Iran faces new sanctions without negotiations on its nuclear program

Iran faces new sanctions without negotiations on its nuclear program

Iran faces a reimposition of United Nations-imposed sanctions if it does not enter into negotiations within the next few weeks over the future of its nuclear program returns and allows international controls of its facilities.

Reinstatement of sanctions

The process of restoring sanctions lifted under a landmark nuclear deal a decade ago could begin at the end of the month if a meeting on Tuesday between Iran and three European countries fails to produce progress.

France, Germany and the United Kingdom have told the United Nations that they would like to reinstate sanctions through the so-called "snapback" procedure if Iran continues to violate its obligations under the deal.

Background to the nuclear agreement

The snapback procedure was built into the nuclear deal between Iran, the US and the Europeans signed in 2015. Under this deal, Iran received sanctions relief in exchange for strict and verifiable restrictions on its nuclear program.

After U.S. President Donald Trump withdrew from the agreement, known as the JCPOA, in 2018, Iran reduced its compliance and accelerated uranium enrichment toward weapons-grade levels.

Violations of obligations

In a letter to the U.N. Security Council last week, the foreign ministers of the three European countries known as E3 said Iran had “almost completely violated its obligations under the JCPOA.”

“We have made it clear that if Iran is unwilling to reach a diplomatic solution by the end of August 2025 or does not take advantage of the possibility of an extension, the E3 are ready to trigger the snapback procedure,” the statement said.

Iran had broken off nuclear negotiations with the US aimed at limiting its enrichment program after the US and Israel bombed Iranian nuclear facilities during a brief war in June.

Importance of Snapback Procedure

The snapback process automatically restores all sanctions lifted by the UN Security Council under the 2015 agreement. These sanctions, introduced between 2006 and 2010, include an arms embargo, restrictions on uranium enrichment and a ban on Iran acquiring technology related to its ballistic missile program. The measures also led to significant pressure on Iran's oil and financial sectors.

The snapback process lasts 30 days and the Europeans are aware that Russia will take over the presidency of the Security Council in October and could potentially hinder this process.

Iran's preparations

In a phone call with his counterparts from Britain, France and Germany, Iranian Foreign Minister Abbas Araghchi warned that triggering the snapback mechanism would have serious consequences, according to state broadcaster Press TV.

An Iranian official told CNN that Iran is preparing for "worst-case scenarios" and expects the E3 to use their only remaining avenue of influence to satisfy President Trump.

Options Iran is considering include broader restrictions on cooperation with the International Atomic Energy Agency (IAEA), withdrawal from the Nuclear Non-Proliferation Treaty (NPT), and designating the E3 as “enemy states,” which would allow Iranian forces to control ships from those countries in the Persian Gulf and Oman.

Economic impact of sanctions

Analysts believe restoring sanctions put in place by the snapback would significantly damage Iran's already struggling economy.

"In the short term, the snapback will damage the Iranian economy, particularly by creating problems with euro liquidity, which is important for Iran's ability to reliably purchase essential goods such as medicines. The sanctions will also affect consumer and business confidence in Iran," explains analyst Esfandyar Batmanghelidj.

However, he expects China to continue buying Iranian oil. The United Arab Emirates will facilitate trade for Iranian importers, while Iraq will continue to act as a market for Iranian exporters.