President Donald Trump has attempted to reach a new agreement with the Islamic Republic of Iran since withdrawing the United States of America from the Joint Comprehensive Plan of Action in May 2018. Tehran’s leaders have a singular opportunity to craft a new deal favorable to them due to his eagerness. They could arrange for the lifting of economic sanctions and pumping in of American and European finance, technology and industry. In Trump’s own words, a new pact would “make Iran great” without seeking “leadership change.”
France, Germany, Britain, Russia, China, Iran and even the US discussed a new framework at the UN General Assembly in late September, according to French President Emmanuel Macron. The proposed new deal would have Iran permanently abjuring nuclear weapons, conforming to a long-term framework of peaceful nuclear technology, and contributing to regional stability and noninterference in return for the US lifting sanctions. Restricting the Islamic Republic’s ballistic missiles was set aside for future discussion. Iran’s Foreign Minister Mohammad Zarif disputed these terms, however, upon returning to Tehran.
China has also experienced the mercurial behaviour of President Trump. That is why it has been dragging its feet on reaching an agreement to end the trade war with the United States. Having won the trade war, China could well afford to drag its feet until the United States accepts its terms.
Iran could equally afford to wait until it sees the back of President Trump. It will, however, never negotiate with President Trump’s successor until he accepts Iran’s preconditions, namely lifting the sanctions and restoring the JCPOA.
Iran is talking from a position of strength. For now, it is weathering US economic sanctions. US sanctions have failed miserably to dent its oil exports. Moreover, it has not only become self-sufficient in gasoline but also a major exporter of refined and petrochemical products earning a very sizeable income to bolster its crude oil revenue.
On the military front, it emerged victorious in its efforts to support the regime of Syrian President Bashar al-Assad, its allies in Yemen, the Houthis, have taken Saudi oil industry hostage and above all it reduced its confrontation with the United States in the Gulf to a stalemate.
Military and social achievements accomplishments coupled with economic endurance have emboldened Iran in its attitude to negotiations with the United States.
Iran controls the Strait of Hormuz the most vital chokepoint in the world and is capable of blocking it at well. As a result, Iran is capable of taking the global economy as hostage by pushing oil prices to $140 a barrel and precipitating a global oil crisis.
That is why Iran has reached the conclusion that the US is capitulating and will be soon withdrawing from the greater Middle East, starting with the Persian Gulf, Iraq and Syria and leaving the whole region under Iran’s influence.
The global balance of power is shifting away from the United States towards the strategic Russian-Chinese alliance which will shape the world in the next two decades. Part of the shift is the emergence of Iran as the major power in the Gulf region and the strategic decline of Israel.
Dr Mamdouh G Salameh
International Oil Economist
Visiting Professor of Energy Economics at ESCP Europe Business School, London
Iran has a thing against Israel. It is currently heating up between Iran and Israel. The hate is palpable. What is the rest of the world going to do? Oil supply is potentially affected. Best if we all transition away from oil dependency. World peace suffers around oil dependency. What Iran/Russia does is now a major trigger point.
Once again, nice contents.