A $500 Billion Maybe: Why Iran’s Big Moment Could Be Years Away

For every investor who sees opportunity in a post-sanctions Iran, there are others who see the same old legal morass.

The Islamic Republic is banking on a nuclear accord with world powers to unleash a flood of foreign cash into an economy crippled by decades of sanctions. Companies including Royal Dutch Shell Plc, BP Plc and Total SA say they’re willing to invest in the OPEC member.

Major investments, however, may take years as companies weigh the risk of Iran violating the agreement, which would bring sanctions back, according to analysts and former officials. Decades of hostile relations with Western powers and tight scrutiny by the U.S. Congress and Treasury could also make many investors reluctant to jump back right away.

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A final deal would also have to be endorsed by the UN Security Council, with a new resolution which may create two mechanisms to implement the terms of the agreement, according to two European diplomats.

“From the Iranian side, there is a risk that they will always complain that they are not getting enough relief,” said Mark Dubowitz, executive director at Washington-based Foundation for Defense of Democracies, which has argued for tighter measures against Iran. “Sanction relief is in the eye of the beholder.”

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