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A British Royal Navy patrol vessel guards the oil supertanker Grace 1, that's on suspicion of carrying Iranian crude oil to Syria, as it sits anchored in waters of the British overseas territory of Gibraltar, historically claimed by Spain, 4 July 2019. REUTERS / Jon Nazca

Iran Briefing Note #4

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

4 July: British forces detain an Iranian supertanker off the coast of Gibraltar purportedly carrying oil to Syria

7 July: Iran announces enrichment level above JCPOA limits; warns of further steps in 60 days

8 July: Saudi-led coalition claims it thwarted a Huthi attack against a commercial vessel in the Red Sea

9 July: U.S. sanctions three Hizbollah officials, including two members of Lebanon’s parliament

9-10 July: Senior French official visits Tehran

10 July: The IAEA holds a special meeting called by the U.S. on Iran’s nuclear activity

10 July: President Donald Trump indicates that Iran “sanctions will soon be increased, substantially”

Abseiling Grace

British Royal Marines on 4 July boarded and seized the Grace 1, a tanker bearing Iranian crude oil off the coast of Gibraltar.

Why it matters: In a statement, the Gibraltar government indicated that the Grace 1 was bound for the Banias refinery in Syria, putting it afoul of EU sanctions against that country. Iran disputed the destination claim and argued that the detention was “piracy, pure and simple”; President Hassan Rouhani on 10 July called it “a stupid move” and indicated that “you will understand its consequences later”. U.S. National Security Advisor John Bolton applauded the operation as a “real Fourth of July present”, which comes at a time when Iran’s fleet is engaged in a cat-and-mouse game to export oil without detection, including to its allies in Damascus. The incident further complicates Tehran-London relations, amid concerns that the UK position on the JCPOA might be getting closer to Washington’s and further away from Berlin and Paris.

Spin Cycle

Iran announced, and the IAEA on 8 July confirmed, that it had raised uranium enrichment levels beyond the 2015 nuclear agreement’s boundary.

Why it matters: Tehran’s decision to follow a breach of the JCPOA’s quantitative cap of 300kg on low-enriched uranium by pushing past the qualitative limit of 3.67 per cent enrichment is another incremental escalation to press the JCPOA’s parties into relieving the burden of unilateral U.S. sanctions; it is also designed to warn the U.S. of more to come if its maximum pressure campaign continues. But incremental is the key: Iran’s moves are calibrated to add urgency without emergency, neither significantly reducing breakout times for a weapon nor restricting inspections at sensitive sites. In other words, Tehran aims to do enough to send a strong warning to Europe and the U.S., but not enough to justify either snapback of UN sanctions or a military response. While the U.S. may have hoped to galvanise international support for a harder stance against Tehran at a 10 July meeting at the IAEA, Washington’s own role in precipitating the crisis did little to win over the agency’s board of governors.

A High-stakes Summer

A senior aide to French President Emmanuel Macron visited Tehran on 9 June.

Why it matters: European diplomats might want to start checking if their summer vacation plans have a cancellation policy. With the clock now ticking on Iran’s new 60-day deadline before further breaches of the JCPOA, the next two months are likely to see a diplomatic surge aimed at defusing the current crisis. President Hassan Rouhani spoke with his French counterpart on 6 July and agreed to try to revive multilateral dialogue by 15 July. For the Europeans, the interactions go in two directions: first, to encourage Tehran to reverse course by offering to expedite ongoing work on financial channels that circumvent U.S. sanctions (INSTEX); second, to prod Washington to consider some form of sanctions relief. One possible way forward would be for Tehran to resume its compliance with the JCPOA and make progress on the release of U.S.-Iranian dual citizens detained in Iran in exchange for some U.S. sanctions relief, most importantly concerning Iranian oil exports. But this would require the Trump administration relenting somewhat on its maximum pressure campaign, which is not particularly likely.

What to Watch

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

12 July: Hizbollah chief Hassan Nasrallah scheduled to give a television interview

14 July: Anniversary of JCPOA’s finalisation in 2015

15 July: Senior European diplomats convene for the EU Foreign Affairs Council

15 July: President Macron’s deadline for resumption of multilateral dialogue over JCPOA

Mid-July: Iranian Foreign Minister Javad Zarif visits New York

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

CRISISGROUP