Blog #43 Iran will Implode with Trump’s Blockade

MSN…Robin Brooks

A U.S.-led blockade on Iranian ports could effectively shut down the country’s economic model by cutting off its primary source of external income, according to economist Robin Brooks.

Brooks posted that Iran’s large current account surplus —- driven overwhelmingly by oil and gas exports -- would be wiped out under a full maritime blockade. In a chart highlighting Iran’s balance of payments, the bulk of inflows comes from energy exports, which he argued would fall to zero if shipping is halted.

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“A blockade collapses the blue bars to zero,” Brooks said, referring to oil and gas trade. “This collapses Iran’s business model.”

Brooks drew a parallel to Russia, arguing that a more aggressive economic response following the invasion of Ukraine could have produced a similar outcome.

Robin Brooks

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