Market Monitor

The US-Iran conflict: no sign of a way out

Iran’s limited use of violence in the Gulf has caused US President Donald Trump to adopt a more cautious posture towards Tehran. However, conflict is likely to erupt again as long as the economic sanctions remain in place. Iran has begun violating the Joint Comprehensive Plan of Action (JCPOA), with the aim of pressuring the international community to break the blockade and may even be willing to risk a “limited” conflict. In the US, while the prospect of elections in 2020 is likely prevent the Trump administration from hardening its stance in the short run, if it wins a second term and Iran continues its provocations, the anti-Iran hawks in the Cabinet will have maximum flexibility to make the case for military action.

 

Iran banking on Trump’s lack of appetite for war, hopes to win backing for reinstatement of oil waivers 

In light of the recent escalating tensions in the Gulf, it is possible that Iran would risk a contained war in order to maintain unity at home and motivate the world community to force the US to meet Iran’s minimum requirement for negotiations: the reinstatement of oil import waivers.

What this assumes is that the US’ Iran policy is coherent with a common objective. Trump was keen to demonstrate his toughness on Iran by withdrawing from the JCPOA, his predecessor’s signature foreign policy achievement.  But in recent months he has softened his stance: his calling off of a military strike in June in response to Iran’s downing of a US drone was a clear sign that he is not prepared to start a war – at least not before the 2020 elections – and would prefer instead to expand sanctions, even though he has run out of new targets.

However, his hawkish National Security Advisor John Bolton and Secretary of State Mike Pompeo support the more aggressive approach on Iran promoted by Israel’s Prime Minister Benjamin Netanyahu and hope continued provocation will motivate Trump to change his position.

Indeed, the probability of Iran escalating tensions in the Gulf is high, if not certain: Its attacks on oil tankers and other oil facilities, and the destruction of a US spy drone, were designed to get the world’s attention and exploit the divisions in the White House. In this it succeeded: the tactic of “pinpricks” did not lead to a major conflagration. It is now creating the next crisis by wilfully violating limits on the stockpiling of enriched uranium and heavy water, and gradually increasing the level of enrichment to just under 5%.

That has placed Iran in direct conflict with all the signatories of the JCPOA even though they understand that the US initiated the crisis. The UK’s illegal seizure of an Iranian tanker and Iran’s actions against British shipping in the Gulf widens the conflict.[1] By September 2019 Tehran has threatened to go back to 20% enrichment, taking it closer to levels needed for weaponization. The leadership’s calculation is that the threat of an Iranian bomb is the only way to get the international community’s attention.

 

Provocations by Tehran shoring up support at home

Other factors are motivating Iran to be more aggressive even though it has traditionally preferred asymmetric warfare than direct confrontation or provocation. The regime has been greatly strengthened by its recent victory.  Particularly for the hardliners, and specifically for the Islamic Revolutionary Guard Corps, appealing to Iranian nationalism by showing it is defending the country against a foreign aggressor is a win-win proposition.

 

Trump’s restrained response to Iran’s actions due to 2020 US Elections

From the US’s side, Trump’s hesitation to retaliate against Iran had everything to do with the upcoming elections, which top any policy objective he may have. His media guides, notably at the Fox News channel, warned that another Middle Eastern war would lead to a global economic crisis and potentially reduce support from his core electoral base.

Some journalists have speculated that Trump has become estranged from Bolton, citing Ivanka Trump’s prominence at the recent G-20 meeting in Japan and Bolton’s absence when Trump crossed over into North Korea to meet Kim Jong Un. His call for talks with Iran has also heightened fears in Israel that Trump will settle for a weak nuclear “Agreement 2.0,” with few differences from the JCPOA (as he did when NAFTA was transformed into the United States-Mexico-Canada Agreement, or USMCA.)

Bowing to re-election concerns of the White House, the anti-Iran hawks will likely wait to step up aggressions with Iran until after the elections, when the administration – if it wins – will have maximum flexibility. They have adopted a public posture that the Iranian regime will collapse due to sanctions and its own contradictions. Even if Tehran accedes to real talks with the US, in the short run this could provide the hawks with an opportunity to show they have gone the extra mile. They could set a trap for Iran by demanding that it meet the 12 conditions set out by Pompeo in 2018, which it is sure to reject.

In the meantime, they, the Israelis and the Trump’s Gulf allies are working on tightening the noose further around the Iranians. Statements after the meeting of the three national security advisors of Russia, Israel and the US in Jerusalem at the end of June hinted at some common objective of squeezing Iran out of Syria, thereby putting another constraint on its strategic and security space. Pompeo also toured the Gulf to coordinate a more concerted effort to attack Iranian “assets” in Iraq and Lebanon, and protect shipping in the Gulf. Plus, Israel continued its bombing of Iranian bases in Syria.

 

Trump’s offer to talk is not an “off-ramp” for Iran or the US

Iran is demanding a lifting of sanctions prior to talks. For Tehran, going to the negotiating table without sanctions lifted would appear to be an embarrassing capitulation to US pressure. This is particularly dangerous for the Rouhani administration, which has been accused by hardliners in the regime of failing to deliver on its economic promises following the signing of the JCPOA with a much more flexible US administration. Trump’s government is unlikely to afford Iran much wiggle room as it sees sanctions as a necessary means to achieve Pompeo’s 12 conditions.

There are at present a number of third-party attempts to bring both sides to the table but clashing motivations reduce the likelihood of talks. If these attempts fail, there are few options left for the Iranians seeking relief from sanctions, and Trump may be compelled by Iran and his hawkish Cabinet to revert to the military option.


Source:

[1] https://lobelog.com/the-strange-case-of-the-grace-is-detention/

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