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What to Expect If You’re Expecting an Iran Deal

July 18, 2014

By Jonathan Ruhe - Associate Director of The Gemunder Center for Defense and Strategy

This is the final countdown to the not-so-final deadline for the not-so-final deal on Iran’s nuclear program. Under the terms of the Joint Plan of Action (JPA) implemented by Iran and the P5+1 (the five permanent U.N. Security Council members, plus Germany), Sunday is the end of the six-month interim period for negotiating a comprehensive settlement on Iran’s nuclear program. While it remains difficult to predict any actual outcome for this latest, and perhaps ultimate, round of talks, there are several important things to consider going into the weekend.

First, temper any expectations of what Iran can or will credibly offer to restrict its nuclear program as part of a final deal. Headlines in recent days mention a relaxation of Iran’s position on its enrichment capacity, but even this less extreme demand would essentially keep its existing nuclear infrastructure in place. This would leave Iran’s breakout timing – roughly 3-4 months – fundamentally untouched, even if it converted its low-enriched uranium to a less immediately-threatening form. Indeed, because this material can likely be reconverted in a matter of weeks, Iran is only offering to “freeze” something it can just as easily thaw. This is also far short of even the Obama Administration’s oft-cited benchmark for rolling back Iran’s program to at least a 6-12 month breakout timeframe. Moreover, this Iranian offer wouldn’t freeze the overall growth of its nuclear program. Centrifuges would keep spinning, as they have under JPA, expanding Iran’s stockpile in the process. In just the six months since the JPA was implemented, this has already expanded from approximately three to now four bombs’ worth of low-enriched uranium.

Overall, therefore, the ostensible compromise offered by Iran’s negotiating team is to keep the foundation of the nuclear program it expanded rapidly in the year prior to the JPA. However, even this offer came under fire publicly from hardliners in the regime’s clerical and military establishments. The administration of President Rouhani – including the Foreign Ministry team tasked with nuclear talks – is motivated at least in part by its mandate from the Iranian electorate to secure significant sanctions relief as quickly as possible. As recent comments by Supreme Leader Khamenei indicate, this incentive is not necessarily shared by the regime’s ultimate decision-makers. Even on the off chance this is merely a last-minute bargaining tactic, it cramps the ability of Iran’s negotiators to credibly agree to anything that remotely approaches an acceptable deal for the United States and its allies.

ZARIF-MEET-THE-PRESSSecond, any final deal would not actually be final. If an agreement somehow is reached by July 20, it would be historic mainly in the sense that it would recede rapidly into history. As agreed in the JPA, any of the mooted restrictions on Iran’s enrichment capabilities in the preceding paragraphs would be lifted surprisingly quickly (Iran is pressing for 3-7 years, the United States for at least 10). Furthermore, the United States would be removing sanctions over this period. Tehran would thus be primed to emerge from an arms control agreement stronger than when started, with little incentive to continue limiting its program. A brief but telling glimpse into Iran’s mindset on this issue was provided by Foreign Minister Zarif’s Meet the Press interview this week, when he called limits on Iran’s centrifuges “arbitrary restrictions.” In fact, Iran agreed to these restrictions as a signatory to the Nuclear Nonproliferation Treaty (NPT), even though it now uses that treaty to justify its proclaimed “right” to enrich. Given that the JPA effectively sides with Iran on this point by saying it will be treated like any other NPT member once the comprehensive agreement expires, it is unsurprising to hear Iran suggest it will vastly expand its enrichment program, either under a final deal or beyond it.

Third, the July 20 deadline is not final either. The JPA allows for the six-month interim period to be renewed by mutual agreement, but apparently the specifics are subject to debate or confusion. The wording of the JPA itself seems to imply the interim deal would have to be renewed tout suite, potentially dragging negotiations into January 2015 while sanctions remain weakened and Iran continues producing low-enriched uranium. However, U.S. State Department officials have stated a new interim framework could be part of renewal discussions, and other officials recently said the deadline could be postponed for periods much less than six months. In effect, there might need to be new negotiations about having further negotiations.

