Extending Iran nuclear talks puts deal at risk of domestic derailing

Despite a frenzied weekend of negotiations in Vienna capping 14 months of unprecedented diplomatic engagement, Iran and world powers have failed to reach an agreement addressing Western concerns over Tehran's nuclear program. But as yet, no one has has walked away from the table. The parties agreed Monday to a seven-month extension for reaching a final agreement — news that underscored both what has been achieved and the continued desire of all parties for a diplomatic solution.

Still, analysts warn that the extension could make concluding a deal more difficult because domestic political opposition to compromise is likely to increase in both Tehran and Washington and the durability of international sanctions against Iran could come into question.

While the details of the extension have yet to be publicly announced, sources confirmed that the agreement would set a deadline for March 1 for a broader deal, with another three months to finalize any technical aspects. Iran will reportedly receive an additional $700 million a month in temporary sanctions relief during the interim period.

“It is hardly surprising that the parties have not been able to resolve a 12-year-old crisis within 12 months,” said Ali Vaez, an Iran expert with the International Crisis Group (ICG). He said the extension was preferable to a breakdown in talks, but added, “Given the stakes and sensitivities in Tehran and Washington, this process cannot be put on life support for long.”

The Joint Plant of Action (JPOA) agreed a year ago by Iran and the P5+1 group — the United States, France, Britain, Germany, Russia and China — involved a down payment of good faith measures to facilitate negotiations over a final agreement: It saw Iran agree to cap its enrichment levels, reduce its stockpiles of enriched uranium and accept more intrusive international inspections, while the West gave Tehran limited sanctions relief.

The interim agreement (PDF) has stopped the nuclear work that most alarmed Western powers because it gave Tehran the potential to build nuclear weapons in a shorter time frame, but it has kept in place the financial and energy-sector sanctions most painful to Iran's economy. That imbalance in leverage will become more of a factor, particularly in Tehran's decision-making circles, the longer the process is extended.

Negotiators in Vienna failed to reach agreement on the timing and scope of sanctions relief, and on what restrictions on uranium enrichment Iran would be required to voluntarily accept over and above those demanded by the Nuclear Non-Proliferation Treaty (NPT) to which it is a signatory. The NPT allows all signatories to enrich uranium for civilian purposes, but the U.S. and its allies fear that Tehran could use infrastructure permitted under the NPT to create fissile materiel to build nuclear weapons should it break out of the treaty. That's why Western powers want Iran to accept restrictions beyond those required by the NPT, in order to strengthen safeguards against any “breakout” toward weaponization. Iran denies that it seeks nuclear weapons, but insists on recognition of its rights under the NPT — a principle partly addressed by the fact that Western powers now appear to accept that Iran will maintain some degree of enrichment capacity on its own soil, having previously insisted that Tehran should not be allowed any such infrastructure. But the extent of Iran's enrichment capacity remains a point of contention, as is the question of the timetable and scope of easing the sanctions that have hindered Iran's economic growth.

“The domestic political costs of an extension will not be easy to contain,” said Reza Marashi, research director for the National Iranian American Council. “To date, Obama and Rouhani have done a fairly good job of handling their hawks and keeping them boxed in. An extension could empower extremists in both capitals who have long sought to torpedo the negotiations.”

Iran’s President Hassan Rouhani was elected in June 2013 with a mandate to repair relations with the international community, but ultimate decision-making power in Iran — including over the terms of the any nuclear deal — remains in the hands of the clerical Supreme Leader, Ayatollah Ali Khamenei. Despite his intense distrust of the U.S. and its allies, Khamenei also recognizes that Iran’s economy desperately needs relief from the burden of sanctions. But Khamenei needs to be able to cast any deal as a win for Iran and a defeat for Iran's enemies, and he is reluctant to make what he thinks are undue concessions. Hardliners in Iran are also less inclined to seek a wider normalization of relations with the West. 

“A straight extension will place the Rouhani administration in a very difficult position,” said Farideh Farhi, a leading Iran scholar based at the University of Hawaii, noting that the status quo created by last November’s agreement is more comfortable for the U.S. than for Iran. While it's “easier for Western powers to live with a straight extension," Farhi said, "this imbalance also risks the total collapse of the talks if not given due attention."

The continuation of the most economically damaging sanctions is made that much more painful by the plunge in global oil prices, added Vaez of ICG. 

Iranian decision makers are also aware that their own enrichment activity ­— particularly when they enriched uranium to 20 percent purity, which substantially shortens to time frame required to reprocess that material to weapons-grade — helped create the sense of urgency that made Western powers more open to compromise on lower levels of enrichment. Some in Tehran will argue fiercely against continued concessions on Iran's own leverage while the sanctions leverage of the Western powers remains in force.

In Washington, however, efforts are underway in Congress to actually increase sanctions pressure on Iran, and to set tougher terms for any agreement than those demanded by the administration. That's the goal of the 2013 Nuclear Weapon Free Iran Act, which President Barack Obama has threatened to veto but which was backed by a majority of senators even before the November election. A previous effort to bring that bill to the floor while talks were underway was narrowly defeated, as Democrats agreed to put a vote on hold while diplomacy ran its course. But with the Republicans set to take control of Congress in January after winning a majority in the Senate, the already narrow political window for diplomacy is likely to further shrink.

Many experts concur with the Obama administration’s warning that if enacted, the bill would effectively derail the negotiations because the Iranians have made clear they would not continue to observe the terms of an interim agreement they already see as unbalanced if further sanctions were imposed.  

“In the absence of a deal, Congress is likely to pull the plug by next February,” Vaez said.

The fate of sanctions, however, may not be settled in Congress. Because the U.S. has barely traded with Iran in more than three decades, measures imposed by the legislature are designed to block other countries from doing business with the Islamic Republic. Some of those countries, including P5+1 members China and Russia, have somewhat reluctantly and only partially observed U.S.-led sanctions, and if the negotiation process breaks down, they are less likely to follow a U.S. lead. 

“The primary leverage that the U.S.-led side has brought to the table is the international sanctions regime that has limited Iran’s energy exports and choked off its access to international financial networks,” wrote Gary Sick of Columbia University, a former National Security Council Iran specialist for three administrations. “But those are not U.N. sanctions; they rely primarily on Washington’s ability to persuade or pressure companies in countries whose governments do not endorse those sanctions to refrain from trade with or investment in Iran.”

The Ukraine crisis has deepened U.S.-Russia differences already evident over Syria, and with Moscow now itself the target of Western sanctions, Russia's incentive for heeding U.S. sanctions on Iran may be rapidly diminishing. 

China and Russia have recently accelerated moves to deepen their ties with Iran: Beijing has expanded trade opportunities with Tehran and last month conducted joint military exercises with Iran's navy, while Moscow and Tehran recently inked an agreement to trade Iranian oil for Russian industrial products.

The “deference to the United States" by P5+1 countries "is not unqualified,” Sick said. “If the United States should reject what is perceived to be a reasonable Iranian offer, there are growing signs that the coalition might begin to fray.”

While all sides prefer the continuation of negotiations announced in Vienna to a complete breakdown, domestic political pressures and changes in the wider diplomatic equation suggest those talks could become increasingly urgent — and fraught.