The US and the European Union plan to expand their sanctions regimes against Iran, following Tehran’s unprecedented missile and drone attack on Israel.

In the coming days, the US will impose sanctions on Iran's missile and drone programs, as well as on entities that support the Islamic Revolutionary Guard Corps (IRGC), and the Defense Ministry, according to Jake Sullivan, the National Security Adviser at the White House.

“We anticipate that our allies and partners will soon be following with their own sanctions," said Sullivan.

The European Union’s top diplomat Josep Borrell says the bloc is preparing its sanctions in response to Tehran’s attack, after an emergency video conference of foreign ministers.

Germany, France and several EU members have publicly backed a proposal to expand the sanctions regime, seeking to curb the supply of Iranian drones to Russia to include the provision of missiles and cover deliveries to Iranian proxies in the Middle East, Borrell said.

Borrell said he supported the proposal and diplomats would work on it in the coming days so ministers could discuss it again at a meeting in Luxembourg on Monday.

Critics of the US response meanwhile, say Washington is refusing to snap back UN sanctions against Iran’s missile and drone program – which they argue would impose a serious cost on Tehran.

Others argued that Washington’s response is performative and avoids pressuring Tehran.

“If they keep the cash flowing to the regime, avoid snapback, and allies don’t designate the IRGC as a terrorist organization, we will know this is more of a media stunt than a pressure track,” said Foundation for Defense of Democracies Senior Adviser Richard Goldberg on X.

IRGC Terrorist Designation

While Borrell mentioned that some EU members raised the prospect of sanctioning Iran's elite paramilitary, the Islamic Revolutionary Guard Corps, he reiterated the EU's position that the IRGC could only be designated as a terrorist organization if an EU national authority found that the group had engaged in terrorist activities.

This, however, widely disputed by numerous experts who say that there is no shortage of evidence, admissible under the EU’s process, to designate the IRGC as a terrorist group.

Borrell said the EU was not aware of any such case, but he would ask the EU's diplomatic service to examine the matter again.

This has been Borrell’s position since calls grew louder in 2022 and 2023, amid the IRGC’s brutal crackdown on anti-regime protests in Iran – killing at least 500 protesters, including children.

The IRGC’s role in sending weapons to Russia for its illegal invasion of Ukraine has also been cited by experts, as another reason to proscribe the paramilitary entity.

While the Iranian authorities targeting of dissidents and opponents abroad has been occurring for decades, recently, Tehran has also been taking aim at Jews in Europe.

In December, a German-Iranian man was sentenced by a German court to nearly three years in jail for attempting to firebomb a synagogue in the city of Bochum on behalf of the Iranian government in November 2022.

In addition, there have been foiled assassination attempts on UK-based Iranian journalists.

UK Prime Minister Rishi Sunak is facing cross-party pressure to proscribe the IRGC, after Tehran’s attack on Israel over the weekend.

Canadian Prime Minister Trudeau is similarly being urged to follow through with his 2018 commitment to vote in support of listing the IRGC. In January, marking the four-year anniversary of the IRGC's shootdown of Flight PS752, Trudeau stated that his government was exploring ways to designate the Guards.

Iran’s Ability To Export Oil

This week US Treasury Secretary Janet Yellen hinted at new sanctions against individuals and networks financing terrorism and supplying arms, rather than enforcing existing US oil export sanctions.

When asked about Iran's continuing oil exports despite US sanctions, Yellen replied, "We have been working to diminish Iran's ability to export oil...There may be more that we can do."

Iran sells around 1.3 million barrels of crude oil daily – mainly to China.

Borrell meanwhile said all the ministers from the 27-nation EU strongly condemned the Iranian attack and reaffirmed their commitment to Israel's security.

The diplomat also voiced strong criticism of Israel's conduct of the war in Gaza, launched in response to the Hamas attack on Israel from the Palestinian enclave on October 7 last year.

"Today, ministers took a strong stance, asking all actors in the region to move away from the abyss, in order not to fall into it," Borrell told reporters after the meeting, called to discuss the repercussions of the Iranian attack.

Borrell warned that the Middle East would be in "full war" if every development in the current crisis is followed by an escalation.