U.S.-Iran confrontation puts the EU in a quandary

Infographic showing natural gas installations in Israel, Egypt and Cyprus that are within the ranges of Iranian missiles based in Lebanon and Syria
Iran’s missile arsenals in Lebanon and Syria cast a shadow on the new, EU-supported energy infrastructure in the Mediterranean (source: macpixxel for GIS)
  • Unlike the U.S. and Israel, the EU still believes the JCPOA inhibits Iran’s nuclear weapons program
  • Europe hoped for more business with Iran after sanctions were lifted in 2015
  • Iran’s goal to ramp up hydrocarbons production and exports cannot be salvaged by Russia, China and a friendly Europe
  • Tehran’s hostility toward Israel, its missile program and poor human rights record make it an easy target for U.S. sanctions

The unilateral decision by the United States in May 2018 to withdraw from the multilateral nuclear agreement with Iran and to reimpose economic sanctions on that country has strained transatlantic relations. President Donald Trump has warned international companies to refrain from circumventing or undermining the sanctions if they value their American business. The administration has agreed to allow eight countries – including China, India, South Korea, Japan, Iraq and Turkey – to import limited quantities of Iranian oil.

Finding itself allied with Russia, China and other countries that favored maintaining the Joint Comprehensive Plan of Action (JCPOA), the European Union has encouraged companies to look for ways to keep their links with Iran. However, the capacity of the Union and its member states to support their corporate ventures in Iran and shield them from American retribution is limited.

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