The White House announced today that it is moving forward with tough new sanctions aimed at squeezing Iranian oil exports. Iran currently exports about 2 million barrels of oil a day — roughly 2.5 percent of the global market. So how will the world make up the shortfall?

Its a lonely business, shipping Iranian oil. (Tim Chong/REUTERS)

But even if Iranian exports do fall by that much, the rest of the world should be able to pick up the slack. Saudi Arabia has increased production by 600,000 barrels a day since this time last year, and the U.S. Energy Information Administration estimates that spare capacity in OPEC countries is at about 2.7 million barrels a day. While that’s unnervingly low by historical standards, there are signs that it might be enough for now. Global oil demand has been slackening in the first two months of 2012 — China’s consumption grew by just 160,000 barrels a day, less than expected — and the recent surge in biofuel production has given the world some breathing room.

“There’s nothing in the numbers that should give the government pause” about going forward with sanctions, says Sarah Emerson, managing principal at Energy Security Analysis, Inc. (It’s also worth noting that the White House can exempt countries from sanctions so long as they make a good-faith effort to reduce Iranian imports.)

On the flip side, global oil prices are still high and a cut in Iranian oil would potentially make the world more vulnerable to any further disruptions. Civil strife in places such as Yemen, South Sudan and Syria has taken about 600,000 barrels a day off the market — not the end of the world, but painful when global supplies are so tight — and any more surprises could cause prices to rise further.

It also remains unclear just how much Iran’s exports will actually be squeezed. Much depends on whether the country can make up the drop in European and Japanese demand by selling elsewhere in the world. “China is one of the biggest unknowns,” says David Pumphrey, an analyst at the Center for Strategic and International Studies. While China did cut back on imports from Iran in February over a pricing dispute, it’s unclear just how far it will go to shun Iranian oil. Its domestic oil companies are constrained about passing on high prices to Chinese consumers, Pumphrey notes, which means that they may find the prospect of discounted Iranian oil too good to pass up. On the other hand, China may be wary of flouting a globally coordinated sanctions effort. “I don’t think China wants to be seen as opportunistic,” Pumphrey says.

Other countries, meanwhile, could help Iran out. India’s oil imports from Iran surged in January, according to Lloyd’s List, and Tehran may find buyers for its crude in countries such as Thailand and Burma. It is still unclear, however, whether Iran can find enough tankers to ship its oil. Last month, India’s Shipping Corp. canceled a shipment from Iran because European companies refused to insure the tanker. Iran’s state-owned shipping company has more than 50 tankers at its disposal, and the country will struggle to keep the oil flowing.

From Iran’s perspective, the biggest calculation to make is whether the drop in exports will hurt more than the benefit the country is experiencing from rising oil prices as tensions flare. A March poll of oil traders, conducted by Reuters, found that Iran could see its oil revenues cut in half, by $50 billion, if exports fall to 1.5 million barrels a day and it has to sell some of its oil at a discount. But that’s assuming that oil averages roughly $115 per barrel through the year — lower than its current price.

“If Iran really is forced into halving its exports, that changes the cast of negotiations,” says Emerson. “But the sanctions only work if everybody’s on board.”