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Iran's top nuclear negotiator Abbas Araqchi and Secretary General of the European External Action Service (EEAS) Helga Schmit attend a meeting of the JCPOA Joint Commission in Vienna, Austria, 28 June 2019. REUTERS / Leonhard Foeger

Iran Briefing Note #3

Iran Briefing Notes highlight and provide context for the previous week’s major events featured on International Crisis Group’s Iran-U.S. Trigger List. This infographic resource tracks developments on key flashpoints between Iran, the U.S. and their respective allies in the Middle East.

Events of Note

28 June: Seven European governments issue a joint statement on working with the E3/EU toward trade channels with Iran.

28 June: The JCPOA’s Joint Commission convenes in Vienna.

28 June: A U.S. Senate vote tallies 50 votes against an unauthorised military strike on Iran but fail to muster the required 60 votes for passage.

1 July: Syria claims Israel was behind airstrikes in Damascus and Homs.

1 July: Iran breaches a JCPOA limit on enriched uranium stockpiles.

1 July: Iraq’s government decrees that paramilitary groups “are to operate as an indivisible part of the armed forces”.

3 July: President Rouhani warns that Iran will increase uranium enrichment level and restore Iran’s heavy water reactor on July 7.

Credit Where It Is Due

On 28 June, the EU announced that a special-purpose vehicle for trade with Iran was up and running.

Why it matters: In January, the Joint Comprehensive Plan of Action’s (JCPOA) three European signatories set up a trade mechanism (INSTEX) to “facilitate legitimate trade with Iran” – specifically food and medicine already theoretically exempted under U.S. sanctions. With Iran making the case that its compliance with the deal’s nuclear restrictions was yielding little economic dividend, the innovation at the core of the mechanism was processing transactions without exposure to U.S. penalties. Over the past few days, there have been three notable developments: the E3 (France, Germany and the UK) prepared to roll out credit lines; the EU confirmed “that the first transactions are being processed”; and seven European states jointly indicated their interest in participating. The Iranian response has been lukewarm so far: one senior official compared the measures to “a very beautiful car which has run out of fuel”. The dilemma with INSTEX remains that a minor boost to trade will not be sufficient to address Iranian expectations and keep it in the JCPOA, while success raises the possibility that the U.S. will try to stifle the channel through sanctions.

Spinning Toward Non-compliance

On 1 July, Iran’s stockpile of 3.67 per cent enriched uranium passed the JCPOA’s 300kg limit.

Why it matters: Iran announced in May that it would begin curbing its compliance with the 2015 nuclear deal, and had threatened to break a cap on low-enriched uranium (LEU) ahead of the JCPOA’s 28 June Joint Commission meeting. It held off crossing the 300kg barrier, but only until 1 July. President Trump warned that Iran was “playing with fire”. The nuclear deal “is either good or bad”, said President Hassan Rouhani. He added: “If it’s good, everyone should comply with their commitments. Comparing your level of commitment to ours, how do you even allow yourselves to object?”

The remaining JCPOA signatories’ reaction to the 300kg breach was of measured concern, calling on Iran to reverse course and stick to the agreement – though stopping short of immediately engaging a dispute resolution mechanism laid out within the JCPOA for cases where a party is believed to be non-compliant. How long that remains the case will likely be determined by how far Iran pushes the nuclear brinksmanship.

Meanwhile in the U.S. Congress

A 50-40 vote in the U.S. Senate on 28 June failed to approve legislation that would have blocked funding for military action against Iran without congressional authorisation. The numbers, while impressive, fell short of the required threshold for passage. The House will now take up a similar bill.

Why it matters: Anti-war forces in Congress are trying to include a provision in annual defence authorisation legislation that would deny funding for any military action against Iran that Congress hasn’t previously approved, unless there is a legitimate self-defence justification. Prior administrations have asserted the right to use military force without first looking to Congress, creating ambiguity about just how far the president’s war powers go. The draft legislation would resolve that ambiguity in the Iran context. It would also make clear that the 2001 authorisation to use military force against al-Qaeda and the Taliban does not apply to Iran.

Notwithstanding the Senate vote, the legislation remains on the congressional agenda, although the path to enactment is uphill. The first step will be for the House to take up its version of the Senate bill during the week of July 8. If it passes, the next step will be much tougher: House negotiators will need to persuade their Senate counterparts to include the language, or some version of it, in the merged legislation that emerges from both chambers. The bill would then go to President Trump for signature. Although the president would likely veto any legislation that he sees as tying his hands, the passage of such a provision by Congress would send an important signal of political opposition to the prospect of war.

What to Watch

7 July: Iran deadline for further curbs on its JCPOA compliance.

8 July: Secretary of State Pompeo speaks at the Christians United for Israel summit.

11 July: Beijing hosts Afghanistan conference with both U.S. and Iranian participation expected.

Click here to see the U.S.-Iran Trigger List, and here for a two-page, printable PDF of the Briefing Note.

CRISISGROUP