After failing to halt Iran’s nuclear advances with harsh economic sanctions, a group of U.S. lawmakers and analysts is proposing a more drastic remedy: cutting off Iran entirely from world oil markets.
Advocates of the measure say increases in oil and gas production in the Middle East and North America have made it economically feasible to organize the first truly global boycott of Iranian crude. Such an effort, if successful, would sideline the world’s fourth-biggest oil producer and could force Iran to change its nuclear policies.
Some economists and Obama administration officials have criticized the proposal, variations of which are circulating on Capitol Hill, saying such a measure could disrupt oil markets, alienate U.S. allies and drive up energy prices.
White House officials say they are exploring alternatives for further reducing the petroleum sales that provide Iran with the bulk of its foreign-currency earnings. At the same time, the administration and Congress are pushing for new financial measures to close loopholes that allow Iran to collect hard currency — particularly gold — for its oil and gas.