“You can’t,” the official said, and with just six weeks until the next wave of U.S. sanctions hits Iran on Nov. 4, European diplomats acknowledge he was right.
The European Union has failed to design a workable legal shield for its companies in Iran to beat the global reach of the U.S. financial system and defy President Trump, the diplomats say.
Instead, Europe is engaging with Russia and China to show that it is at least searching for ways to ensure Tehran gets some benefits from its oil sales so Iranian President Hassan Rouhani has a reason to keep to the accord, according to seven European officials and diplomats.
Facing a collapsing economy at home, Rouhani is in a bind as he addresses the U.N. General Assembly on Tuesday, pressed by hardliners to abandon the 2015 deal as its economic benefits evaporate.
EU-Iranian trade this year is running at 2 billion euros ($2.35 billion) a month, but this is expected to fall as big European companies pull out and Iranian oil exports are choked off by U.S. sanctions.
European heavyweights Peugeot, Renault, Deutsche Telekom and Airbus are among companies that have pulled out of Iran since May, while Air France and British Airways have also now ended operations after falling traffic.
Denmark’s A.P. Moller-Maersk will stop shipping Iranian oil.
The accord, signed in Vienna by the United States, France, Britain, Germany, China, Russia and Iran, lifted sanctions in exchange for Tehran limiting its nuclear program, designed to prevent the country from obtaining a nuclear bomb.
Trump says the deal, the biggest foreign policy achievement of his Democratic predecessor, Barack Obama, failed to stop Iran’s ballistic missile program, its nuclear activities beyond 2025 or its role in wars in Yemen and Syria.
Britain, France and Germany say abandoning the pact does not address U.S. security concerns and instead threatens stability in the Middle East. Iran denies seeking nuclear weapons.
The U.S. Treasury is reimposing sanctions on Iran’s energy, auto and financial sectors in two phases, starting this August.
The EU has tried to neutralize the U.S. penalties with measures such as euro-denominated finance lines and a law that could make it an offense for EU citizens to comply with U.S. sanctions. But these have not reassured companies that they would be protected against U.S. fines or risks to their U.S.-based activities if they did business in Iran, diplomats said…