Using Germany as a case study, Benjamin Weinthal argues that strong business ties between Europe and Iran will pose a large obstacle if the Obama administration wishes to apply further pressure on Tehran.
To confront Iran, the United States must first confront Europe--and more specifically, the continent's powerful business lobby. This confrontation will come into focus in the next months. As Iran refuses Barack Obama's open-handed offer of engagement, the administration will turn towards sanctioning the Islamic Republic. And while there are surely ways in which the United States can tighten the economic screws on the Mullahs, it is Europe that has a much livelier trading relationship with Iran. In fact, Iran is far more economically dependent on Europe than even China and Russia.
Last year, the European Union did 14.1 billion euro worth of trade with Iran. It imports nearly four percent of its energy from Iran--a number that will mushroom thanks to the presence of companies like Royal Dutch Shell, France's Total, and Norway's Hydro-Statoil, all of whom presumably appreciate the extent of the country's vast oil and gas reserves.