Detrimental but not Paralyzing
The new bill of sanctions introduced to the U.S. House of Representatives could not paralyze Iran’s economy.
According to the bill introduced to U.S. House of Representatives, foreign firms that sell refined petroleum products to Iran would be barred from trade inside the United States. Punishment also applies to companies which provide goods or services which allow Iran to maintain or expand its domestic production of oil. The bill is considered as another measure for increasing pressures on Iran to prevent it from U.S.-alleged development of nuclear weapons.
Mehran Amir Moeini, global economy expert believes that the new sanction will not be paralyzing, though not devoid of social and economic damage. He adds:
Gasoline produced inside the country can not respond to domestic demands and Iran is forced to import. Imposing new sanctions on petroleum-related products would deeply affect the transportation section, especially personal cars.
Gas oil could be another option to undergo sanctions but Iran has a better status in producing gas oil and a likely sanction that targeted gas oil would be offset with thrift.
To counter sanctions, rationing gasoline would be effective; however, blocking gasoline import will undoubtedly affect economic growth and social and economic domains.
Meanwhile, several development projects for refineries are under study but it is not clear when they will be operational and mitigate the effect of sanctions or increasing domestic consumption.
The only options available for Iran would be cutting the gasoline ration of personal cars and developing petroleum refineries inside the country. However, the required technology for the development is also a matter of concern, since the bill will also penalize firms which provide Iran with goods and services to maintain or expand its domestic production.
In general, the sanction may not be paralyzing but they would definitely have deleterious social and economic effects and may add to pressures. Gas oil seemed like a better candidate for sanction since a great number of goods are transported by gas oil consuming vehicles, but apparently Iran would undergo less pressure with gas oil sanction.