What do Iran sanctions cost you? About 25 cents a gallon, experts say

Christian Science Monitor reports: Twenty-five cents a gallon – that’s about how much some international energy experts say the tough US sanctions on Iran’s oil industry are costing Americans at the pump.

As US consumers cope with gas prices that are approaching an average of $4 a gallon, some international trade experts say the cost of the sanctions the US imposes – as in the case of the Iran measures – is something political leaders should discuss more openly. Instead, they say, most politicians act as if sanctions affect only the country targeted – something these experts say isn’t true.

“The approach is always that the costs are for them and the benefits are for us,” says Bill Reinsch, president of the National Foreign Trade Council (NFTC), a Washington lobbying organization that generally opposes economic sanctions. “The Iran case is interesting,” he adds, “because of the impact of sanctions on our energy sector.”

What sanctions? Top five countries buying oil from Iran.

Energy experts say it’s difficult to pinpoint precisely how much sanctions on Iran are costing consumers as they filter down to the gas pump. But Lucian Pugliaresi, president of the Energy Policy Research Foundation, a Washington nonprofit organization that studies energy economics, says it’s possible to make an estimate.

The sanctions the US and other countries have slapped on Iran’s energy sector and on its central bank (aimed at curtailing its oil exports) are costing Iran about 300,000 barrels a day in exports, Mr. Pugliaresi estimates. When added to other factors affecting the international oil market, that decrease in exports may have added about $10 to the current price of a barrel for crude, he says.

And that $10 increase translates roughly to about a 25-cent increase in the cost of a gallon of gas in the US, Pugliaresi says.

Print Friendly, PDF & Email