Iran holds the fourth-largest proven oil reserves in the world, behind Canada, Saudi Arabia, and Venezuela. In a bid to halt Iran's suspected nuclear weapons program, some members of Congress want to make sure none of that oil reaches the rest of the world.
The plan, according to The Washington Post, is to present other countries with an ultimatum: Stop buying oil from Iran, or lose access to the U.S. banking system.
"If we're talking about things that could really hurt the Iranian economy, at the top of the list is taking their oil off the market," a Senate aide involved with the proposed legislation told The Washington Post.
Iran's oil-dependent economy has already been hammered by heavy sanctions. Last month, Bloomberg reported that Iranian officials were looking to boost non-oil exports in the face of a 50 percent drop in oil exports — much of it due to Western-led sanctions.
Experts disagree on what harsher sanctions would do to global oil markets. One solution proposed by Sen. James Inhofe (R-Okla.) would establish "Iranian Oil Replacement Zones" on U.S. soil to replace the 1.25 million barrels of oil per day that would be lost if the ban were passed, reports The Hill.
Supporters of the plan have been citing a study co-authored by Roubini Global Economics and Securing America's Future Energy (SAFE) that says slow economic growth in Europe and increased oil production in Iraq have actually led to a global surplus equivalent to most or all of the oil exported by Iran today, according to The Washington Post.
However, U.S. lawmakers still have the problem of appeasing some of Iran's very powerful trade partners: China, Japan, India, and South Korea. "The goal is to put pressure on Iran, not to pick fights with trading partners," a senior administration official told the Post.
According to The New York Times, talks in Afghanistan last month between the P5-plus-1 — the five members of the U.N. Security Council, plus Germany — and Iran resulted in no progress, with Iranian President Mahmoud Ahmadinejad declaring that his country would actually increase uranium production in the future.