The ECONOMIST
Middle East & Africa | Let’s get this strait
Donald Trump says a deal with Iran is close. But he also says he is in no rush
Iran’s leaders are betting he needs an agreement more than they do
IF YOU ARE confused about the status of talks between America and Iran, you are in good company. Diplomats in Washington went into the long Memorial Day weekend hopeful that a deal might be imminent. Officials from Pakistan and Qatar, which are helping mediate, visited Tehran, the Iranian capital, on Friday. After a call with regional leaders on Saturday President Donald Trump said a deal had been “largely negotiated” and would be unveiled “shortly”.
Yet on Sunday the American president said his representatives should not “rush” to get it done. His advisers now say it could take another week. For good measure, Mr Trump also posted an image of an American warplane carrying a bomb with the words “THANK YOU FOR YOUR ATTENTION TO THIS MATTER” on it.
America and Iran are almost two months into what was originally meant as a two-week ceasefire. They are indeed closer to an agreement, but not the sort of war-ending agreement that Mr Trump suggests. At best it will probably buy time for further, trickier talks—it will be a deal to keep talking about a final deal. And there are still obstacles to reaching even a limited pact, both in Tehran and Washington.
The emerging accord would probably extend the existing ceasefire by at least 60 days and outline a set of broad principles: reopening the Strait of Hormuz, imposing limits on Iran’s nuclear programme, and granting Iran relief from sanctions. Both sides would spend the summer negotiating how to implement those principles. In a preliminary agreement, for example, Iran would probably agree to a years-long moratorium on uranium enrichment. America and Iran would still need to work out the details: who would verify Iran’s compliance? What milestones would it need to reach before America lifted sanctions?
Serious points of contention remain, even over the principles. One is Iran’s demand that it receive significant economic benefits the moment a deal is signed. American officials say they are willing to issue a waiver to allow Iran to export some oil, but not to take further steps—such as releasing billions of dollars in Iranian assets frozen in foreign banks—until there is progress in the nuclear talks.
Another dispute is centered on Iran’s stockpile of more than 400kg of uranium enriched to near-weapons-grade. America’s president and his allies claim that Iran has agreed to ship it outside the country. Iran says it will do no such thing, although it is willing to downblend the uranium to a lower level of purity in situ. Negotiators are searching for a compromise: perhaps the International Atomic Energy Agency, the UN’s nuclear watchdog, could take possession of the stuff and oversee its dilution.
Iran needs a deal to lift the American blockade of its ports, which have hobbled its oil production and may soon force damaging shut-ins of its oil wells. Its onshore oil storage is over 80% full. But Iran’s leaders reckon Mr Trump needs a deal even more urgently and are thus in no mood to make further concessions.
Such disagreements are one reason for Mr Trump’s seeming about-face. His other problem is political. In his first term he abandoned the Joint Comprehensive Plan of Action (JCPOA), the nuclear deal with Iran negotiated by Barack Obama and signed in 2015. The president has spent a decade inveighing against the JCPOA as “one of the worst deals ever made”.
Yet the deal he is now negotiating sounds not dissimilar to the one he scorned. Mike Pompeo, who served as secretary of state for most of Mr Trump’s first term, compared the new deal unfavourably with the JCPOA. “Not remotely America first,” he wrote on social media. Steven Cheung, the White House’s communications director, replied that Mr Pompeo “has no idea what the fuck he’s talking about”.
Perhaps Mr Trump can ignore the likes of Mr Pompeo, whose political career may be over already. Opposition in Congress is a bigger problem: depending on how the deal is structured, it could trigger a 2015 law that requires it to undergo congressional review. Normally supine Republican lawmakers are starting to look restive. They are terrified that high petrol prices (now above $4.50 a gallon, on average) will cost them in the November midterms. They are also angry about several of Mr Trump’s other recent decisions, from the $1.8bn slush fund he created for political allies with taxpayers’ money to his endorsement of Ken Paxton, a man impeached by members of his own party for alleged bribery, as the next Republican Senate candidate for Texas.
Roger Wicker, the chairman of the Senate armed services committee, called the emerging deal with Iran a “disaster” that would “not be worth the paper it is written on”. Lindsey Graham, a Republican senator and Trump confidante, warned that it might constitute “a major shift of the balance of power in the region”.
Yet the criticism cuts both ways. On May 19th the Senate advanced a war-powers resolution after four Republicans broke with their party to push it forward. The House of Representatives had been due to vote on a similar measure on May 21st. When it looked as if the bill might pass, Mike Johnson, the House speaker, abruptly halted a series of votes and gavelled the body into a long recess. Mr Trump is in a bind: a deal could split his caucus, but so could another round of fighting.
It helps that America’s Arab allies are pushing for a deal too. Even the United Arab Emirates, by far the most hawkish of the bunch, has in recent days quietly started urging Mr Trump to end the war. Everyone in the Gulf is desperate to reopen the strait and end months of economic crisis. Oil traders were excited about talk of an agreement. Brent crude fell by 6% when markets opened in Asia on Monday morning, to $94 a barrel. Yet a preliminary agreement may not deliver immediate relief.
Assume that Iran agrees to reopen the strait. To get oil and gas flowing again, tankers would have to make their way back to the region. Some are now picking up cargoes in the Atlantic; it will take them months to complete their current deliveries and sail back to the Gulf. Producers would then need to restart mothballed oil wells and gas-liquefaction plants, a fiddly process that can take weeks. All of this will require far longer than 60 days. That leaves producers, shippers and insurers with a dilemma: can they gamble on a return to normal in the Gulf when there is no guarantee that America and Iran will reach a final deal, nor that the ceasefire will be extended again?
Some diplomats and analysts in Washington think Mr Trump will not want to resume the war so close to the midterms. Others believe he has already written off the election and fear that summer talks will end with autumn fighting. Either way, even if America and Iran reach a deal in the coming days, the uncertainty is likely to linger for months. ■
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