WASHINGTON (Reuters) -- The economic impact of U.S. sanctions against Iran over its nuclear program is unclear and Iran has signed about $20 billion in energy contracts with foreign firms since 2003, said a U.S. audit report.

“U.S. officials and experts report that U.S. sanctions have specific impacts on Iran; however, the extent of such impacts is difficult to determine,” said the report by the nonpartisan Government Accountability Office, which was obtained by Reuters on Tuesday before its release later this week.
“Other evidence raises questions about the extent of reported economic impacts,” it added.
The report by the investigative arm of Congress comes at a sensitive time for the Bush administration as it is pushing for a third round of UN Security Council sanctions against Iran for its refusal to give up nuclear work.
President George W. Bush has pressed for tough measures against Iran during a trip to the Middle East over the past week.
The GAO urged Bush’s national security council to do a “baseline assessment” of sanctions against Iran and to report those results to the U.S. Congress.
“Without an overall assessment of the sanctions’ impact and subsequent reviews on a periodic basis, the Congress and the administration will continue to lack important information for developing effective strategies to influence Iran’s behavior,” said the report.
Since 2003, the Iranian government had signed contracts worth about $20 billion with foreign firms to develop its energy resources, said the report, adding that it was unclear if all those deals would be fulfilled.
It also said strict U.S. sanctions on state-owned Iranian banks could be circumvented if those banks turned to other financial institutions or funded their activities in other currencies than the U.S. dollar.
“Iran’s global trade ties and leading role in energy production make it difficult for the United States to isolate Iran,” the report said.
Increased oil demand, high oil prices and Iran’s huge reserves, helped Iran get more than $50 billion in oil revenues in 2006, the report said.
From 1987 through 2006, Iran’s exports grew from $8.5 billion to $70 billion, while Iran’s imports grew from $7 billion to $46 billion, it added.
Connecticut Rep. Christopher Shays, a Republican who requested the GAO report, said a system was needed to measure the effectiveness of sanctions on Iran.
“If we want to continue to improve the application of sanctions, we must first know how the current batch are working,” said Shays, adding he was pushing for congressional hearings on the issue and would soon introduce legislation implementing the GAO recommendations.