These are not just hermeneutics. As JINSA’s Gemunder Center Iran Task Force argued in reports this past January and May, the existing interim framework is not making an acceptable final deal more likely to be achieved. A corollary is that simply renewing it would compound the disadvantages accruing to the United States. Unless the United States could somehow negotiate a new interim agreement that evaporates instead of freezes key parts of Iran’s nuclear program – a prospect made less likely by the existing interim agreement – any significant extension of the current framework thus should be viewed as cause for concern rather than a sign of progress.

Update on Israel’s Operation Protective Edge – July 15

July 15, 2014
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Hamas fired 125 rockets at Israel today. 50 of them were fired while the IDF suspended strikes for six hours.

Of the total rockets fired by Hamas since the start of Operation Protective Edge, 953 of those rockets hit Israel and approximately 213 rockets were intercepted by the Iron Dome missile defense system.

The IDF has targeted over 1682 terror targets.

Here is the Iron Dome missile defense system in action:

Update on Israel’s Operation Protective Edge – July 14

July 14, 2014

Hamas has fired 100 rockets at Israel today. Since the start of the Operation Protective Edge, more than 1,000 rockets have been fired.

The IDF has targeted over 1,474 terror targets.

Hamas has attacked cities across Israel and increased their range to cities as far north as Zichron Yaakov, Binyamina, Hadera, and Haifa.

Take a look at this interesting graphic that shows the threat Israel is facing:

70-percent

ISIS and the End of the Old, Old Order

June 26, 2014

By Jonathan Ruhe, Associate Director – JINSA Gemunder Center for Defense and Strategy

Source: UK National Archives

Source: UK National Archives

Thumb through any of the recent articles on the Islamic State of Iraq and al-Sham (ISIS), and almost inevitably you’ll read something describing “the end of Sykes-Picot” and “the new Middle East order” interchangeably. To illustrate this point, detailed graphics will show you how the growth of ISIS is “redrawing the regional map” by sweeping over the lines arbitrarily penciled in nearly a century ago.

The word “order” is thrown around quite casually in most of these pieces. Though the academic debates are quite contentious, it is probably simplest to understand it as the ways in which states and other actors interact with one another regionally or globally. This is a function of many things, including the degree of economic interdependence and development between states, the ideologies their government adhere to, and the balance of military power between them. These various elements determine the stability of a regional order. For example, the interwar European order was highly unstable, in large part because it was split between states with sharply competing ideologies and economies, and because those least satisfied with the existing order were the most determined and able to amass the military might to overthrow it. Compare this to postwar stability in Western Europe, as erstwhile enemies became an economically-interdependent community of liberal democracies protected from each other and from the Soviet bloc by unchallengeable U.S. military power. These shifts were reflected in a new map of Europe after 1945, but explaining their causes goes far deeper than the lines drawn at Versailles, Saint-Germain and Trianon.

Similarly, change and instability in the Middle East is primarily about orders, not borders. At first glance, the current Middle East map largely resembles the contours sculpted by the Sykes-Picot Treaty and ensuing events around the end of World War I. The former French sphere of influence remains in the shape of Lebanon and Syria, and the British in the form of Iraq and Jordan. Moreover, like a century ago, the future status of Palestine remains unresolved.

However, the actual Sykes-Picot order was replaced decades ago. Anglo-French military and economic supremacy – which that treaty was designed to ensure, and which was also evident in British influence in the Persian Gulf – were discredited by World War II and destroyed by the Suez Crisis in 1956. This was replaced by a Cold War order centered on new actors, new ideologies and new conflicts. It loosely grouped U.S.-aligned conservative, oil-producing monarchies (and Israel, in parallel) against Soviet-backed pan-Arab socialist republics (including at times the PLO). Most major conflicts erupted along this fault line, rather than over the Sykes-Picot borders, including: the 1958 crises in Iraq and Lebanon, civil wars in North (1962-70) and South Yemen (1963-7), Israel’s wars with Egypt (1967-70, 1973) and Syria (1967, 1973, 1982), and Black September in Jordan (1970-1). The bloodiest conflict – the Iran-Iraq War (1980-8) – did not fit this pattern, yet neither was its outbreak or perpetuation symptomatic of the lines drawn by Sykes-Picot. (One casus belli – demarcating the Shatt al-Arab waterway – was a result of agreements signed both long before, and long after, Sykes-Picot.)

