shows how the EU has been enabling Iran's nuclear weapons program by sticking with a deal that Iran has itself abandoned years ago. And the EU is stating that its policy is to keep trying diplomacy, and nothing else, even after they know Iran is violating JCPOA.
The EU has introduced other, much weaker sanctions on Iran for its human rights abuses, its support of Russia in the Ukraine war and its attack on Israel in April. But the widespread sanctions in place before the 2016 nuclear deal remain lifted, even at a time when Iran is saying that it is pursuing nuclear weapons.
The Biden administration could have pressured the EU to adhere to its own signed agreement to introduce snapbacks in case of Iran's violations of JCPOA. Yet this could arguably have happened during the Trump administration as well. I cannot find any evidence of either administration pressuring the EU to invoke the snapbacks.
EU trade with Iran was about €5.2 billion in 2022 and it appears to have increased somewhat since then. Iran's total budget is about $600 billion annually, of which perhaps $100 billion is from oil revenue. However, Iran has a large budget deficit so every billion dollars is important.
There is no way to know how much Iran gives to Hamas and Hezbollah, but it is reasonable to say that it prioritizes its own needs before the terror groups, so every bit of economic pressure on Iran is critical to reduce terror worldwide. Both the US and EU could do much more to limit Iranian access to funds to pay for terror groups.
And it isn't only Hamas. The looming war between Israel and Hezbollah is directly tied to Iranian funding of that terror group. It is ironic that the EU justifies its continuing trade with Iran as being "crucial for the security of the region and beyond" when its effect is to promote a probable war.
