Can a New U.S.–Iran Nuclear Deal Hold Any Real Weight?

It was first-term U.S. President Donald Trump who ordered the 8 May 2018 unilateral withdrawal of his country from the ‘nuclear deal’ (the Joint Comprehensive Plan of Action, JCPOA) with Iran. He believed, with some justification according to several U.S. and Iranian sources spoken to at the time by OilPrice.com, that Iran was simply taking the benefits of reduced sanctions on it while giving away little in its nuclear programme and other activities that the deal was supposed to prevent. It is now second-term President Trump who last week said he that Iran has “sort of” agreed to the terms of a new nuclear deal with the U.S, although no further details were given at that point. In reality, the same Iranian sources who work closely with the country’s political and petroleum ministry hierarchy exclusively told OilPrice.com over the weekend, several major issues remain to be resolved from Iran’s side, although they believe Trump’s threats that military action that could be taken if Iran does not agree to a new nuclear deal. Given this, the most likely outcome of the ongoing U.S.-Iran negotiations is that Tehran will sign a deal that features any meaningful sanctions relief for it but will slow track the implementation of any actions on key issues for it for as long as possible, according to a senior source in the European Union’s (E.U.) energy security complex exclusively spoken to by OilPrice.com late last week.

Crucially from the U.S. side, one of these is not to do with uranium enrichment – either the level to which the product is enriched, or the amount of product it has enriched to higher levels. “For a long time early on, Iran talked up the scope of its nuclear enrichment programme in the hope of trading off a downscaling of this for relief from sanctions that had been put into place at various points following the [1979 Islamic] Revolution but which pre-dated its supposed move into developing nuclear weapons, and it worked,” said the E.U. source. “The IRGC [Islamic Revolutionary Guards Corps] then pushed the idea further and genuinely began to build out elements that were in line with the development of nuclear material that might be used in weapons, but which could in any event be used for nuclear energy purposes,” he added. “But right now, the [Iranian] economy is in such a bad state that it is the primary focus, not the level of uranium enrichment achieved nor the amount of the material that Iran wants in its stockpiles,” he underlined. “The [Iranian] rial is continuing to collapse and could weaken to 150,000 against [U.S.] dollar this year, with hyperinflation to follow, and this all reduces the ability of the IRGC to do safeguard the Revolution at home and to spread its [Iran’s] version of Islam abroad wherever it can,” he told OilPrice.com. “A lot of money is needed to rebuild its proxy foreign networks after the damage done to Hamas, Hezbollah, the Houthis and so on, and they do not want to be paid in rials,” he added.

The good news for Iran is that the level of uranium enrichment is precisely what the U.S. is focused on, and its primary ally in the Middle East, Israel. Israel has made it clear to Washington that if some agreement with Iran is not reached then it will take matters into its own hands, with direct strikes against Iran’s key nuclear facilities, as analysed recently by OilPrice.com. Following the U.S.’s withdrawal in 2018 from the original JCPOA that was finalised on 14 July 2015, Israel had become increasingly sure that Iran was no longer ‘years’ away from being able to create a nuclear weapon but rather just ‘weeks’ away, as analysed in full in my latest book on the new global oil market order. At the same time, Iran’s chief strategy to get some sort of deal back in place – to have sanctions reduced and thus further empower the IRGC – was to keep enriching uranium beyond the previous JCPOA agreed limit of just 3.67%. Tehran knew that this would cause consternation in Israel and that Tel Aviv would bring pressure on the U.S. to do something to redress the continued increases in enrichment. Iranian uranium enrichment then went past 20%, then 60%, and possibly then 80%+ too.

“What’s going to happen here we [the E.U.] think is that Iran is going to make a big show of allowing itself to be hammered down on the nuclear issue by U.S. negotiators in exchange for increasingly large relief from sanctions,” the E.U. source said last week. Indeed, already Ali Shamkhani, an adviser to Supreme Leader Ayatollah Ali Khamenei, has said that Iran would commit to never making nuclear weapons — a key clause of the original hardline JCPOA devised under former President Barack Obama and resuscitated in President Trump’s JCPOA terms, as also detailed in my latest book. He added that the country would also scrap its stockpiles of highly enriched uranium, agree to enrich uranium only to the lower levels needed for civilian use and allow international inspectors to supervise the process, as also in the original JCPOA clauses. “Iran’s starting point was to keep the enrichment level at or below 60% but it is likely to agree to levels far lower than this,” said the E.U. source. “Five percent is the sort of level needed for civilian nuclear purposes, and we have no doubt that they [the Iranians] will ultimately agree to that, although what they do in practice is another matter,” he added.

It may well be that this process of Iran being apparently begrudgingly being negotiated down takes less time than many might imagine. The reason for this – aside from economic necessity – is that there is a deadline of 18 October by which ‘snapback sanctions’ on Iran can be reimposed on Iran by the European members of the P5-plus-1 Group (the U.K., and France ‘plus’ Germany). These comprise a comprehensive range of UN Security Council sanctions that were lifted from the Iranian economy when the 2015 JCPOA was signed. These would include multiple new financial sanctions on companies and individuals and increased surveillance by the Financial Action Task Force (FATF). The FATF has 40 active criteria and mechanisms in place to prevent money laundering — an activity that is vital to the IRGC’s activities across the world. It also has nine criteria and mechanisms in place to do the same for the financing of terrorism and related activities — again, a core of the IRGC’s role in promoting Iran’s brand of Islam around the globe. The FATF also has swingeing powers to wield against individuals, companies, or countries who transgress any of its standards and is extremely aggressive in using them by degrees, depending on whether the sanctioned entity is on its ‘grey’ or ‘black’ list.

For its part, the E.U. is increasingly determined to impose the snapback sanctions before the 18 October deadline for two main reasons. “More information keeps coming in about the increased number of Russian nuclear scientists sent to Iran between June 2024 and February 2025 and the three top missile experts from Pyongyang who have been in Iran for 140 days or so,” said the senior E.U. security source. “We are told that the progress on weaponisation know-how has been expedited to critical levels,” he underlined. “Additionally, verified reports show that Iran is becoming ever more active in the Russia-Belarus campaign of eroding NATO’s eastern flank defences particularly along the vulnerable northern and southern border defences that are most vulnerable,” he said. “In the last delivery of mid- and long-range missiles from Tehran to Moscow, for the first time the IRGC included as they had promised in February in a meeting a visit to Moscow, Etemad [a late generation ballistic missile], and Fath 360 [a multi-lunch ballistic missile launching system], with most of the latter to be positioned by Moscow near the Belarus border with Poland,” he underlined. “Tehran believes that by signing an agreement with the United States, the E.U. will become toothless in their attempt to force new sanctions and additional inspections on them,” he concluded.

By Simon Watkins for Oilprice.com

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