Biden administration moving toward tighter enforcement of Iran sanctions

The Biden administration could implement more economic sanctions on Iran and countries it trades with as indirect talks on restarting a nuclear deal hit a snag.

With very little progress being made during ongoing negotiations in Vienna, the U.S. is considering sending a delegation to the United Arab Emirates (UAE), a close trading partner of Iran, to discuss possible economic sanctions, The Wall Street Journal first reported on Thursday, citing officials familiar with the plan.

The UAE is “a very important portion of Iran’s continued commerce flows,” making up billions of dollars in oil trade and other sales, U.S. officials told the publication.

The administration could tighten oversight on the trade flow between the two countries by sanctioning banks and other entities that are not compliant with existing Iranian sanctions. The move could also be followed by sanctions on other trading partners, including China, officials said.

White House press secretary Jen Psaki confirmed later Thursday that officials were taking steps to prepare further sanctions if they are needed, but declined to offer specifics or lay out a specific timeline. 

“We believe a diplomatic resolution offers the best path to avoiding a nuclear crisis. However, given the ongoing advances in Iran’s nuclear program, the president has asked his team to be prepared in the event that diplomacy fails and we must turn to other options and that requires preparations,” Psaki said. 

“We have made clear to Iran that the only path out of sanctions is through nuclear compliance,” she continued. “If diplomacy cannot get on track soon and if Iran’s nuclear program continues to accelerate then we will have no choice but to take additional measures to further restrict Iran’s revenue-producing sectors.”

Psaki said that a senior official from Treasury’s Office of Foreign Assets Control would lead a delegation to the UAE next week to discuss sanctions compliance. 

The news signals that the administration is preparing for a possible fallout in the ongoing negotiations to revive the Joint Comprehensive Plan of Action, a 2015 pact between Iran and the U.S. that limited Iranian production of nuclear weapons in return for the lifting of economic sanctions. That deal was scrapped in 2018 by then-President Trump.

Iran has already re-started enriching uranium, amassing a small stockpile of the material of at least 60 percent purity. Uranium needs to be enriched to 90 percent purity for nuclear weapons development.

The U.S. is still holding out hope a deal will be reached between the two countries. On Wednesday, the U.S. told reporters that Robert Malley, the special envoy for Iran, will head to Vienna this weekend to join the indirect talks.

—Updated at 3:43 p.m.