Western diplomats can hardly believe their luck. Sanctions against Iran's oil exports are proving more effective than hoped yet the impact on the price of crude has so far been minimal.

It was not supposed to be this way. A decade of Iranian intransigence over its disputed nuclear program had finally eroded Western patience. Sanctions were supposed to be a painful, but necessary step.

Spurred by fears of a wider Middle Eastern conflict if Israel acted unilaterally to strike at Iran, Western governments decided to endure the consequences of tougher sanctions if they offered a peaceful route to resolving the issue.

But so far, the pain has mostly been inflicted on Iran.

Consider the situation in February after the European Union adopted its import ban. The International Energy Agency warned up to 1 million barrels per day of Iran's 2.6 million bpd of oil exports could be affected by tighter Western sanctions.

Brent crude had risen to a six-month high in early February, fueled by geopolitical worries, although the market was taking the looming sanctions impact "in its stride," according to the IEA.

Brent would later gain to nearly $130 a barrel, driven up by a combination of optimism over global economic growth and fears that this growth would drive up oil demand just as Iranian shipments withered.

But fears of a slowdown in global economic growth have sent the benchmark futures contract back down to near $100 a barrel, roughly where they were when Europe first publicly discussed a ban on imports of Iranian crude.

This result has been due more to luck than foresight. At the time the European ban began to be seriously discussed, Western governments believed a large release of strategic oil stocks would be needed to calm the oil market.

Now due to the global slowdown, and extra oil supplies from Saudi Arabia, the loss of some Iranian oil production has so far not affected the balance between crude supply and demand.

The benign situation could easily change, however. Oil traders are already nervous that the sanctions may working a little too well and flip the oil market into a supply deficit.

Restrictions on buying shipping insurance in European markets and stepped up measures by the United States against Iran's international financial transactions have greatly complicated Tehran's oil exports to major customers in Asia.