Tehran could gain billions of dollars from the 60-day relief from U.S. sanctions announced on Monday, but lifting restrictions built up over more than four decades hides legal, political and trade challenges that could take years, Reuters reports.
The issue is whether an interim agreement between the United States and Iran can translate into lasting economic relief, given the complexity of lifting a sanctions regime that spans U.S. law, international measures and private sector risk concerns.
UN, United States and the European Union have imposed sanctions and trade embargoes and frozen assets since the late 1970s over Iran's nuclear program, human rights abuses and support for armed groups in the region.
Under a 14-point memorandum of understanding signed by the United States and Iran last week, Washington must begin lifting all types of sanctions according to a schedule to be drawn up as part of a final agreement within 60 days, which can be extended.
On Monday, the U.S. Treasury Department issued a temporary general authorization allowing the production, supply and sale of crude oil, as well as petroleum and petroleum products of Iranian origin, until August 21.
The lifting of the remaining sanctions - if they happen at all - will be would represent a sharp reversal in U.S. Middle East policy, which has long been aimed at containing Iran's influence and using financial pressure to weaken its theocratic rule.
It would also be extremely difficult, as it would require executive action for some of the measures, congressional approval for others, and close coordination with the United Nations and other countries that have also imposed sanctions. Companies wary of decades of restrictions could also limit the impact.
"This is a tangled web of sanctions, and it's not just executive orders, it's sanctions passed by Congress," said Juan S. Zarate, deputy national security adviser for counterterrorism under former President George W. Bush.
Congress skeptical
Washington first imposed sanctions on Iran in 1979 after revolutionary students seized the U.S. embassy in Tehran and held diplomats hostage.
Since then, Congress has passed a half-dozen sanctions bills, and presidents have issued executive orders related to Iran's nuclear program and support for groups the United States designates as terrorist organizations, including Hamas, Hezbollah, and and Yemen's Houthis.
Since the beginning of 2025, the Treasury Department's Office of Foreign Assets Control (OFAC) has imposed sanctions on more than 1,000 individuals, vessels and aircraft.
Removing thousands of sanctioned entities would take OFAC at least a year, predicted Jeremy Panner, a partner at the law firm Hughes Hubbard & Reed and a former U.S. sanctions official.
President Donald Trump may rescind executive orders related to Iran, but some of the measures — including sanctions on "Hamas" and "Hezbollah" — are enshrined in law and must be repealed or amended by Congress, where the interim agreement is already drawing sharp criticism from fellow Republicans.
Untangling 40 years of sanctions would be extremely difficult, added Matt Zweig, policy director at FDD Action, the lobbying arm of the Foundation for Defense of Democracies.
"Any attempt to completely remove layer after layer of sanctions would be like peeling an onion — it would expose not only legal complexities but also political risks," explained Zweig, a former staffer on the House Foreign Affairs Committee.
The authorization issued on Monday could bring Iran up to $3 billion in two months, according to some estimates.
That amount could rise to "at least tens of billions of dollars" if the measures become permanent — by removing the rebate on Iranian oil, allowing sales to more buyers outside China and increasing exports, said Edward Fishman, a senior fellow at the Council on Foreign Relations. China currently buys about 90 percent of Iranian oil despite sanctions.
The new permit is broader than the one issued in March and includes not only oil and petroleum products but also banking, insurance and transportation services related to the oil trade, giving Tehran faster access to its revenues.
"There are a number of complex issues", said Stephanie Connor, a former OFAC official who is now a partner at Holland & Knight. She added that lifting sanctions could lead to a flow of funds to groups the United States considers a threat.
"Are we really going to allow money to start flowing to the Revolutionary Guard?" she asked, referring to the powerful paramilitary group that the United States has designated a terrorist organization.
Cautious companies
Banks, oil companies and insurers will face changing regulations, stricter customer due diligence and a higher risk of sanctions violations related to Iran's ties to countries such as China, North Korea and Russia. They also remain subject to separate sanctions from the UK, the UN, the EU and others.
"We have "overstrained" to some extent markets with the risk of doing business with or through Iran, so you can't just push a button and say, "Oh, it's OK to do business with Iran now," Zarate noted.
Companies that do business with Iran can still be sued by victims of attacks, who can legally hold investors and companies liable for supporting sanctioned groups under a 2016 law that advisers say is unlikely to be repealed.
Because of these risks, companies are likely to avoid Iran to protect themselves from legal and reputational damage while the Iranian government remains in power, said Brett Erickson, a principal at Obsidian Risk Advisors.
"We won't see large-scale multibillion-dollar commitments until things are much more sustainable and politically stable," he predicted. "We just have a long way to go."