The US Treasury Department, responding to widespread criticism that US financial regulations have depressed sales of foreign medicine and other humanitarian items to Iran, on Thursday [July 25] issued an advisory that seeks to encourage these sales by underlining that they are not subject to US sanctions and expanding the list of medical devices that can be sold to Iran without a license.

The advisory, obtained shortly before its official release by Al-Monitor, does not, however, establish an authorized channel for transactions between US and non-sanctioned Iranian banks, reducing the chances that it will substantially boost US sales of food and medicine or resolve a host of other problems that complicate humanitarian transactions between the two countries.

US sanctions all contain exemptions for humanitarian items but such trade has dwindled as the nuclear stand-off with Iran continues. The crisis has intensified since last year, when European countries stopped buying Iranian oil and other traditional Iranian clients such as China, Japan, India and Turkey were forced to cut back imports or face US penalties.

Iran has had trouble adjusting to the sharp drop in oil earnings and is also facing difficulty repatriating those earnings. At the same time, European, Asian and other non-US banks are increasingly reluctant to have any dealings with Iran for fear of being subjected to additional scrutiny by the US government and banking regulators.