News / Middle East

West Considers Early Sanctions Moves in Troubled Iran Nuclear Talks

Iran's Foreign Minister Mohammad Javad Zarif (L) meets with U.S. Secretary of State John Kerry (R) at talks between the foreign ministers of the six powers negotiating with Tehran on its nuclear program in Vienna, Austria, July 13, 2014.
Iran's Foreign Minister Mohammad Javad Zarif (L) meets with U.S. Secretary of State John Kerry (R) at talks between the foreign ministers of the six powers negotiating with Tehran on its nuclear program in Vienna, Austria, July 13, 2014.
Reuters

With talks between world powers and Iran over a broad nuclear accord at an impasse, Western governments are considering offering a significant easing of sanctions early on in the process to try to wring concessions from Tehran, diplomats say.

To be effective, such a plan would have to involve clear guidance to companies made wary by U.S. fines for sanctions-busting, be reversible and not go too far, or skeptical U.S. lawmakers would simply reimpose restrictions.

The OPEC oil producer has seen its economy devastated by years of sanctions imposed over its contested nuclear program, which Western states say appears to be aimed at producing a nuclear bomb and Tehran says is purely peaceful.

The prospects for an immediate accord scaling back that program in return for sanctions relief appeared tenuous on Thursday. Diplomats said the six world powers negotiating with Iran - the United States, Russia, China, France, Britain and Germany - were working out terms for an extension of talks, beyond their self-imposed July 20 deadline, instead of seeking to close a deal now.

If there is an agreement in the coming weeks or months, Western diplomats have told Reuters, Iran might still have to wait years, or as long as two decades, to see the complex web of sanctions permanently removed.

Instead, they said, Western states may opt for a patchwork of steps suspending sanctions in various industries that can be easily reinstated if Tehran reneges on its nuclear commitments. The extent of these steps would match Iranian concessions.

“When Iran does something, then we can respond with sanctions relief,” one said, speaking on condition of anonymity. “The whole process will take years.”

The timing of any easing of oil sanctions - closely watched by the markets -  which now prohibit U.S. and European importers from buying Iranian crude and impose severe restrictions on third country purchases, will depend on what Iran offers to do from its side and when.

But some diplomats said restrictions on banking with Iran might have to be eased in step with other industries, such as shipping for example, to make sure companies can finance any newly re-established trade.

“We can be flexible,” a senior western diplomat said.

Without access to finance, relief might not materialize, raising questions about the world powers' credibility and endangering the implementation of the accord, they said.

Western companies are eager to enter Iran, a market of nearly 80 million people and vast oil reserves.

But banks have been reluctant to process cash when it became admissible to a certain extent under an interim accord struck between Iran and the world powers last November, which provided modest sanctions relief for some nuclear concessions.

Some experts have said overcoming this reluctance may mean, for example, that the West would have to name several banks that would process transactions allowed under newly allowed relief.

“Overcoming the reticence of international banks to do business with Iran will require the [six powers] to issue clear regulatory guidance about which multilateral sanctions are lifted,” said Elizabeth Rosenberg from the Center for a New American Security in a research note.

French bank BNP Paribas agreed earlier this month to pay $9 billion for contravening U.S. sanctions, also against Iran, in a move likely to increase western banks' reluctance to open up for business with Tehran.

The right timing

How sanctions relief for Iran is introduced might be a crucial factor in ensuring the integrity of any deal, which will likely be implemented over many years.

The West wants Iran to scale back its atom work so much that it would take it a long time, maybe years, to assemble materials for a bomb. To achieve that it wants Iran to limit its capacity to enrich uranium to bomb-grade and subject any remaining work to strict United Nations oversight.

For now, diplomats said, the sides have struggled to match Iranian and western concessions sufficiently to craft a deal, despite holding six rounds of talks since the start of this year coordinated by the EU's top diplomat Catherine Ashton.

Some diplomats have said that as a goodwill gesture towards Iran, the West would be willing to “front-load” some sanctions relief, in return for quick stepping back from atom work.

“It's all meant to be reciprocal,” one diplomat from the six powers said.

But experts warn that Congress, where Republicans and some Democrats have called for talks to be abandoned and a return to tough sanctions to deter Tehran from building an atom bomb, may move ahead with new sanctions if they view a deal as too lax.

“If they try to front-load relief too significantly or lift key elements [of the western sanctions architecture] too precipitously, they will inspire a congressional backlash,” said Mark Dubowitz of the Foundation for Defense of Democracies, a U.S. think-tank which advocates tougher sanctions.

Political complications

Any sanctions relief would have to be closely coordinated between the United States and Europe, some diplomats also said, to ensure Washington's power to punish third countries for contravening its restrictions does not complicate implementation.

It would be difficult, for example, for the Belgium-based SWIFT, which provides banks with a system for moving funds around the world to unblock Iranian banks from using its network to transfer money without some easing of U.S. restrictions.

The Belgian company cut off Iranian banks in 2012 as part of a wider international push to ratchet up sanctions that also included a European Union embargo on purchases of Iranian oil.

The once unthinkable move - considering the extent of dependence of some European countries on Iranian crude -  pulled between 450,000 and 600,000 barrels per day off world markets and made it very difficult for global buyers of Iranian crude to insure shipments.

One western diplomat said Iran's immediate goal was to roll back sanctions to what they were prior to EU moves in 2012.

If that happens, EU rules would only allow for the oil embargo to be initially suspended before permanent removal.

A suspension could be easily reversed, while to reimpose such a ban, which took months of painstaking negotiations in 2011 to agree, might be impossible again because it would require a unanimous decision by all 28 EU governments.

