Iran nuclear deal: To preserve the euphoria, much needs to happen

Optimistic reactions to the Iran nuclear deal, such as higher prices for certain stocks and lower for oil, could sour quickly if Iran fails to follow through on the requirements it signed on to Sunday.

When shares in French automaker Peugeot jumped in European trading Monday, it was a direct result of the interim deal reached Sunday to curb Iran’s advancing nuclear program in exchange for some modest relief for Iran from international economic sanctions.

The economic measures in the deal include an easing of restrictions on automobiles, and Iranians have traditionally been big buyers of Peugeot cars.

Such business indicators – the price of crude oil also dropped Monday on news of the deal that will permit a limited rise in Iranian oil exports – are among the first signs of the impact of an agreement that is to last six months while world powers and Iran try to negotiate a comprehensive long-term nuclear accord.

But such optimistic reactions to the deal could sour quickly if Iran fails to follow through on the requirements it signed on to Sunday for curbing its nuclear program and for opening it to intrusive international inspection.

The interim accord is basically designed as a pause in Iran’s nuclear progress, to give negotiators for Iran and world powers the breathing space to pursue the far more difficult task of cementing a long-term deal that dismantles parts of a program that at this point has the key components for building a nuclear weapon.

As Secretary of State John Kerry said in announcing the interim deal that opens the door to negotiations on a “comprehensive” solution to Iran’s nuclear challenge, “The next phase will be even more difficult.” That is because negotiators will be looking to move beyond a suspension of Iran’s nuclear activities to a roll-back, and to dismantling of some facilities.

US officials like to say the interim accord puts time back on the clock that is counting down to Iranian nuclear weapons capability. But that extension of time on the nuclear clock requires a series of concrete steps – any one of which, if not accomplished by Iran, could doom prospects for a comprehensive agreement.

Both sides in the negotiations that culminated Sunday in the interim deal – Iran on one side, and six world powers including the United States on the other – signed on to a four-page “joint plan of action” that outlines the next steps each side will take while a “comprehensive solution” is negotiated.

The steps both sides have committed to are reversible: Iran could return to stockpiling enriched uranium and installing new uranium-spinning centrifuges, while the US and other powers could re-impose the sanctions they have suspended if the next rounds of talks go nowhere.

And some critics blast the interim deal for allowing Iran to continue some enrichment activities, albeit at newly restricted levels, and for leaving Iran with all the “bones” of a nuclear weapons program.

But other international security experts praise the deal for relieving international tensions and say the steps required of Iran are more onerous than critics suggest.

Saying the initial accord includes steps placing “significant limits on Iran’s nuclear program,” Anthony Cordesman of the Center for Strategic and International Studies (CSIS) in Washington also notes that the deal calls for “increased transparency and intrusive monitoring of [Iran’s] nuclear program.” 

Critics have also condemned the sanctions relief outlined in the interim plan as “too much for too little.” But Mr. Cordesman, writing on the CSIS website, calls the measures that the US and other world powers will take “limited, temporary, targeted, and reversible,” and emphasizes that “the overwhelming majority of the sanctions regime, including the key oil, banking, and financial sanctions architecture,” will remain in place.

Under the “first-step” plan agreed to Sunday, Iran commits to either converting or diluting its stockpile of 20 percent enriched uranium – a level of purity just a few short steps away from weapons-grade – so that it has “zero” left at the end of the six months.

Iran is allowed to keep its approximately 19,000 centrifuges, but it is forbidden from installing new centrifuges or from putting into operation the thousands of centrifuges it possesses but has not yet started up. While Iran is allowed to continue enriching uranium at the roughly 5 percent level required for nuclear energy purposes, it is not to have accumulated more such low-level enriched uranium at the end of the six-month period than it has now.

According to the plan of action, Iran will not “make any further advances” at its nuclear facilities. That includes the controversial heavy-water reactor at Arak, which upon completion would produce plutonium, another fuel for nuclear weapons.

And Iran also agreed to “daily IAEA inspector access” at key nuclear facilities – meaning doors are to be opened to the United Nations nuclear watchdog agency, the International Atomic Energy Agency.

The action plan states that “in return,” the US and the other world power including the European Union, agree to sanctions relief ranging from a “pause” in efforts to “further reduce Iran’s crude oil sales, to suspension of US an EU sanctions on Iran’s petrochemical exports as well as on transactions of gold and other precious metals.

Iran will also be allowed to repatriate some of its oil revenues held abroad. Restrictions on automobiles and sales of spare parts for Iranian civil aviation are to be lifted.

But these are all temporary or limited steps. The six months of negotiations those limited steps are supposed to facilitate will aim at finding the much more difficult long-term outcomes both sides seek: a rollback of Iran’s nuclear program to peaceful energy production on one side, and an end to all international sanctions on Iran’s economy on the other.

The glaring central issue the six months of talks will seek to resolve is what kind of enrichment program Iran will be left with under a comprehensive deal.

The “plan of action” makes it clear that the parties, including the US, foresee Iran retaining some level of enrichment capability. “This comprehensive solution would involve a mutually defined enrichment program with practical limits and transparency measures to ensure the peaceful nature of the program,” the text states.

The plan says that any enrichment program agreed to under a comprehensive accord should be limited to fulfilling Iran’s “practical needs.”

But Iran and world powers, the US and France among them, are likely to have very different – some predict insurmountable – visions of just what those “practical needs” are.

 And that is not even taking into account the even tougher views of critics in the region and in the US Congress, some of whom are already promising efforts to sabotage any long-term agreement that bestows an international blessing on Iranian uranium enrichment.