EXECUTIVE SUMMARY: Iranian leaders have said the future of the nuclear agreement (the JCPOA) in the wake of the US withdrawal will depend on the ability of Europe, China, and Russia to ensure that the impact of US sanctions is substantially blunted. While Europe’s resolve to do so is questionable, Russia, China, the UAE, and Oman appear willing to step in.
Recent Iranian trade figures suggest that the United Arab Emirates (UAE), a strong backer of US efforts to squeeze Iran economically, could emerge alongside China as the Islamic Republic’s foremost lifeline in seeking to blunt the impact of harsh sanctions. Russia and Oman are emerging as runners-up in possible efforts to enable Iran to circumvent sanctions.
Casting further doubt on Europe’s ability and will to stand up to US secondary sanctions, despite its vocal support for the embattled 2015 international agreement that curbed Iran’s nuclear program, are new German financial rules scheduled to take effect this month. The rules could delay or prevent crisis-ridden Iran from repatriating 300 million euros ($347 million) deposited in an Iranian-controlled bank in Hamburg.