Trump orders ‘maximum economic pressure’ on Iran, seeks to cut oil exports to zero

U.S. President Donald Trump on Tuesday restored his “maximum pressure” campaign on Iran that includes efforts to drive its oil exports down to zero in order to stop Tehran from obtaining a nuclear weapon.

Ahead of his meeting with Israeli Prime Minister Benjamin Netanyahu, Trump signed the presidential memorandum reimposing Washington’s tough policy on Iran that was practiced throughout his first term.

As he signed the memo, Trump described it as very tough and said he was torn on whether to make the move. He said he was open to a deal with Iran and expressed a willingness to talk to the Iranian leader.

“With me, it’s very simple: Iran cannot have a nuclear weapon,” Trump said. Asked how close Tehran is to a weapon, Trump said: “They’re too close.”

Iran’s mission to the United Nations in New York did not immediately respond to a request for comment.

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Trump has accused former President Joe Biden of failing to rigorously enforce oil-export sanctions, which Trump says emboldened Tehran by allowing it to sell oil to fund a nuclear weapons program and armed militias in the Middle East.

Iran is “dramatically” accelerating enrichment of uranium to up to 60% purity, close to the roughly 90% weapons-grade level, the U.N. nuclear watchdog chief told Reuters in December. Iran has denied wanting to develop a nuclear weapon.

Trump’s memo, among other things, orders the U.S. Treasury secretary to impose “maximum economic pressure” on Iran, including sanctions and enforcement mechanisms on those violating existing sanctions.

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It also directs the Treasury and State Department to implement a campaign aimed at “driving Iran’s oil exports to zero.” U.S. oil prices pared losses on Tuesday on the news that Trump planned to sign the memo, which offset some weakness from the tariff drama between Washington and Beijing.

Tehran’s oil exports brought in $53 billion in 2023 and $54 billion a year earlier, according to U.S. Energy Information Administration estimates. Output during 2024 was running at its highest level since 2018, based on OPEC data.

Trump had driven Iran’s oil exports to near-zero during part of his first term after re-imposing sanctions. They rose under Biden’s tenure as Iran succeeded in evading sanctions.

The Paris-based International Energy Agency believes Saudi Arabia, the United Arab Emirates and other OPEC members have spare capacity to make up for any lost exports from Iran, also an OPEC member.

Push for sanctions snapback

China does not recognize U.S. sanctions and Chinese firms buy the most Iranian oil. China and Iran have also built a trading system that uses mostly Chinese yuan and a network of middlemen, avoiding the dollar and exposure to U.S. regulators.

Kevin Book, an analyst at ClearView Energy, said the Trump administration could enforce the 2024 Stop Harboring Iranian Petroleum (SHIP) law to curtail some Iranian barrels.

SHIP, which the Biden administration did not enforce strictly, allows measures on foreign ports and refineries that process petroleum exported from Iran in violation of sanctions. Book said a move last month by the Shandong Port Group to ban U.S.-sanctioned tankers from calling into its ports in the eastern Chinese province signals the impact SHIP could have.

Trump also directed his U.N. ambassador to work with allies to “complete the snapback of international sanctions and restrictions on Iran,” under a 2015 deal between Iran and key world powers that lifted sanctions on Tehran in return for restrictions on its nuclear program.

The U.S. quit the agreement in 2018, during Trump’s first term, and Iran began moving away from its nuclear-related commitments under the deal. The Trump administration had also tried to trigger a snapback of sanctions under the deal in 2020, but the move was dismissed by the U.N. Security Council.

Britain, France and Germany told the United Nations Security Council in December that they are ready - if necessary - to trigger a snapback of all international sanctions on Iran to prevent the country from acquiring a nuclear weapon.

They will lose the ability to take such action on Oct. 18 when a 2015 U.N. resolution expires. The resolution enshrines Iran’s deal with Britain, Germany, France, the United States, Russia and China that lifted sanctions on Tehran in exchange for restrictions on its nuclear program.

Iran’s U.N. ambassador, Amir Saeid Iravani, has said that invoking the “snap-back” of sanctions on Tehran would be “unlawful and counterproductive.”

European and Iranian diplomats met in November and January to discuss if they could work to defuse regional tensions, including over Tehran’s nuclear program, before Trump returned.