Brussels – Tehran: Europe and the Arabs

Between the imposition of sanctions on Iran and the ongoing war in the region, European trade with Tehran has been affected, with Germany, Italy, and the Netherlands being the hardest hit. Global energy markets are experiencing escalating tensions and a sharp rise in prices, as they react to the war in Iran and the targeting of energy facilities in the Gulf states, raising serious concerns about supply disruptions.

In this turbulent context, economic relations between the European Union and Iran appear to be reaching an advanced stage of decline, after more than a decade of gradual deterioration due to successive sanctions.

In late January 2026, the European Union imposed a new package of sanctions on Tehran, citing human rights violations and its continued support for the Russian war in Ukraine. Despite this, trade has not ceased entirely, but it has become significantly limited compared to previous levels. According to a report published by the Brussels-based European news network Euronews, titled "Trade Continues… But at a Shrinking Volume," Eurostat data shows that total trade in goods between the European Union and Iran reached approximately €3.72 billion in 2025. The EU imported goods worth €0.76 billion and exported goods worth €2.97 billion, resulting in a European trade surplus of around €2.2 billion.

In the services sector, trade volume reached €1.56 billion in 2024, comprised of €0.69 billion in imports and €0.87 billion in exports.

Despite these figures, Iran remains a marginal trading partner for the European Union, accounting for less than 0.1% of its exports in 2025, while its share of imports remained negligible. This represents a significant decline compared to the mid-2000s, when the share exceeded 1%. A downward trajectory for over a decade: The sharp decline in trade relations is most evident in the goods trade. In 2005, trade between the two sides reached €23.8 billion, before peaking at over €27 billion in 2011. However, sanctions imposed that same year led to a sharp decline, with trade falling to €6.1 billion by 2013. With the signing of the nuclear agreement in 2015, figures gradually began to rise, reaching €20.7 billion.

But this recovery was short-lived; trade fell again to €5.1 billion in 2019 and continued to decline with the reimposition of sanctions, reaching only €3.7 billion in 2025, nearly €1 billion less than the 2024 level.

Germany remains Iran's largest trading partner within the European Union, accounting for 31.8% of total trade in 2025. Berlin exported €963 million worth of goods to Iran, while importing €218 million.

Italy came in second with a 15.6% share, exporting €447 million and importing €132 million. The Netherlands ranked third with a 15.5% share, with exports of €517 million and imports of €58 million.

These three countries together account for approximately 62.9% of total trade between the EU and Iran, while the contributions of countries like France and Spain remained below €250 million each.

The dominance of European industries: The structure of trade reveals a clear imbalance favoring the European Union. Its exports to Iran are primarily concentrated in machinery and transport equipment, which amounted to €1.28 billion in 2024 (34% of the total), followed by chemicals at approximately €1.13 billion (31%).

In contrast, EU imports from Iran are concentrated in a limited number of sectors, most notably food and live animals at €305 million (37%), followed by chemicals (23%), and manufactured goods (22%). Raw materials, excluding fuels, account for only 11%.