Iranian Crude May Not Quickly Return
The war in Ukraine and the existing and perhaps new constraints on Russian oil trade have been layered on top of the U.S. Administration’s concern.
While war rages in Ukraine, negotiations continue in Vienna between Iran and the other parties to the Iran nuclear agreement. The EU-3 announced that they were taking a weekend pause to brief their ministers because both U.S. and Iranian negotiators had returned to their capitals with a partial draft agreement that needed to be reviewed. Reporting from press outlets indicates that the sides are both close to an agreement and that time is running out. Both of these conditions are true. Russia’s war against Ukraine, and the large-scale sanctions campaign led by the United States and Europe has complicated chances for an agreement because of Russia’s involvement in both the negotiations and, potentially, in any post-agreement implementation.
Iran’s foreign minister has said that he is ready to rush to Vienna to sign an agreement, but he also said that this was only possible if the West accepted Iran’s “red lines” – agreement on its priority interests. Iranian government officials have said that they will not be rushed. Press reports indicate that Iran believes that its leverage has increased with Russia’s war on Ukraine since it believes that the Biden administration wants more Iranian oil on the market and that Washington does not want a complicating nuclear proliferation crisis as well at the moment. Western sources responded that time is running out. As noted several weeks back, U.S. senior officials numbered the time left in one or two handfuls of weeks, and it is certainly down to a single handful at this point in time.
Three Major Issues Remain.
First an agreement between Iran and the International Atomic Energy Agency – which includes Iran providing information and potentially more access to international inspectors – bringing to resolution lingering questions about past Iranian nuclear activities that could have had a military component. After direct talks this weekend, Iran and the IAEA agreed on a series of exchanges and a timeline to resolve outstanding issues surrounding these activities. If everything works in these exchanges, the issue could be resolved by June 6. It is not clear that a return to the JCPOA is possible before the end of this set of exchanges. That depends on the parties. In addition, even after the exchanges, the IAEA could declare itself still not satisfied with Iran’s explanations.
The second is that Iran insists on the U.S. providing a guarantee that future administrations would not withdraw from the agreement. No U.S. administration can legally obligate a future one in this type of agreement, and a Senate-ratified treaty is out of the question politically. At best the Biden administration can urge future administrations to continue to adhere to the agreement as long as Iran does. Washington could agree that a future Biden or Harris administration would live up to the agreement, but this is as far as it can go under U.S. law. The final issue is exactly which sanctions that the United States would lift, including but not limited to taking the Iranian Revolutionary Guards Corps off of the U.S. list of Foreign Terrorist Organizations.
Finally, Russian Foreign Minister Lavrov announced that Russia wanted the U.S. to exempt any Russian dealings with Iran from U.S. sanctions related to Moscow’s war on Ukraine. An entire exemption of the small Russia-Iran trade from Ukraine sanctions is unlikely although the U.S. will almost certainly waive some sanction to allow Russia to, for example, remove enriched uranium from Iran or other activities associated with the accord. Broader exemptions are highly unlikely, and it is difficult to see Moscow standing in the way of an accord if both Washington and Tehran are on board.