The precipitous collapse of the Soviet Union and rapid demolition of Iraq’s offensive military capabilities (at the time of the Gulf War, one of the largest and most battle-tested forces in the world) ushered in the current Middle East order. It is characterized first and foremost by U.S. military predominance. The United States has not hesitated to use force when it so chooses, whether for containment (Iraq in the 1990s), regime change (Afghanistan and Iraq in the 2000s), some gray area in between (Libya in 2011) or counterterrorism (Afghanistan, Sudan and Yemen). The mere presence of such forces in the Persian Gulf helps also maintain the free flow of energy. Moreover, Washington has sought to translate this power into diplomatic and economic spheres – to resolve many of the lingering divisions from previous orders – be it brokering peace or trying to promote reform.

The shift between these three orders cannot be understood by looking at maps. (The best counterexample is the unification of Yemen in 1990, as South Yemen had little choice but to be absorbed by the anti-Soviet North once the former’s Soviet lifeline expired.) Three successive generations of cartographers could teach their children the same basic map of the Middle East – a luxury utterly foreign to three contemporaneous generations of historians. The ongoing cantonization of Syria and its spillover to Iraq may finally give the youngest cartographer gainful employment, but the historians have been busy for several years already.

This is because ISIS is not the one credibly threatening to change the Middle East order. The shift to a new Middle East, whatever it may be, would not be in the hands of them, Iran, or anyone else alone. Almost single-handedly, the United States created and maintained the existing order, and it remains the only country capable of sustaining it – or letting it unravel. Therefore, “the new Middle East order” is not an issue of whether the Syria-Iraq border dissolves. It is an issue of whether the United States maintains the core of its decades-old mission in the region: the mutually-reinforcing assets of a credible military presence, a commitment to the security of its allies and the promotion of a stable transition to genuine democratic reform. To call the chaos in Iraq and Syria “the end of Sykes-Picot” misses the mark. Their pencil lines may at last be erased, but what’s currently at stake has very little to do with the order they established. It has everything to do with the one we established.

Developments in Iraq

June 23, 2014
tags: , , ,
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By Benjamin Runkle, JINSA Director of Programs

The recent developments in Iraq – in which a coalition of Sunni militants led by the Salafist terrorist organization the Islamic State of Iraq and Syria (ISIS) seized several key Iraqi cities, including its second largest metropolis, Mosul – have been difficult for Americans to watch. In particular, for veterans and families of those servicemen and women who made the ultimate sacrifice for our nation and to give Iraqis a chance at a better life, it is depressing to see their sacrifices squandered.

As a veteran of Operation Iraqi Freedom and somebody who has worked on Iraq policy issues in DOD, the NSC, in Congress, and at the RAND Corporation, I understand this frustration. But despite the temptation to issue recriminations and seek partisan advantage, for now it is far more important to fix the problem than to fix the blame. For contrary to the Obama administration’s favorite dismissal of calls for intervention in Syria and elsewhere, the current crisis in Iraq is not merely “somebody else’s civil war.” ISIS’s gains in Iraq represent a significant threat to America’s national security.

Even before the fall of Mosul, Tikrit, and Bayji, ISIS posed a clear and present danger to the United States. More than 11,000 foreign fighters are believed to have flocked to Syria to make jihad, including some 3,000 westerners, approximately 100 of which are Americans. This dwarfs the 3,000-4,000 “Afghan Arabs” that joined the mujahedeen in Afghanistan in the 1980s and later formed the backbone of al-Qa’ida. Additionally, from Aleppo in western Syria to Fallujah in central Iraq, ISIS controlled territory stretching more than 400 miles, the largest swath of land ever held by a terrorist organization. In January, Director of National Intelligence James Clapper testified before Congress that US intelligence had picked up indications of “training complexes” within Syria “to train people to go back to their countries and conduct terrorist acts.” Consequently, National Counterterrorism Center Director Matthew Olsen, Secretary of Homeland Security Jeh Johnson, and senior FBI officials have all stated that terrorism emanating from Syria is their greatest concern. ISIS itself evolved from the remnants of Abu Musab al-Zarqawi’s al-Qa’ida in Iraq (AQI) network, which conducted attacks in Jordan (including the 2002 assassination of an American diplomat). In early May, Saudi Arabia arrested 65 suspected ISIS operatives believed to be plotting an attack in the kingdom, and on the 24th, Mehdi Nemmouche, a 29-year-old French national who had fought with ISIS in Syria, shot and killed four people at Brussels’ Jewish Museum.

