via Think Progress

The new U.S. sanctions against Iran that kick in today — along with an E.U. oil embargo set to take effect Sunday — are expected to put significant pressure on an already faltering Iranian economy. The new U.S. sanctions, signed into law by President Obama, will penalize any foreign financial institution that works a deal through Iran’s Central Bank that deals with Iran’s petroleum sector, whether purchasing Iranian oil exports or selling petroleum industry-related products to Iran.

As the sanctions came into effect, Secretary of State Hillary Clinton said in a statement that she was granting exemptions to China and Singapore — bringing the total number of countries exempted up to 20. The Obama administration granted the waivers because they have, by the State Department’s designation, “significantly reduced their volume of crude oil purchases from Iran.” China got the exemption after reporting that its year-to-year Iranian oil imports between January and May were down by a quarter when comparing 2011 and 2012. Clinton went on:

Their cumulative actions are a clear demonstration to Iran’s government thatIran’s continued violation of its international nuclear obligations carries an enormous economic cost.

When the European Union oil embargo goes into effect July 1, Iran’s leaders will understand even more fully the urgency of the choice they face and the unity of the international community.

In a background briefing for reporters, a senior administration official added that the exemptions went to “major importers of Iranian oil.” The official said:

In pursuing the sanctions regime we’ve had the strong support of a broad coalition of countries all over the world who’ve stood united in sending the signal to Iran that its got to limit its nuclear program and address international concerns.

The official added: “It’s noteworthy that these are all the significant purchasers of Iranian oil. This is a diverse group of countries, some are U.S. allies and some are in the non-aligned movement.”

The reductions in exports — an Iranian official admitted Wednesday that export figures were down 20 to 30 percent — is likely to continue to depress an already hurting Iranian economy. “Iran’s currency, the Rial, has lost about 40 percent of its value since November 2011, and employment figures are increasing,” said the official. “Things will only go from bad to worse until Iran gets serious about addressing intelational concerns about its nuclear program.”

A potential Iranian nuclear weapon is widely considered a threat to both the security of the U.S. and its allies in the region, as well as the nuclear non-proliferation regime. U.S.U.N. and Israeliintelligence estimates give the West time to pursue a dual-track approach of pressure and diplomacy to resolve the crisis. Questions about the efficacy and potential consequences of a strike have led U.S. officials to declare that diplomacy is the “best and most permanent way” to resolve the crisis.