Dan Drezner literally wrote the book on economic sanctions, so I don't dismiss his opinion lightly, but his optimism about the prospect that a gasoline embargo on Iran will produce the desired results strikes me as off-base:
That said, rejecting the gasoline embargo strikes me as a huge mistake. Iran is also not like North Korea in that there's actually a middle class in Tehran and environs that like their cheap gasoline very much, thank you. I concede that the possibility of a nationalist backlash is there -- but just because Ahmadinejad is painting the conflict as a civilizational one does not mean that Iranians are buying it. There's a decent possibility that of a lot of Iranians taking out their economic frustrations against Ahmadinejad's government -- especially after Iran's government spends so much on Hezbollah.
I mean, I dunno, let's think about it. You're sitting in Teheran, and all of a sudden western nations -- nations that have nuclear weapons -- impose a gasoline embargo and your financial situation goes to shit. These nuclear-armed western powers say the embargo will be lifted as soon as your government disavows uranium enrichment. Your government says they'll disavow uranium enrichment in the context of a regional nuclear-free zone -- i.e., Israel gives up its nuclear weapons. Israel, of course, won't do that and the nuclear-armed gasoline-embargoing western powers won't lean on Israel to do it. Do you blame Teheran, or do you blame Washington, London, and Paris? In principle, it could go either way, but I think that you only need to have very mild anti-Israel sentiments for this to look like the West imposing an unfair double-standard on the nation and people of Iran. Obviously, it's not going to look like that to Americans, but I have a hard time imagining that the "blame Iran first" interpretation of the situation is going to gain a lot of Iranian adherents.