This threat has only been compounded by ISIS’s recent gains in Iraq. As the Iraqi Security Forces abandoned Mosul, a city of 1.8 million, they left behind logistics depots filled with U.S.-made Humvees, tanks, helicopters, rockets, and countless small arms which are now all in the hands of an organization deemed too violent for al-Qa’ida. Worse, perhaps, ISI looted as much as half a billion dollars from the Mosul Central Bank, making it the wealthiest terrorist franchise ever. Combined with the increased luster of a successful military campaign, this cash in hand will enable ISIS will attract even more foreign fighters to its banner and training camps. The increase in territory controlled by ISIS also gives it greater strategic depth, and thus greater freedom of action.

Since the 2001 9/11 attacks, both the Bush and Obama administrations have recognized the prevention of terrorist sanctuaries as a vital U.S. national interest. If the policymakers who allowed al-Qa’ida to establish a safe haven in Afghanistan before that attack can be (partially) excused due to a lack of imagination regarding the potential consequences, no such excuse exists today. Yet despite the temptation to immediately launch air and/or drone strikes against ISIS now that it occupies a definite territory, this would be a rash and pointless exercise. First, because the U.S. withdrew almost all its intelligence collection assets from Iraq in 2011, we do not have a good sense of whom to target. Moreover, although we can likely kill a fair number of ISIS leaders in the near-term, the lesson of our drone campaigns in Pakistan and Yemen show that without being able to hold ground or address the underlying causes behind the local population’s support for the terrorists, we will likely be starting an endless cycle that may buy time but will never be strategically decisive.

Instead, the United States and our allies must commit to a sustained campaign to defeat ISIS. Although President Obama’s speech at West Point last month was generally weak tea with regards to grand strategy, his proposed counter-terror strategy centered on building partnership capacity and fighting al-Qa’ida through local proxies is a viable course of action. Yet simply throwing money at the problem is insufficient. Although seed money is important, whatever proxy forces we support must be continually maintained like a garden, with trainers, advisers, and intelligence and logistics support provided in lieu of watering and weeding. This is precisely what the Administration failed to do in Iraq post-2011, and goes a long way toward explaining why the ISF performed so abysmally in the Battle of Mosul despite outnumbering the ISIS and allied Sunni militants by roughly 15-to-1. Such a campaign will inevitably require the reintroduction of some ground forces, not in a combat role, but mainly Special Forces conducting their traditional foreign internal defense mission and support personnel necessary for targeting and intelligence support. We need to do this not to redeem the sunk costs we have paid in Iraq in terms of lives and treasure, but to prevent the next 9/11. Consequently, we also need to begin to seriously arm moderate Sunni forces in Syria to pressure the ISIS on two fronts, lest it simply recede like water wherever it is pressured.

Although such a sustained military effort is necessary to defeat ISIS, it will not be sufficient. ISIS did not roll through the Sunni Triangle alone, but rather in coordination with various Ba’athist organizations and Sunni tribal militias. The latter of these forces supported us during the Anbar Awakening against AQI in 2006-2007, but were driven back to partnership with the jihadists out of desperation created by Iraqi Prime Minister Nouri al-Maliki’s increasingly authoritarian and sectarian rule. Almost immediately once U.S. forces were withdrawn from Iraq in December 2011, Maliki began arresting Sunni political rivals, purging the ISF of professional Sunni and Kurdish officers in favor of less competent/more pliant Shi’a replacements, and using the ISF to violently suppress legitimate political protests in the Sunni Triangle. Consequently, in order for U.S. military support to have any lasting impact – as well as not be seen as merely defending Maliki’s sectarianism – it must be paired with significant, immediate political reforms by the Maliki government.

