A History Of U.S. Sanctions Against Iran

The U.S. lifted most of its sanctions against Iran in 2016

U.S. Treasury Secretary Timothy Geithner and Chinese Premier Wen Jiabao before a meeting in Beijing, China, on January 11. 2012. Timothy Geithner visited China and Japan to discuss U.S. sanctions on Iran with government officials. Photo by Andy Wong - Pool / Getty Images

Although the United States imposed sanctions against Iran for decades, none levered the country into compliance with international rules regarding terrorism or nuclear energy. By early 2012, however, evidence appeared to be mounting that sanctions by both the U.S. and its global allies were hurting Iran. The Joint Comprehensive Plan of Action went into effect in 2015, easing tensions and sanctions considerably.

Most of the sanctions cut into Iran's oil exports, which account for 85 percent of the country's export revenue. Iran's repeated threats to close the Strait of Hormuz, a vital oil conduit, to international use indicated at one point that Iran was kicking at global oil usage to relieve pressure on its own oil industry.

The Carter Years

Islamic radicals captured 52 Americans at the U.S. Embassy in Tehran and held them hostage for 444 days beginning in November 1979. U.S. President Jimmy Carter tried unsuccessfully to free them, including authorizing a military rescue attempt. Iranians did not free the hostages until just after Ronald Reagan replaced Carter as president on January 20, 1981.

The United States broke diplomatic relations with Iran in 1980 in the midst of that crisis. The U.S. also levied its first round of sanctions against Iran during this time. Carter banned imports of Iranian oil, froze some $12 billion in Iranian assets in the U.S. and later banned all U.S. trade with and travel to Iran in 1980.

The U.S. lifted the embargoes after Iran released the hostages.

Sanctions Under Reagan

The Reagan Administration declared Iran a state sponsor of terrorism in 1983. As such, the U.S. opposed international loans to Iran.

When Iran began threatening traffic through the Persian Gulf and Strait of Hormuz in 1987, Reagan authorized naval escorts for civilian ships and signed a new embargo against Iranian imports.

The United States also banned the sale of "dual use" items to Iran – civilian goods with the possibility of military adaptation.

The Clinton Years

President Bill Clinton expanded U.S. sanctions against Iran in 1995. Iran was still labeled a state sponsor of terrorism and President Clinton took this action amid widespread fear it was pursuing weapons of mass destruction. He prohibited all American involvement with the Iranian petroleum industry. He banned all American investment in Iran in 1997, as well as what little U.S. trade remained with the country. Clinton also encouraged other countries to do the same.

Sanctions Under George W. Bush

The United States repeatedly froze the assets of people, groups or businesses identified as helping Iran sponsor terrorism under President George W. Bush, as well as those perceived as supporting Iran's efforts to destabilize Iraq. The U.S. also froze the assets of foreign entities believed to be helping Iran in those areas.

The United States also banned so-called "U-turn" financial transfers involving Iran. According to the U.S. Treasury Department, a U-turn transfer involves Iran but "originates and ends with non-Iranian foreign banks."

Obama's Sanctions of Iran

President Barack Obama has been strident with Iranian sanctions.

He banned some imports of Iranian foodstuffs and carpets in 2010, and Congress also allowed him to tighten Iranian sanctions with the Comprehensive Iran Sanctions, Accountability, and Divestment Act (CISADA). Obama could encourage non-U.S. petroleum firms to halt the sale of gasoline to Iran, which has poor refineries. It imports nearly one-third of its gasoline.

The CISADA also prohibited foreign entities from using American banks if they do business with Iran.

The Obama Administration sanctioned Venezuela's nationalized oil company for trading with Iran in May 2011. Venezuela and Iran are close allies. Iranian President Mahmoud Ahmadinejad traveled to Venezuela in early January 2012 to meet with President Hugo Chavez, in part about the sanctions.

In June 2011, the Treasury Department announced new sanctions against Iran's Revolutionary Guard (already named in other sanctions), the Basij Resistance Force, and Iranian law enforcement entities.

Obama ended 2011 by signing a defense funding bill that would allow the U.S. to cease dealing with financial institutions that do business with Iran's central bank. The bill's sanctions took effect between February and June 2012. Obama was given the power to waive aspects of the bill if implementation would hurt the U.S. economy. It was feared that limiting access to Iranian oil would drive up gasoline prices.

The Joint Comprehensive Plan of Action

Six world powers joined together in 2013 to negotiate with Iran, offering relief from some sanctions if Iran would cease its nuclear efforts. Russia, Britain, Germany, France and China joined the U.S. in this effort, which finally resulted in an agreement in 2015. Then came the "prisoner swap" in 2016, with the U.S. exchanging seven imprisoned Iranians in exchange for Iran releasing five Americans it was holding. The U.S. lifted its sanctions against Iran under President Obama in 2016. 

President Donald J. Trump

President Trump announced in April 2017 that his administration intends to review the country's history of sanctions against Iran. Although many feared this would potentially eradicate the terms of the 2015 deal due to Iran's continued support of terrorism, the review was, in fact, provided for and mandatory under the terms of the 2015 pact.

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Jones, Steve. "A History Of U.S. Sanctions Against Iran." ThoughtCo, Jun. 3, 2017, thoughtco.com/a-history-of-u-s-sanctions-against-iran-3310088. Jones, Steve. (2017, June 3). A History Of U.S. Sanctions Against Iran. Retrieved from https://www.thoughtco.com/a-history-of-u-s-sanctions-against-iran-3310088 Jones, Steve. "A History Of U.S. Sanctions Against Iran." ThoughtCo. https://www.thoughtco.com/a-history-of-u-s-sanctions-against-iran-3310088 (accessed November 19, 2017).