In Washington, Obama can theoretically use waivers to allow for some previously sanctioned trade. But a permanent removal of sanctions in many industries would require congressional support, which might be impossible to secure before Iran has completed its side of the deal.

Several diplomats said much of the extensive western sanctions architecture could remain in place even after an accord is concluded.

Many U.S. measures pre-date the nuclear conflict and are related to tensions between Washington and Tehran over a hostage crisis following the 1979 Islamic Revolution.

The domestic U.S. oil embargo would be one example, even if Washington gradually removes pressure on third states not to buy Iranian oil.    

You May Like

Video Iran Nuclear Deal Becomes US Campaign Issue

Voters in three crucial battleground states - Florida, Ohio and Pennsylvania - overwhelmingly oppose nuclear deal with Iran More

With IS in Coalition Cross-Hairs, al-Qaida's Syria Affiliate Reemerges

Jabhat al-Nusra has rebounded, increasingly casting itself as a critical player in battle for Syria’s future More

Lessons Learned From Katrina, 10 Years Later

FEMA chief Craig Fugate says key changes include better preparation, improved coordination among state, federal assistance agencies More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Colombians Flee Venezuela as Border Crisis Escalatesi
X
August 27, 2015 2:08 AM
Hundreds of Colombians have fled Venezuela since last week, amid an escalating border crisis between the two countries. Last week, Venezuelan President Nicolas Maduro ordered the closure of a key border crossing after smugglers injured three Venezuelan soldiers and a civilian. The president also ordered the deportation of Colombians who are in Venezuela illegally. Zlatica Hoke reports.
Video

Video Colombians Flee Venezuela as Border Crisis Escalates

Hundreds of Colombians have fled Venezuela since last week, amid an escalating border crisis between the two countries. Last week, Venezuelan President Nicolas Maduro ordered the closure of a key border crossing after smugglers injured three Venezuelan soldiers and a civilian. The president also ordered the deportation of Colombians who are in Venezuela illegally. Zlatica Hoke reports.
Video

Video Is China's Economic Data Accurate?

Some investors say China's wild stock market gyrations have been made worse by worries about the reliability of that nation's economic data. And some critics say the reports can mislead investors by painting an unrealistically-strong picture of the economy. A key China scholar says Beijing is not fudging ((manipulating)) the numbers, but that the economy is evolving quickly from smoke-stack industries to services, and the ways of tracking new economic activity are falling behind the change. V
Video

Video Next to Iran, Climate at Forefront of Obama Agenda

President Barack Obama this week announced new initiatives aimed at making it easier for Americans to access renewable energy sources such as solar and wind. Obama is not slowing down when it comes to pushing through climate change measures, an issue he says is the greatest threat to the country’s national security. VOA correspondent Aru Pande has more from the White House.
Video

Video Shipping Containers Provide Experimental Housing

Housing prices around the San Francisco Bay area are out of reach for many people, so some young entrepreneurs, artists and tech industry workers are creating their own houses using converted shipping containers. But as VOA's Mike O’Sullivan reports from Oakland, the effort requires ingenuity and dealing with restrictive local laws.
Video

Video Arctic Draws International Competition for Oil

A new geopolitical “Great Game” is underway in earth’s northernmost region, the Arctic, where Russia has claimed a large area for resource development and President Barack Obama recently approved Shell Oil Company’s test-drilling project in an area under U.S. control. Greg Flakus reports.
Video

Video Philippine Maritime Police: Chinese Fishermen a Threat to Country’s Security

China and the Philippines both claim maritime rights in the South China Sea.  That includes the right to fish in those waters. Jason Strother reports on how the Philippines is catching Chinese nationals it says are illegal poachers. He has the story from Palawan province.
Video

Video Technique May Eliminate Drill-and-Fill Dental Care

Many people dread visiting dentists because they're afraid of drills. Now, however, a technology developed by a British firm promises to eliminate the need for mechanical cleaning of dental cavities by speeding a natural process of tooth repair. VOA’s George Putic reports.
Video

Video China's Spratly Island Building Said to Light Up the Night 'Like A City'

Southeast Asian countries claim China has illegally seized territory in the Spratly islands. It is especially a concern for a Philippine mayor who says Beijing is occupying parts of his municipality. Jason Strother reports from the capital of Palawan province, Puerto Princesa.
Video

Video Ages-old Ice Reveals Secrets of Climate Change

Ice caps don't just exist at the world's poles. There are also tropical ice caps, and the largest sits atop the Peruvian Andes - but it is melting, quickly, and may be gone within the next 20 years. George Putic reports scientists are now rushing to take samples to get at the valuable information about climate change locked in the ice.
Video

Video French Experiment in Integrating Roma Under Threat

Plans to destroy France’s oldest slum have sparked an outcry on the part of its Roma residents. As Lisa Bryant reports from the Paris suburb of La Courneuve, rights groups argue the community is a fledgling experiment on integrating Roma who are often outcasts in many parts of Europe.
Video

Video Kenyans Turn to Agriculture for Business

Each year Kenyan universities continue to churn out graduates for the job market despite the already existing high rate of unemployment among youth in the country. Some of these young men and women have realized that agriculture can be as rewarding as any other business or job, and they are resorting to agribusiness in large numbers as a way of tackling unemployment. Rael Ombuor reports for VOA.
Video

Video First Women Graduate Elite Army Ranger School

Two women are making history for the U.S. Army by proving they are among the toughest of the tough. VOA's Carla Babb reports from Fort Benning, Georgia as 94 men and those two women rise as graduates of the difficult Ranger school.

VOA Blogs