The emerging agreement will allow Iran to access over 100 billion dollars that are currently frozen, and to sell 2.5 million barrels of oil per day ■ The West, and the U.S. in particular, must decide how it will handle the accord’s effects on the global economy and power dynamics in the Middle East
If no last-minute problems crop up, Iran is expected to deliver its response to American reservations about Tehran’s latest demands by the end of the week.
Several Iranian lawmakers estimated that the expected American response may leave no other choice than to engage in a further round of talks to “polish” and “explicate” the final version of the accord. The working hypothesis is that the remaining controversies will not be an obstacle to signing the agreement.
Signing the accord does not absolve the U.S. and other Western countries of the need to examine two conflicting strategies. One relates to the response they adopt in case Iran violates the agreement or does not abide by the interim conditions for its implementation. The second is how to prepare for and deal with the ramifications and impact of the accord on the oil market, the global economy, and the balance of power in the Middle East. If answers to these issues exist, they are hard to find in public announcements and reports. One may assume that they have not yet made it to the drawing board.
Leaks and briefings related to the American response and the original European proposal are partial, but they do present a prolonged process that will stretch over more than five months, involving four steps, at the end of which the accord will take effect. Iran is by then supposed to rescind all its violations of the original accord, to transfer all the uranium it has enriched to other countries, and to cease the operation of and dismantle the centrifuges which were activated in violation of the accord.
Parallel to that, the U.S. will, in stages, remove all the sanctions imposed on Iran by the Trump administration, accompanied by a written commitment not to withdraw from the agreement as long as Biden is president. Iran will be able to obtain the 100 billion dollars that are now frozen in bank accounts across the world, to sell 50 million barrels of oil over the first 120 days, eventually reaching 2.5 million barrels a day – 1.5 million more than it sells now. According to Al-Jazeera, which published these details 10 days ago, sanctions on 17 banks and 170 financial institutions will be lifted on the first day.
The Iranian website Jomhouri-e Eslami, which published further details about the American response on Sunday, notes that Iran’s greatest achievement, in addition to the removal of sanctions, is President Joe Biden’s willingness to bring the approval of the accord to Congress, thereby at least partially acceding to Iran’s demand for guarantees that the U.S. will not withdraw from the accord. There is no certainty that Congress will approve it, but Biden could veto a negative resolution and bypass any opposition by Congress. Herein lies the urgency in approving the accord before the midterm election, which is expected to produce a contrarian Congress opposing Biden.
According to the Iranian website, despite American willingness to try and use congressional approval to ensure the accord lasts beyond Biden’s term, Washington rejected three other Iranian demands.
Iran predicated its signing and the implementation of the accord on European companies being allowed to operate and invest in Iran without suffering American sanctions as a result. The U.S. responded to this by saying that it allowed international companies to operate in Iran but that it could not oblige international corporations, including European ones, to invest in Iran.
In this context, Washington also rejected an Iranian demand for compensation or for granting insurance to international companies in case the U.S. again withdraws from the accord, for the same reason it cannot guarantee that another president won’t withdraw from it. Regarding Iran’s demand to join the SWIFT international clearing service, Washington clarified that it had no objections but that Iran had to meet the conditions set by SWIFT for every country that wishes to join. This, the Americans say, depends on a separate agreement between Iran and SWIFT.
All reports in Iran, Israel and in Western and Arab media indicate that there are no controversies over technical issues such as the extent of uranium enrichment and its quality and the method of monitoring nuclear installations, which will both remain as they were in the initial agreement.
Agreements on these issues were reached in the early stages of negotiations, which began over a year ago. This was what gave rise to a wave of optimism by partners to the negotiations and hopes that an agreement would be reached by last February – as was expressed by the Russian representative, Mikhail Ulyanov. However, the issue of removing Revolutionary Guards from the U.S. list of terror groups surfaced, and it seemed Iran was trying to lay new mines on the road to an accord.
President Biden decided not to accede to Iran’s demand to remove the organization from the list, but Iran clarified that it had never made such a demand. In any case, Iran’s response to a European proposal in early August did not include this demand. It’s still unclear whether this demand was artificial, if Tehran planned to concede in later rounds of negotiations, or whether Washington made a parallel concession by lifting sanctions on some civilian companies controlled by the Revolutionary Guards, This will become clearer once the accord takes effect and international companies start streaming into Iran.
Another issue relates to undeclared nuclear sites in which traces of uranium were found, possibly attesting to the conduction of experiments for military purposes. Iran insists that this investigation, held by the International Atomic Energy Agency, be closed. The U.S. and the agency object to this. The partial reports about Iranian and American responses do not relate to this issue. However, Arab and Iranian media have reported recently that this issue did receive a response, and that the U.S. has transferred the issue to the IAEA, which is expected to reach a separate agreement with Iran regarding the monitoring of these sites, and receive satisfactory information from Iran regarding activity at these sites. If the IAEA announces that it has reached such an agreement with Iran, Washington will “encourage” the heads of the agency to close its files associated with these sites.