The FINANCIAL - First Wave Of Tough U.S. Sanctions On Iran Goes Into Effect

First Wave Of Tough U.S. Sanctions On Iran Goes Into Effect

First Wave Of Tough U.S. Sanctions On Iran Goes Into Effect

The FINANCIAL -- A first wave of tough sanctions the United States is reimposing on Iran has gone into effect as Washington and Tehran continued to exchange warnings over the far-reaching measures.

The measures taking effect at midnight EDT on August 7 are aimed at cutting off Iran's access to U.S. dollars and stifling trade in key Iranian industries, including cars, aircraft, and Persian carpets.

Washington claimed that Iranians are already seeing economic woes brought on by the sanctions, with Iran's rial currency losing around half its value since Trump announced he would withdraw the United States from Iran's 2015 nuclear accord with world powers in April.

Blasting the agreement as a "horrible, one-sided deal [that] failed to achieve the fundamental objective of blocking all paths to an Iranian nuclear bomb," Trump offered once again to negotiate what he considers a better deal in direct talks with Tehran's leaders, according to RFE/RL.

"I remain open to reaching a more comprehensive deal that addresses the full range of the regime's malign activities, including its ballistic missile program and its support for terrorism," Trump said.

But his offer was quickly rejected by Iranian President Hassan Rohani, who said on state television that it "doesn't make sense."

"If you're an enemy and you stab the other person with a knife and then you say you want negotiations, then the first thing you have to do is remove the knife," he said.

Despite the U.S. withdrawal from the nuclear deal, Rohani said Iran will continue to comply with the deal's restrictions on its nuclear activities in exchange for continued relief from sanctions by the European Union, Russia, China, and other major trading partners.

"Despite the sanctions, we will prove that we stick to our word and honor international deals," he said.

Iran's vow to stick with the nuclear deal was applauded by the European Union, which on August 6 issued a "blocking statute" aimed at protecting European businesses from penalties that might result from the reimposition of U.S. sanctions.

"We are determined to protect European economic operators engaged in legitimate business with Iran," EU foreign-policy chief Federica Mogherini said.

Despite the blocking law and other measures taken by the EU to encourage companies to continue doing business with Iran, however, hundreds of European and Asian companies have already announced their exit from the Iranian market, according to RFE/RL.

Moreover, the return of sanctions has increased tensions inside Iran, where in recent days protests have occurred in multiple towns and cities over the plummeting currency, water shortages, high prices, and alleged corruption in the political system.

Iranian Foreign Minister Mohammad Javad Zarif said the global reaction to Trump's move showed that Washington is the one that is diplomatically "isolated," not Tehran.

But he acknowledged the sanctions "may cause some disruption" for Iran's battered economy and claimed they were "endangering ordinary Iranians."

The current round of sanctions affects cars, carpets, and food exports, as well as Iranian imports of graphite, aluminum, steel, coal, and some software. Iran will also be banned from buying certain aircraft.

The second phase of U.S. sanctions, which takes effect on November 5, is aimed at blocking Iran's vital oil sales, which drive much of the country's economic growth, and could cause even more damage.

Several key buyers of Iranian oil -- including China, India, and Turkey -- have said they are not willing to entirely cut off their supplies from Iran.