Given the shortcomings of current embargoes and the need to halt Iran’s nuclear programme, the time for intrusive sanctions has arrived. Tehran should face an ultimatum with a short timeline: comply fully with all UN Security Council resolutions on its nuclear programme or the US, EU and any like-minded countries will use all means necessary to halt Iran’s international commerce, excepting humanitarian goods and food. If Iran did not comply, the quarantine could be imposed by biting sanctions and, if necessary, a naval cordon.

Before the expiry of the ultimatum, the International Energy Agency and Opec would organise a co-ordinated release of extra oil supplies to the market equal to the flow of Iran’s oil exports. Whatever the level of Iran’s exports, they could easily be replaced for many months with supplies of similar quality crude oil and products from excess Saudi spare capacity and strategic stocks.

As the noose tightens, allies would have to ready themselves in case Tehran decides to lash out. The already brisk flow of additional armed forces into the region would be stepped up and logistical preparations for a quarantine prepared. Saudi Arabia and the UAE could begin to redirect exports towards pipelines that avoid the Strait of Hormuz.

These preparations – along with a co-ordinated, precautionary increase in oil supplies from producers and strategic stocks – would underscore the credibility of the quarantine threat, increasing the odds that Tehran’s rulers will concede. If they did not, they would find themselves in an untenable position. Oil exports provide half of the Iranian government’s revenues and account for nearly 80 per cent of export earnings. Without this revenue stream, Iran’s economy would grind to a halt. If Tehran escalated the crisis, by disrupting oil production and exports, allied forces would have to respond appropriately.

One way or another, Iran’s defiant pursuit of nuclear weapons is going to lead to oil price spikes. A quarantine is technically an act of war, but so is attacking Iran’s facilities with cyberweapons. Quarantine-and-release could add a “fear premium” to crude prices, especially if Tehran chose escalation and conflict. But crude price spikes would be the result of military action or of Iran acquiring nuclear capabilities. Given the urgency and alternatives, there is little to lose in taking this step to stop Iran’s march towards nuclear weapons.

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