Where Are Nuclear Negotiations In Iran Headed?

Editor's Note: Below is a complimentary research note written by National Security analyst LTG Dan Christman. To access our Macro Policy research please email sales@hedgeye.com.

           

The oft-quoted title of General Dave Petraeus’ 2009 book written about Iraq, “Tell Me How This Ends” rings with special resonance now about Iran and the lengthening global tension over its nuclear program.

With a new hard-line Iranian government, a foreign minister described as the “Qassem Suleimani of diplomacy,” and a likely much more abrasive negotiating team than the one that finalized the 2015 nuclear deal (”JCPOA”), it’s far from clear where nuclear negotiations are heading.

Further, remarks from the Biden Administration over just the last few weeks raise questions about whether the White House still believes that a return to the JCPOA remains in our strategic interests.

Secretary of State Antony Blinken for example earlier this month commented, “We are getting closer to the point at which a strict return to compliance with the JCPOA does not reproduce the benefits that agreement achieved.”  

So, what is the “bottom line, upfront?”

With the Iranian foreign ministry last week indicating an intention to start talks again “in the new future,” the best guess remains that we’ll see, perhaps by this winter, a return to a rough equivalent of the original 2015 deal.

The P5 +1 parties (U.S., UK, France, Russia, China plus Germany) will likely cobble together a package of sanctions relief and renewed constraints on Iran’s nuclear program the might best be described as a “skinny” deal — no expansion of the original JCPOA to include ballistic missiles, for example; no extensions of the “sunset” provisions that constrain Iran's centrifuges; and certainly no limits on Iran's support regionally for malign actors throughout the so-called “Shia-Crescent."

But the reality is that, by later this decade, once many of the nuclear constraints expire or “sunset,” Iran will become a latent nuclear power — as analysts describe it, “one screwdriver's turn away from becoming a nuclear weapons state.” 

Iran’s new president Ibrahim Raisi will likely by then have become Iran’s Supreme Leader following the death of Ali Khamenei.

Raisi will not risk international capital flows by rolling out a suite of nuclear-tipped ballistic missiles; but research, development and testing will continue, especially on missiles and warhead designs.

In the meantime, as Iran inches closer to full weapons capability, the U.S. and Israel will continue their covert efforts to sabotage and disrupt Iran’s program.

This “danse a trois” will likely not mean an all-out military attack on Iran’s nuclear infrastructure; but it does guarantee years of tension short of war in the Gulf, tension that keeps a U.S. military presence in the region despite a White House desire to exit — regardless of who may be the White House occupant.   

The Bottom Line is not encouraging. There will be no “End” as long as Iran remains a theocratic state.

But what can make this Iran scenario even more worrisome would be failure by the current president to properly attend to two related issues: U.S.-Israel relations; and unity with our Western European allies.

Both sets of relationships bear directly on keeping Iran from joining the nuclear weapons club.

President Joe Biden appears to have taken important, encouraging steps with new Israeli PM Naftali Bennett; but he has badly misstepped with key European friends Germany and France. 

U.S.-Israel: as I wrote two weeks ago, the recent visit by Bennett and his meetings with Biden and Biden's team were productive: far fewer histrionics than with Bibi, but with many of the same Israeli international goals (“Netanyahu without Netanyahu-ism,” as some have described Bennett).

Bennett had to have come away encouraged with Biden’s acceptance of “creativity” to thwart Iran's nuclear ambitions if diplomacy fails; and Biden must have breathed some relief when Israeli Defense Minister Benny Gantz said last week that “the current U.S. approach, putting Iran's nuclear program back in a box, I can accept that!” Biden wants Bennett to succeed, and the president and his team pulled out the stops to try to make that happen.

The opposite was the case over the last three weeks with European allies Germany and France. It bears repeating that both are members of the P5+1 team negotiating with Iran, and each is a key influencer with Tehran.

But it's hard to exaggerate the antipathy both now feel toward the White House: Germany over the abrupt Afghanistan pull-out and what they view as inadequate consultation; and France over the U.S.-UK submarine deal with Australia and the roll-out of the “AUKUS” (Australia/UK/US) strategic partnership that pointedly excludes France.

“Allies don’t treat each other with such brutality” were the pained words of the French Foreign Minister.  "Working with Allies" is supposed to be Biden's leadership strong suit; if he wants to put Iran's nuclear program back in the box — and increase deterrence with the PRC - he needs to make amends with both Berlin and Paris ASAP, steps that go beyond phone calls.    

Projecting five or ten years ahead regarding Iran and developments in the Persian Gulf has always been a risky bet.

There is a chance, for example, that the mullah-inspired, Revolutionary Guard-controlled theocracy that is modern-day Iran crumbles. The likelihood is thin, but not zero.

Or there’s the possibility that a new Supreme Leader forsakes the pledge of Khamenei not to field nuclear weapons, in which case we face a shooting war. In the roughly seventy years of our involvement with Iran, equally dramatic outcomes have undermined confident predictions. 

But going forward, a return to the original JCPOA - no more - followed by years of tension as each side tests the resolve of the other seems the surest bet.

U.S. business will not be flocking to Iran; but at the same time they won’t be deterred in looking for opportunities in the larger Persian Gulf region as the Abraham Accords between Israel, the UAE, and Bahrain mature — and are hopefully broadened to include other countries. 

With new leadership in Iran, Israel and the U.S., one might expect a surprise move toward, or even an attempt at, regional reconciliation. But that's one bet I wouldn’t recommend taking.