It is true that since 2011 the United States has possessed little leverage over Maliki as his governance descended into autocracy. But deploying an initial tranche of trainers/advisers would provide us with more leverage, and if paired with significant outreach to assure our formal tribal allies (presumably we still have their cell phone numbers) that this is strictly an anti-ISIS measure whose continuance will be predicated on last political reform, then this intervention can be done without appearing to take Maliki’s side against Iraq’s Sunnis. If Maliki remains intransigent, a bigger decision will have to made: whether to accept that our counter-ISIS campaign is only a stopgap measure necessary to buy time for more positive developments in Baghdad, Syria, or beyond; or to withdraw all support for the ISF and instead base our counter-terror efforts out of a region that would gladly host U.S. forces . . . Kurdistan. This latter outcome would open a separate Pandora’s Box of challenges in terms of regional diplomacy, but the reality is that if Maliki remains in power and refuses one last effort at national reconciliation, there will be no Iraq to save. In that case, Kurdish independence would be a de facto reality anyways. As steadfast as the Kurds have been in support of U.S. interests in the region, this option should only be considered as a last resort – and may be sufficient to either scare Maliki straight or to provoke his political coalition into dumping him.

One option the Obama administration must avoid despite its attraction to a certain set of foreign policy pundits, self-proclaimed realists, and professional contrarians, is to ally ourselves with Iran to resolve the issue, a possibility Secretary of State John Kerry raised and quickly backed away from. This partnership would be disastrously self-defeating for several reasons. First, given that a proximate cause of Sunni acquiescence to ISIS’s campaign stems from fear of Persian dominance of Baghdad, openly working with Iran to resolve the current crisis would merely pour gasoline on this sectarian fire. As General David Petraeus recently noted, “This cannot be the United States being the air force for Shia militias,” which Sunnis understandably perceive as being tools of Tehran. Second, America’s regional allies are already disturbed by U.S. outreach and concessions to Iran on nuclear-related issues. This concern will only be exacerbated by any implicit partnership with Iran in Iraq. Legitimizing Iranian intervention in Iraq will only further drive both domestic Iraqi and regional Sunni actors away from the moderation upon which hopes for regional stability depend.

Finally, suggestions that we can come to a modus vivendi with Iran in Iraq ignore that Tehran has significantly different interests at stake there. Simply put, Iran can live with a Shi’a-dominated government in Baghdad that only holds sway over a rump Iraq, which is essentially what it has accepted in Syria. The Quds Force battalions that were rushed into Iraq as ISIS swept through the Sunni Triangle were not deployed to Baghdad to blunt a Sunni offensive there, but rather to the Shi’a holy cities of Najaf and Karbala. Making these cities – and their holy sites and religious seminaries – dependent upon Iranian protection allows them to influence/intimidate the Najaf Marja, whose quietist theology of non-interference in politics challenges the ideology underpinning the ayatollahs’ theocratic rule in Iran. As always, the ayatollah’s greatest concern in Iraq is not maintaining its territorial integrity or defeating ISIS – which has been purposely left untouched by the Assad regime in Syria in order to justify their barbaric suppression of that country’s rebellion as a fight against extremism – but rather to keep Najaf’s religious institutions from threatening their threadbare legitimacy with the Iranian people.

Given that a favorite criticism by those who believe the Bush administration’s liberation of Iraq itself was the “original sin” that set in motion the forces that led to the present crisis has been that it handed Iraq to Iran, it is beyond ironic that many of these same voices now suggest working with Iranian forces in Iraq should be U.S. policy. But as they say, consistency is the hobgoblin of small minds . . .

In the end, there may be no “good” or easy options for the United States in Iraq. But as the course of Syria’s civil war demonstrates, international crises seldom self-correct to our benefit in the face of U.S. inaction. American indecision is far more likely to produce an even greater deterioration in the quality of our policy options.

