Can ROTW sanction Iran by giving it zero internet access even to "elites" by refusing to peer.
You could try to bifurcate into allied and non allied, but even that would be flawed, especially in countries like the USA where it becomes a first amendment right to try to ban such connectivity. It’s very hard to kill the Internet in terms of connecting peers - that’s kind of the point of its design.
This is not as hard as you think.
Is the idea to unblock their internet if they let everyone use the internet and not just the elite? It won't work. Their elites will find workarounds and they'll leave the internet completely blocked apart from that.