MUCH of Donald Trump’s sanctions strategy remains unclear, and on past experience, unpredictable. But it’s a fair bet that Tehran can expect to be under more pressure post January 20 next year.

Russia is still anyone’s guess, but noises from within the new administration have already made it abundantly clear that the new president wants to revive his “maximum pressure” policy to bankrupt Iran’s ability to fund regional proxies and develop nuclear weapons. And don’t expect a gradual build up; this will be an immediate action.

That will be something of a sea change from the current situation where, despite a substantial tightening of sanctions this year under President Biden, Iran’s oil exports are headed to their highest levels since prohibitions were reimposed by the Trump administration in 2019.

How Trump might go about this promised shock-and-awe campaign is not yet clear. Much of the fleet is already sanctioned and while enforcement could very easily be tightened, that may not be subtle enough to count as “maximum pressure”.

Trump could go for secondary sanctions on Malaysian transhipment hubs or Chinese ports or oil buyers, to the extent buyers are not already outside the US dollar system. Secondary sanctions also come with the possibility of ancillary benefits from Trump’s perspective in that they could be used as another stick to compel unaligned countries, including current US allies, to align with American objectives regarding Russia, Iran or other national security priorities, such as China.

But then a lot still depends on Russia. Trump’s moves on Iran do not happen in isolation and any crackdown on Moscow’s dark fleet could make the Iranian clean up that much harder as vessels move to support its exports. He also needs to factor what any divergence from an increasingly aggressive EU and UK stance on Russia looks like.

The status quo is unlikely to remain, but the range of possibilities for the Russia programme are wide. Expanding sanctions in an “escalate to de-escalate” scenario would likely see Trump weaponise secondary sanctions. Alternatively, Trump could pull support for Ukraine, dropping US sanctions, and forcing Ukraine into an unfavourable peace deal. The truth is, we don’t know and guessing what the landscape looks like between what Trump says, what he does and what the impact will ultimately be on the water remains just that: A guess.

Suffice to say, the industry should be paying very close attention to the risk and compliance detail that is emerging because this is not going to suddenly stop being an issue in 2025.

Richard Meade
Editor-in-chief, Lloyd’s List

Click here to view the latest Lloyd’s List Daily Briefing