The “Oil Weapon” Reversed? Sanctions Against Iran and U.S.‐EU Structural Power

In theory, unilateral, selective oil embargoes do not work, whether imposed by consumer or producer countries. The reason is that oil is fungible commodity that is traded on a world market and, therefore, selective embargoes can always be circumvented by rerouting some oil exports through third-party states. The recent US-EU unilateral oil sanctions against Iran, however, seem to form an exception to this general rule. In the first months after entering into force, these sanctions have been remarkably successful in curbing Iranian oil exports. This article argues that their strong effect on Iranian crude exports does not result from the implementation of the oil boycotts in itself, but rather stems from the flanking financial, banking, and insurance sanctions. The relative success of the current set of oil sanctions hence derives from the structural power positions of the US and the EU. However, if pushed for too hard, this western strategy may backfire and hollow out the their structural power positions in these respective areas.