Historians will sort through the causes of Iraq’s collapse and ISIS’s rise to power and apportion blame for this fiasco in due time. The threat ISIS’ gains in Iraq to U.S. national security are sufficient that it is imperative the Obama administration chooses a path now, rather than to cede initiative to an enemy that seeks to put America and its allies in its crosshairs.

Israel’s Defense Budget Dilemma Looks Familiar

June 3, 2014

By Benjamin Runkle, JINSA Director of Programs

I have begun to retype my notes from the recently completed Generals and Admirals Trip to Israel in preparation for drafting the trip report.

This year’s delegation participated in more than thirty briefings with senior Israeli political leaders and military commanders, to include Prime Minister Benjamin Netanyahu, Foreign Minister Avigdor Liberman, IDF Chief of Staff LTG Benny Gantz, the Chiefs of Staff of the Israeli Air Force and Navy, and the Commanders of Israel’s four regional commands. One recurring theme that came up in several of the meetings was one familiar to those of us who have been closely following debates about the U.S. defense budget over the past three years. Specifically, as Israel faces a greater diversity of operational threats and increasing regional instability, it also faces significant cuts to the IDF budget.

cutsAn op-ed by Amos Harel that appeared in Ha’aretz while the delegation was in Israel — and was passed from general officer to general officer on the bus while en route to Central Command headquarters — conveys Israel’s dilemma. Without commenting on Harel’s political analysis (i.e. his depiction of the IDF as having cried wolf in the past) I have to say that the parallels between the IDF’s budget crisis and that of the U.S. military (especially our Army) is striking. Just as LTG Gantz had to halt training exercises – the only flexible component in the IDF budget – in order to “close the budget gap,” budgetary pressures have forced the U.S. Army to raid its “readiness” accounts in order to produce immediate savings. In 2013 the Army cancelled six rotations at its premier training centers and limited 80 percent of its forces to basic home-base training at only the squad level or below. Whereas LTG Gantz complained about the government’s failure to approve the IDF’s multi-year plans, a common criticism of the 2011 Budget Control Act (a.k.a. “sequestration”) is that by mandating across-the-board cuts, the ensuing uncertainty prevents the Services from conducting effective long-range planning on issues such as weapons procurement and force structures.

Moreover, since the JINSA delegation’s return to the States, Defense News reports that Israel’s Defense Ministry has suspended planned procurement contracts, slowed work on major R&D projects, and warned of a wave of defense industry layoffs to come if the budget shortfalls persist. Interestingly, Israeli Treasury officials credit the Ministry of Defense (MoD) with improving efficiency “in its effort to squeeze more spending power from the non-fixed portion of its budget,” a goal that still generally eludes our Defense Department. However, Treasury still insists “that MoD could and should reform procedures governing the amount of money it spends on pensions and rehabilitation,” a statement that echoes the question of U.S. military personnel costs that was at the center of debate regarding last winter’s Ryan-Murray budget proposal.

These budgetary crises emerge from related corners of each country’s political landscape. In Israel, the success of deterrence and defensive measures since 2006, and the perception of Israel as an oasis of calm amidst the Middle East’s growing turmoil made possible the mass protests in 2011 that called for the prioritization of domestic over defense spending. In the United States, a decade of war has left the public weary of international entanglements and eager to conduct what President Obama termed “nation-building at home.” Indeed, there is no easy answer to the hard choices posed by the Scylla and Charybdis of increased threats to national security in the near-term and the long-term threat posed by America’s ballooning national debt.

I don’t know whether it is reassuring or disconcerting that our ally Israel faces a similar dilemma.

Regenerating Leverage in Nuclear Talks with Iran

May 21, 2014

By Jonathan Ruhe, JINSA Gemunder Center Senior Policy Analyst

As talks resumed last week in Vienna, significant differences remained between the United States and Iran on a comprehensive settlement over the latter’s nuclear program. This is unsurprising. First, there is minimal mutual interest on this issue. Tehran’s leaders have staked much of the regime’s credibility on their country’s self-proclaimed right to such a program. This is highly problematic for the United States, since ensuring Iran’s “right” could allow Tehran to retain the capability to develop enough fissile material for a nuclear device.

