JCPOA Hopes Fade Ahead of Biden Mideast Trip

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Recent US-Iran talks failed to break the deadlock over the Joint Comprehensive Plan of Action (JCPOA), or Iran nuclear deal, despite the global energy crisis and spiraling inflation in Iran incentivizing a deal that would ease sanctions. A revived agreement would benefit both energy prices and regional tensions — with risks evident across the region, from tensions over Israel’s disputed maritime border with Lebanon to attacks on a US-backed gas project in Iraqi Kurdistan. A more united front against Iran could emerge, with US President Joe Biden's visit to Jeddah this week due to mark a reset in US-Saudi relations, and Israel-United Arab Emirates ties tightening.

EU-brokered talks in Qatar end-June were unable to breathe new life into the moribund indirect negotiations between the US and Iran to resurrect the 2015 nuclear deal that have been on hold since March. The doors remain open. But doubts about the prospect of success also continue to grow, with Iran clearly unafraid to flex its muscles. It recently targeted contested energy projects via its proxies, even if it has so far shown relative restraint, while the US last week blacklisted more companies allegedly involved in the sale of Iranian oil.

Deepening Pessimism

Reflecting the dwindling optimism, US negotiator Rob Malley called the Doha meeting “more than a little bit of a wasted occasion,” saying Tehran still didn’t appear to have decided whether or not it was interested in returning to the deal, the details of which have been all but finalized for months. Speaking in a radio interview, he accused Iran’s delegation of bringing up issues from the past that had been settled. That appears to include the vexed question of guarantees against any future US withdrawal from the deal.

Indeed, some analysts argue that Iran revealed its inability to forge a united negotiating position by not seeking in Doha to resolve what was thought to be the last major outstanding issue, namely its demand that the US remove the Revolutionary Guard from its list of foreign terrorist organizations. Iran may in fact have decided to soften its position here, insisting instead on sanctions being removed from Khatem al-Anbiya, the Guard’s sprawling construction conglomerate. Under the original nuclear deal, or JCPOA, it was removed from a blacklist that exposed organizations outside the US for transacting with it, but remained the target of earlier sanctions.

Either way, Iranian Foreign Minister Hossein Amir Abdollahian echoed Malley’s words when he blamed the US for the impasse, saying it “must decide if it wants a deal or insists on sticking to its unilateral demands.”

Limbo serves its political purpose in Washington and Tehran, for now. But it cannot continue indefinitely. Malley restated the US assessment that Iran was weeks away from having enough fissile material for a nuclear weapon. The head of the International Atomic Energy Agency (IAEA), Rafael Grossi, last week warned that the lack of visibility on Iran’s nuclear program — after Iran's removal of IAEA surveillance cameras a month ago — meant that Iran’s neighbors “could start to fear the worst and plan accordingly.”

Growing Dangers

Beyond its lack of cooperation with the IAEA and alleged foot-dragging, Iran and its proxies continue to keep up the pressure on their adversaries. This led to Israel shooting down three “hostile” surveillance drones recently launched by Hezbollah toward the Energean-operated offshore Karish gas field, which lies in disputed waters. Karish is due to start sending gas to the Israeli market in the third quarter.

A week earlier, the Khor Mor gas field in Iraqi Kurdistan was targeted in the latest wave of rocket attacks on the region’s energy sector. No one claimed the attacks, but Iran-backed militia groups in Iraq were widely suspected of being responsible, and Tehran in March openly claimed responsibility for missile strikes on the region. The US government is helping to finance the development of Khor Mor, which was temporarily suspended, and which is a key component in plans, drawn up in a recent study commissioned by the US Department of Energy, that aim to export Kurdish gas to Turkey by 2026, potentially displacing gas from Russia and Iran.

While the incidents do reflect the rising risks, no damage was done and it seems likely that they were essentially warning shots to remind Iran’s adversaries of what it is capable of if the situation deteriorates. They come at a time when the energy crisis is hurting the West, and Saudi Arabia is expected to up pressure on the US to formally abandon efforts to revive the nuclear deal during Biden's Jul. 15-16 visit.

The region’s security deteriorated dramatically in 2018, after the then-Donald Trump administration pulled out of the JCPOA and reimposed sanctions on Iran. If diplomacy fails this time, Iran could force that diplomacy, as it did in the past with some success, argues Riccardo Alcaro, a senior fellow with Italian think tank Istituto Affari Internazionali. “Then you will start seeing more attacks on US allied forces in Iraq, you will see more problems in Lebanon, perhaps in Syria too, in Yemen. You will probably see a surge in attacks against the Emirates and the Saudis. And, you know, chain reactions are difficult to control,” Alcaro notes.

Temporary Alignment

It is striking that, so far at least, there has been no such escalation. As President Biden himself noted, writing in the Washington Post last Friday, the frequency of Iranian-sponsored attacks compared with two years ago has dropped precipitously, while Yemen has been the most peaceful in years, since a provisional truce was signed in April. Even in federal Iraq, Tehran has been treading carefully in recent months, says Iraq expert Sajad Jiyad. This is partly because Tehran received strong blowback for past political interference, and partly because the caretaker government, the Revolutionary Guard and the office of Iran’s supreme leader are currently aligned, while uncertainty plagues the protracted government formation process, Jiyad argues. Prime Minister Mustafa al-Kadhimi actually visited Tehran just before the Doha talks, seeking to revive the on-off dialogue between Iran and Saudi Arabia that Baghdad has hosted.

By keeping the door to nuclear negotiations open, the US and Iran have managed to prevent the anti-Iran coalition Israel has called for from hardening. The energy crisis has helped, with high oil prices enabling Tehran to cope with US sanctions, and the EU desperate to revive a deal that could add 2 million barrels per day to the market. But the longer the talks drag on, the more vulnerable they are to being derailed.

Simon Martelli is senior Middle East correspondent at Energy Intelligence. A version of the article originally appeared in Energy Compass.

Nuclear Policy, Security Risk , Sanctions, Gas Processing and Gathering, Gas Supply
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