The ball is in Iran’s court now

President Trump’s decision to withdraw from the JCPOA leaves Iran with hard choices to make. Before discussing its options, here, via Thomas Erdbrink of the New York Times, is a brief overview of the current situation in Iran:

The sense of crisis in Iran runs deep and wide. The economy is in free fall. The currency is plummeting. Rising prices are squeezing city dwellers. A five-year drought is devastating the countryside. The pitched battle between political moderates and hard-liners is so perilous that there is even talk of a military takeover.

Now, the lifeline offered by the 2015 nuclear deal, which was supposed to alleviate pressure on Iran’s economy and crack open the barriers to the West, is falling apart, too: President Trump announced Tuesday that he was withdrawing the United States from the agreement, which he called a “disastrous deal.”

As a result of Trump’s decision, the regime must decide whether to adhere to the JCPOA or ramp up its uranium enrichment. Hassan Rouhani, Iran’s president, went on television following Trump’s announcement to declare that Iran will not ramp up its enrichment program. Rather, it will negotiate with the other parties to the agreement, Russia, China, Britain, France and Germany.

But can Rouhani make this stick? It was always doubtful that he had the power to make key decisions like those pertaining to the nuclear deal. Now that the deal he reportedly put his prestige on the line to consummate seems to be exploding, his position may be further weakened.

But his political opponents, the so-called hardliners, must think carefully about how to proceed. For one thing, they must assess how likely it is that kick-starting the nuclear program would lead to a military response by the U.S. and/or Israel. Even the hardliners probably aren’t looking for a shooting war with nations with the kind of air power the U.S. and Israel, to a lesser extent, possess

In addition, even hardliners have to worry about Iran’s economy. Trump will be calling on oil traders and companies around the world stop purchasing Iranian oil. Those that do business in the U.S. will be likely to comply, given the sanctions they face if they don’t.

Iran will likely offer big discounts to traders and companies that won’t comply. That could be great for refiners in Asia, but not so good for Iran.

In this troubling economic context, and with protests continuing throughout the land, the Iranian regime must worry about being overthrown by the military. According to Erdbrink, “dissatisfaction over state policies is so widespread that many wonder if the Islamic Republic and its current ideology are even sustainable, fueling talk of bringing in a military strongman to set things straight.”

Rouhani’s announcement that Iran, rather than restarting uranium enrichment, will negotiate with Russia, China, Britain, France and Germany, is a recognition of these realities. And these realities cannot easily be shrugged off by Rouhani’s political opponents, the “hardliners.”

But how much can be gained by negotiating with Britain, France, and Germany? These nations may come under intense pressure, both diplomatic and economic, from the U.S. not to bail Iran out of the predicament Trump’s decision has created. On the other hand, it’s possible that the U.S. will want Britain, France, and Germany to play enough ball with Iran to keep the mullahs in the deal — that is, to keep them from ramping up the nuclear problem.

The best strategy for Iran would probably be to negotiate with the U.S. and to make a few concessions to Trump. Call it the Kim Jong Un approach. However, I don’t expect the mullahs to accept the humiliation at the hands of “The Great Satan” that allowing the Trump administration to rewrite the nuclear in any respect would entail.

If the Iranians decide to scrap the deal and ramp up their nuclear program, the ball will be back in America’s court, and/or Israel’s. That’s when things might get very interesting. But I’ve already speculated enough for one blog post.

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