Second, productive diplomacy is severely hamstrung by the long history of distrust between the two sides. U.S. negotiators will want ironclad assurances Iran cannot cheat on a final deal, given its previous track record of deception over its nuclear activities. Meanwhile, Tehran has a tendency to view such intrusions as Trojan horses for subverting the Islamic Republic, especially on an issue as critical as the nuclear program. This calculus makes Iran unwilling to compromise if it has little to fear from the failure of negotiations.

Third, there is a worrisome imbalance of leverage at the negotiating table. Iran has been building economic and military leverage against the United States. This includes a refusal to discuss its ballistic missile programs as part of a final deal, despite their potential as delivery vehicles for nuclear warheads, and despite being subject to U.N. Security Council resolutions which it agreed to address in a comprehensive settlement.

Simultaneously the United States is doing nothing to address Iran’s rebounding crude oil exports. The interim deal over Iran’s nuclear program (the Joint Plan of Action [JPA], implemented January 20) paused relevant sanctions, but Iran’s exports during the interim quickly exceeded the agreed limit of 1 million barrel per day (mm b/d; chart reproduced from report by JINSA’s Gemunder Center Iran Task Force):

Graph1

Because oil export revenues are the lifeblood of the Iranian regime and its nuclear program, sanctions targeting these revenues helped push Tehran to the negotiating table in the run-up to the JPA. However, beyond the suspension of such measures, the Obama Administration has further tied the hands of U.S. negotiators by publicly refusing to countenance further sanctions on Iran’s oil exports, even though they would only enter into force if a final deal falls through. By reducing Iran’s fear of the failure of diplomacy, this inaction only feeds its unwillingness to compromise.

There are ways to begin rebuilding U.S. leverage heading into the final stretch of negotiations. (The JPA interim period ends July 20, though its six-month timeframe is renewable by mutual consent.) While political momentum for new sanctions stalled earlier this year, American policymakers could reinvigorate the public discussion of available options. The existence of such a debate – even if the Obama Administration does not join it – could improve the prospects for an acceptable final deal, by highlighting how failure to achieve one would be more costly for Tehran than for Washington.

Specifically, the United States should explain how the world can live without Iranian oil more readily than Iran can live without an acceptable final deal. A credible argument for the feasibility of this maximal form of non-military pressure could help convince Iranian negotiators to agree to a deal which their American counterparts could sell at home, even if doing so makes it more difficult to sell back in Tehran.

There is recent precedent for driving significant Iranian exports from the global oil market, as the above chart illustrates. Oil sanctions removed roughly 1.5 mm b/d of Iranian exports from the market between their announcement in early 2012 and the JPA being agreed in November 2013. This was offset by decreasing U.S. net oil imports (driven by rising North American output) and production growth from Gulf Arab states (many of whom are even more troubled than the United States by the prospect of a nuclear-capable Iran). Over this period, the 11 largest suppliers to the United States simply shifted most of their erstwhile U.S. exports to Iran’s customers.

The United States could make a strong case for driving the remainder of Iranian exports from the market if it is not satisfied with a potential final deal by July 20. Thanks to forecasted further decreases in U.S. net imports and expanding Gulf capacity, the Department of Energy (DOE) projects global spare production capacity will double by the end of 2015. This is crucial, as spare production capacity influences expectations of potential future disruptions, and thus the risk premium added to the price of oil. Generally speaking, spare capacity and risk premium are inversely proportional, as evidenced in the red (price) and blue (spare capacity) lines in the chart below.

Graph2

Using DOE forecasts as a baseline, removing all Iranian oil exports by July 20, 2015 (green line in chart), would merely slow the growth in projected global spare production capacity through the end of next year. All else being equal, this could be expected to have a negligible net effect on oil prices. By showing how the world can live without one thing Iran’s regime cannot, articulating an argument along these lines could help the United States regenerate crucial leverage for reaching an acceptable final deal on Iran’s nuclear program.

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