Major world powers make last ditch effort to save Iran nuclear deal

Top diplomats from Iran and five world powers are meeting today in Vienna in a desperate attempt to save the 2015 nuclear deal following the withdrawal of the United States. The foreign ministers of Britain, China, France, Germany and Russia are due to meet with their Iranian counterpart Mohammad Javad Zarif for the first time since US President Donald Trump broke ranks with the major powers and ushered in a new round of sanctions against Tehran.

Trump intends to bring the Mullahs in Tehran to their knees by forcing Iran’s oil export to cease as early as November. Iran hopes to agree on a package with the Europeans to counter the impact of the sanctions.

Remaining parties to the deal have been obliging and have expressed their strong intention to work with the Iranians even without their traditional ally. However, Iranian news agencies reported that ahead of the talks, Iranian President Hassan Rouhani told the leaders of France and Germany that a European package of economic measures to counter the effects of US sanctions does not go far enough.

Yesterday, Rouhani is reported to have told French President Emmanuel Macron in a phone call that the package “does not meet all our demands”. In another phone call to German Chancellor Angela Merkel, Rouhani said the European economic measures are “disappointing”.

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“Unfortunately, the proposed package lacked an action plan or a clear roadmap for continuation of cooperation. It only included some general promises like previous EU statements,” the Iranian leader said, adding that he hoped to see deficiencies in the package resolved during today’s meeting.

If the major powers are able to agree on a package, Trump’s hopes of bringing Iran’s oil export to zero will take a massive blow. The maverick businessman turned politician is desperate to get his troops in line to deal with any shock that may follow. He’s even threatened  his Gulf allies to play their part or risk losing US as a security partner; a threat which the Saudis may not have been prepared for when they were cheerleading Trump to pull out of the deal.

One of Trump’s main concerns is the rise in the price of oil, which he is determined to avert by forcing the Saudi’s to pump out more than they want to. Iran’s OPEC Governor, Hossein Kazempour Ardebili, however did not mince his words while speaking about the current crises in the global oil markets. Trump is to blame for rising oil prices and any attempt at urging big producer countries to ramp up output to thwart a spike in crude will be futile, he told the Financial Times.

Referring to Trump’s threat against the Saudis Ardebili said: “The responsibility of paying unnecessary prices for oil by all consumers of the whole world, especially by average Americans at gas stations, rests solely upon your shoulders.”

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The Iranians appear not to be hanging all their hopes on today’s meeting in Vienna. They have gone on the offensive and threatened to close the Strait of Hormuz unless the impact of US sanctions on Tehran is averted. The mere threat of closing the strait, industry experts point out, increases market uncertainty, stokes oil prices and creates some leverage for Iran even without requiring that it follow through.

The Strait of Hormuz facilitates the movement of some 30 to 35 per cent of the world’s maritime oil trade. Close to 17 million barrels of oil travel through the strait each day, and all Arabian Gulf shipping must travel through it, including shipping from every port in Iraq, Kuwait, Bahrain and Qatar, most of the ports in the United Arab Emirates and some critical ports in Saudi Arabia. Consequently, threats to the Strait of Hormuz, whether realistic or not, drastically affect market certainty because all of the world’s big oil or natural gas importers — including the United States — depend on the secure passage of shipping through the strait.

In what looks like a polite admonition of Trump’s counterproductive strategy to bring Iran to its knees and threatening his allies unless they play ball, Ardebili said: “All you [Trump] have done is hammer [producer countries], by saying they owe you for protecting their regimes. But Mr President, who are you protecting them from? We are all neighbours for centuries and will remain so.”