There are many reasons why the 1956 Suez Canal crisis was a pivotal moment in modern history. It symbolised the twilight of British imperial power, demonstrated the new force of Arab nationalism and created a rare breach between the governments of the US and Israel.

The Suez crisis was also a solitary example where sanctions have persuaded a government to withdraw its army from territory it had seized. When US President Dwight Eisenhower threatened to block crucial international loans to the UK, precipitating a run on the pound, the British, French and Israelis decided to pull out of the Suez Canal area that they had seized from Egypt.

After Russian troops moved into Crimea last month, the US and European governments warned that Russia would face tough international sanctions. The Obama administration has talked about ‘isolating’ Russia from parts of the global economy, both as a punishment for the annexation of Crimea and as a warning about further military adventurism.

“Together, we are imposing costs through sanctions that have left a mark on Russia,” Barack Obama said in Brussels on Wednesday. “And if the Russian leadership stays on its current course, together we will ensure that this isolation deepens.”Despite enthusiasm in the US, the history of sanctions since Suez demonstrates a decidedly mixed record in changing the behaviour of determined states, especially when it comes to military occupations. “Sanctions are not going to force Russia out of Crimea,” says Prof Daniel Drezner, at the Fletcher School at Tufts University and an expert on sanctions.

The US currently has 24 different sanctions programmes covering countries such as Côte d’Ivoire, Belarus and Syria, and companies involved in ‘conflict’ diamonds. But as recently as the 1990s, support for them seemed to be waning. At that time, the broad trade sanctions implemented against countries such as Iraq and Cuba were widely considered to have failed. In Iraq, they actually allowed the regime to cement its hold on power by giving it more control over who conducted trade and opened up ample opportunities for corruption. In Cuba, five decades of sanctions have still not managed to bring down the Castros.

Then the Clinton administration started to introduce ‘smart sanctions’ - measures targeted against specific individuals or entities, rather than entire populations. It designated members of the Serbian government and then used sanctions to block the bank accounts of Latin American drug traffickers in what became known as ‘la lista Clinton’.

After the 9/11 attacks, the Bush administration took these targeted sanctions to a new level by focusing on the global financial system. Bush-era sanctions blocked illicit financial transfers and sought to use the prevalence of the US dollar in global finance to shut out what it considered to be rogue banks. Through America’s central role in financial markets, the US Treasury department was able to say to international banks: either do business in the US dollar, or do business with the target bank.

The Treasury department also put huge emphasis on boosting its own intelligence capabilities. Alongside Humint (human intelligence) and Sigint (signals intelligence), the US added Finint (financial intelligence). In the aftermath of 9/11, senior Treasury officials travelled to the chateau near Brussels that houses Swift, the global payments system, to negotiate access to its data on financial transfers by terrorist groups.

Many of these new tools were used in recent years against Iran, which is now held up as one of the great successes of US sanctions policy. Yet for all Washington’s love affair with sanctions, big questions remain about whether they will have any real impact on the way that Russia, and its leader Vladimir Putin, behaves in the coming weeks.

One selling point of targeted sanctions is their supposed ability to breed discontent between the target government and its supporters. The US and European sanctions on Russia have been aimed at officials and businessmen close to Mr Putin as well as one bank with government connections.

“If you are able to damage the ability of the oligarchs to do business overseas, you might start to see cracks in the power base, fissures that would not have been seen,” says Juan Zarate, a former Bush administration official who helped develop financial sanctions and author of Treasury’s War. “They are not going to be a happy bunch.”

However, in some ways the sanctions could strengthen Mr Putin’s hand at home. If big businesses and their owners are forced to return wealth and assets to Russia, the Kremlin could have more influence over the business class, not less.

Even if American banking sanctions are a genuinely powerful instrument to influence states, they need to be used in a highly selective way because of the huge resentment they can generate. Most governments, including close allies, dislike intensely being told by the US with whom they can and cannot do business.

Washington’s new flair for sanctions also has one significant flaw: it is often easier to impose sanctions than it is to remove them. The Obama administration has used economic pressure to get Iran to the nuclear negotiating table, but without support from a very sceptical Congress, it has little room to offer sanctions relief to Iran in return for big concessions.

Trita Parsi, president of the National Iranian American Council, says the laws only allow the administration to offer Iran six-month waivers on many of the sanctions it currently faces as part of a final nuclear deal. “The sanctions tool is clearly powerful, but for the US to use it as a form of leverage in negotiations, the president needs to have much more room for manoeuvre,” he says.

For all these problems, US officials maintain that sanctions can have a powerful deterrent effect. They might not shift the new Russian borders but they can influence future actions. The sanctions announced by the US so far have been framed as punishment for Crimea, but their real intent has been to show a willingness to inflict much broader economic pain if Russia enters other parts of Ukraine.

Mr Drezner adds that the threat of sanctions can also provide an important lever in any eventual negotiation over a situation such as Ukraine. “Sanctions are often more effective as a threat than if they are ever carried out,” he says.