(Reuters) - Iran and world powers reached a framework agreement on Thursday on curbing Iran’s nuclear program for at least a decade.
The tentative agreement clears the way for talks on a future settlement that would allay Western fears that Iran was seeking to build an atomic bomb and in return lift economic sanctions on the Islamic Republic. They will remain in place until a final deal is reached.
The sanctions have halved Iran’s oil exports to just over 1 million barrels per day since 2012 and hammered its economy.
A complex range of restrictions has been imposed on Iran over several decades, starting with initial measures in 1979 after Iranian students stormed the U.S. Embassy in Tehran.
The major oil-related sanctions have been imposed by the United States and European Union to pile pressure on Iran over its nuclear program.
The U.S. Congress and the executive branch of the EU have both targeted Iran’s oil sector with layers of sanctions that could take time to remove fully even after any deal is struck.
Here is a summary of the measures.
Americans are prohibited from trading directly or indirectly with Iran’s oil sector, the government of Iran and individuals connected to the oil sector or in any financing of it. U.S. companies are also prevented from investing in Iran’s oil and gas industries or trading with them.
U.S. sanctions can also target financial institutions that engage in transactions with state-owned National Iranian Oil Company and its subsidiary Naftiran Intertrade Company.
Companies or individuals who breach the sanctions could face significant fines, asset freezes, the risk of being cut off from the U.S. dollar banking system or even be blacklisted themselves.
The EU has also imposed sanctions prohibiting trade with Iran’s oil sector. This includes any business with the whole of the country’s energy sector or government agencies related to it and any investments with the industry.
EU sanctions also prohibit European firms and individuals from importing or purchasing Iranian crude oil, petroleum products or natural gas and assisting in the construction of oil tankers as well as supplying vessels used to transport or store oil or petrochemical products.
Iran’s oil sector also faces hurdles over the transportation of oil and insuring cargoes.
EU and U.S. sanctions have blacklisted Iran’s shipping sector, including its top tanker owner NITC, meaning U.S. and European companies are prohibited from trading with it.
NITC is Iran’s main transporter of oil. The country’s top port operator Tidewater Middle East Co is also sanctioned, which has complicated shipments from export terminals.
Iran is also prohibited from securing services from international ship classification firms, which verify safety and environmental standards for vessels and are vital to insurance and port access for ships.
Under an initial agreement with Iran reached in November 2013, known as the Joint Plan of Action (JPOA), and rolled over subsequently until June 30, 2015, both the U.S. and EU relaxed some measures on Iran. This allowed the Islamic Republic access to some of its frozen oil revenues abroad and a modest easing of restrictions on oil sales to top importers including China and India.
The JPOA had provided Iran with some sanctions relief, including a temporary easing on insurance cover for permitted trades. However, ship insurers remain wary of extending cover on those trades due to concerns they may face sanctions if any claims are made and the claims process extends beyond the current expiry of temporary measures on June 30, 2015.
Writing by Jonathan Saul; Editing by Angus MacSwan