Economic sanctions, energy consumption, and CO2 emissions in Iran: a system dynamics model

Hamid Balali, Mohammad Reza Farzanegan (), Omid Zamani and Mostafa Baniasadi

Policy Studies, 2025, vol. 46, issue 5, 718-747

Abstract: Economic sanctions have the potential to affect environmental factors through various channels, including income reduction and constraints on accessing finance and environmentally friendly technologies. This study aims to simulate the energy and environmental consequences resulting from international sanctions in Iran. To achieve this, we develop a System Dynamics model integrating a spectrum of variables spanning economic, social, and environmental dimensions, for the period from 2008 to 2028. Our simulation outcomes indicate that by 2028, sanctions are anticipated to precipitate a notable upsurge in CO2 emissions, ranging from 12.5% to 30% compared to the baseline scenario. The magnitude of this escalation hinges on a variety of factors, including energy intensity and scenarios related to economic growth. According to our findings, prolonging international sanctions could be a major barrier to improving energy intensity and lowering CO2 emissions. Given the potential environmental consequences of sanctions, international communities, particularly sanctioning countries, should consider the environmental impacts of sanctions in their policy-making decisions in order to reduce emissions damage.

Date: 2025
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DOI: 10.1080/01442872.2024.2358842

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