The European Union (EU) recently reinstated sanctions on Iran that had been lifted under the 2015 nuclear agreement, known as the Joint Comprehensive Plan of Action (JCPOA). This decision came following the United Nations Security Council’s (UNSC) reimposition of snapback sanctions. The EU’s measures included freezing Iranian banks’ assets and banning oil imports and technological exports that could aid Iran’s uranium enrichment.
Iran’s key economic entities, like the Khatam ol Anbia Construction Headquarters, which is linked to the Islamic Revolutionary Guards Corps (IRGC), are also facing sanctions. These entities are crucial for Iran’s economy, as they have built infrastructure across the country. In recent reports, Iranian banks held assets worth 1.9 billion euros in Europe, highlighting their significance in the international financial landscape.
The renewed sanctions may deepen Iran’s isolation and further reduce trade between Iran and the EU, which was Iran’s fifth largest trade partner in 2024. However, the exact impact of these sanctions remains uncertain as US sanctions imposed in 2018 had already weakened EU-Iran trade significantly.
Supreme Leader Ali Khamenei framed the snapback sanctions as “psychological warfare,” urging Iranian leaders to strengthen ties with neighboring countries, particularly in the Global South. He advocates for a “Look East” policy to foster partnerships with nations like China and Russia, especially as Iran joined BRICS, a group of major emerging economies, January 2024.
Concerns over economic unrest in Iran are rising. Four Iranian officials disclosed to Reuters that these sanctions could ignite public anger due to rising inflation, which exceeds 40%, and a steep decline in the currency value. There’s fear that discontent could lead to large protests. Khamenei’s steadfast refusal to negotiate with the US only complicates hopes for immediate economic relief.
In Syria, tensions are also escalating. Turkey has reportedly deployed military assets to the Kuweires Airbase, raising alarms about a possible joint operation against the Syrian Democratic Forces (SDF), which control part of eastern Aleppo. Recent movements of Turkish reinforcements suggest preparations for a military action if the SDF does not integrate into the Syrian state.
The Shia Coordination Framework in Iraq is currently discussing its next prime minister ahead of the November 2025 elections, showcasing their political confidence. This coalition, backed by Iran, is pivotal as it navigates internal divisions while vying for influence.
In Lebanon, Iranian officials, including Ali Larijani, are working to maintain Iranian influence amid local efforts to disarm Hezbollah. Larijani’s commitment to support Hezbollah came amid discussions on the reconstruction of Lebanon, which requires far more than what Iran has offered.
The situation continues to evolve rapidly, with implications for regional stability and economics. As Iran, Syria, and Iraq face mounting pressures internally and externally, the outcomes of these political and military maneuvers could significantly shape the Middle East’s future.
For further reading, you can explore the latest in EU-Iran relations and sanctions through reputable sources like Reuters and BBC News.
