The Nuclear Paradox of the Regime and the Dying JCPOA

As Europe delays the implementation of the Special Purpose Vehicle (SPV), the patience of the Islamic Republic's officials is also running out. Last week, Mohammad Javad Zarif, Abbas Araghchi, and Ali Akbar Salehi issued multiple warnings that Iran's tolerance is not unlimited. Zarif explicitly addressed Europe, stating that they must pay the price for their security considerations, and according to him, one cannot enter the water without getting wet. In recent statements, Araghchi has stated: 'The re-imposition of U.S. sanctions has brought Iran's benefits from the JCPOA close to zero. The balance of 'give and take' in the JCPOA has been lost... If Iran does not benefit from the JCPOA, this agreement will not survive... The establishment of a European financial mechanism for the continuation of JCPOA cooperation is a necessity.' Salehi, the head of Iran's Atomic Energy Organization, has also warned that 'not benefiting from the JCPOA will have dire consequences.' The reaction of European officials to these warnings is still unknown, but the Wall Street Journal has reported: 'European countries intend to prevent direct sanctions on the special financial channel with Iran by directly transferring ownership of this structure to the participating European governments... Diplomats say France and Germany are set to host an entity responsible for facilitating financial transactions with Iran.' Six months have passed since the U.S. withdrawal from the JCPOA and one month since the re-imposition of pre-JCPOA unilateral sanctions by the U.S. However, the granting of a six-month exemption to major oil and gas customers of Iran has prevented the 'maximum pressure' sought by the U.S. government from taking full effect, giving the regime an opportunity to plan to neutralize them. Meeting expectations from Europe is at the core of the regime's response for resistance. Therefore, recent positions can be seen at least in the short term as creating pressure to expedite European supportive activities for the JCPOA. However, the sensitivity of the situation and the significant gap between the promises and actions of the European Union have placed the half-alive JCPOA on the path to death, and the likelihood that 2018 will mark the end of Iran's nuclear agreement with global powers is not low. Assessments show that Russia and China alone cannot guarantee the survival of the JCPOA and the minimum expectations of the Islamic Republic. Europe is aware of the fragility of the situation and its role, and it can be said with a high degree of certainty that they have the will and desire to preserve the JCPOA, but their capacity is increasingly in doubt. The rejection of hosting the special financial channel with Iran by the governments of Austria and Luxembourg has increased despair and skepticism. The balance of power within Iran's power bloc has also shifted in favor of the hardliners who have always viewed Europe's capabilities with suspicion, and from this perspective, Rouhani's government is also under internal pressure. Europe has specific interests in the continuation of the JCPOA. Security considerations and subsequently the use of the Iranian market are key elements. Increasing tensions in the Middle East exacerbate Europe's vulnerabilities, especially concerns about a rising wave of migration. In addition, defending Europe's credibility in international relations and resisting the unilateral imposition of U.S. views is also a significant motivation in the behavior of the European Union. In this framework, in the 12-point statement of the meeting of foreign ministers of Iran and the 1+4 in New York, European officials emphasized their commitment to guarantee payment channels with Iran and the continuation of oil and gas condensate exports, as well as petrochemical products. Based on this new agreement, the Iranian government expects that the problems of oil sales and access to foreign banking resources will be reasonably resolved through maintaining trade and economic relations with Europe despite the unilateral U.S. sanctions. The U.S. government, aware of the impact of this development, has increased its pressure on European companies, and Brian Hook, the U.S. representative, is traveling from country to country to ensure that his government's sanctions expectations against the Iranian regime are met satisfactorily. However, the main problem remains the implementation of the special mechanism and persuading European companies, which, given the negligible share of trade with Iran compared to the U.S., is a challenging task. Europe, at best, cannot satisfy large companies to conduct business with Iran. Only medium-sized companies that are not present in the U.S. market can potentially be the target community. It seems that decision-makers in the Islamic Republic are also aware of this issue and do not have maximum expectations from Europe. Circumventing sanctions makes having a reliable channel with Europe essential, and this reality has led the leadership and dominant power sector to remain within the JCPOA. They know that Europe cannot eliminate all sanctions obstacles, but it can significantly assist in selling part of its oil and gas production and establishing limited banking and financial communications. At the same time, it should be noted that this patience and expectation is not permanent, and once complete despair sets in, they will have no justification for remaining in the JCPOA. Hassan Rouhani, unlike during his first presidential term, is now aligned and coordinated with the Guardian Council on this issue. Therefore, Europe does not have much time left. It is unlikely that the Islamic Republic will maintain its nuclear activities at the agreed level in the JCPOA in the new year if minimal European promises are not fulfilled. Analyzing and deciphering the positions of senior negotiators with the 5+1 does not clarify what the regime's plan for exiting the JCPOA is. Also, the certainty of this in case of European failure is not clear. Current warnings may, if not met with an appropriate response, turn into small but incremental steps in the development of uranium enrichment activities so that Europe becomes concretely aware of the regime's seriousness and takes the desired practical actions. Khamenei's nuclear command from a few months ago, which is of course not outside the framework of the JCPOA, could mark the beginning of the regime's threats and a gradual exit from the JCPOA. However, in the meantime, the positioning of government officials appears paradoxical. Their warnings about increased security costs in the event of the JCPOA's death contradict the regime's claims throughout its nuclear activity. The Islamic Republic has always claimed that its nuclear program is solely for meeting energy needs, agricultural development, and medical services, and its uses are entirely peaceful, with no military or security objectives in mind. However, the West and even Russia have not accepted this claim. Now, government officials, especially state officials, acknowledge that the nuclear program, in its full aspect, serves as leverage for the regime's security and strategic expectations to stabilize its position in the fragile regional and international balance of power. The threat of severe consequences from returning the nuclear program to pre-JCPOA dimensions confirms the positions of the governments of Israel, the U.S., and Saudi Arabia, which argue that the Islamic Republic seeks to destabilize the Middle East through the development of nuclear capabilities and achieving thresholds of sensitive nuclear activities. Even if the regime's officials aim solely for a psychological campaign to create pressure, they have still chosen a wrong path that will yield counterproductive results. Assuming Europe cannot meet the regime's demands, the Islamic Republic will need to demonstrate negative security consequences in practice. The high cost of the Islamic Republic achieving military nuclear capabilities or increasing dual-use nuclear fuel production will not allow these goals to be realized. The regime's leadership is well aware of the dangers, especially during Donald Trump's presidency. Therefore, the practical translation of the regime's warnings could manifest in escalating regional conflicts and proxy wars in Iraq, Syria, and Yemen, or in the indirect targeting of U.S. military facilities and bases in the Middle East, as commanders of the IRGC have suggested in recent days. However, the costs of these actions, in the context of a volatile region and a deteriorating economic situation within the country, create uncalculated risks. Most importantly, such events will increase security sensitivities and the European Union's opposition to the Islamic Republic's regional policies, leading the majority of European countries to abandon de-escalation with the Islamic Republic and resort to pressure and containment policies aligned with the U.S. Therefore, examining the above considerations strengthens the hypothesis that the regime's warnings lack the necessary backing and will be more problematic. Currently, the regime's agenda involves a showdown with the aggressive U.S. government, resisting until the end of Trump's presidency, and counting on his defeat in the 2020 U.S. presidential election, the success of which is seriously in doubt. However, exiting the JCPOA and approaching Israel's red lines does not aid these policies and, on the contrary, significantly reduces the rift between Europe and the U.S. regarding the JCPOA. The views expressed in this note do not reflect the views of Radio Farda. Ali Afshari is a political analyst and human rights activist residing in the U.S.