Iran's Sanctions Aren't Hurting Its Economy

Barack Obama calls the new round of Western sanctions against Iran the "toughest" yet, but take a closer look. U.S. sanctions approved last month have been hyped by the media for a supposedly crippling potential effect on Iran's refined-petroleum sector. In reality, multinationals with American ties are now forbidden from making investments of more than $20 million, down from $40 million, hardly a game changer. The same bill retains a loophole that gives Obama the right to issue waivers for companies from allied countries.

It's doubtful Washington will enforce the new sanctions. An administration official recently admitted he didn't know what punishment, if any, had been meted out to seven foreign companies—including Danish shipping giant Maersk—that hold $1 billion in U.S. government contracts alongside investments in the Iranian energy sector. Sanctions approved by the EU in July do not even cover energy, and firms like Germany's Thyssen-Krupp and Linde Group continue to service Iran's natural-gas and refinery projects. One sign the latest sanctions don't scare Iran: the Tehran Stock -Exchange is at its highest level since it opened 43 years ago.