Nuclear Issues

Secretary of State Mike Pompeo’s most recent announcement on Iran policy has raised some eyebrows. He indicated on Monday morning that the Trump administration will not renew waivers to importers of Iranian crude and that other suppliers (meaning Saudi Arabia) have agreed to increase production in to ensure the global oil market remains well-supplied. Skeptics question whether — after last summer’s debacle — there is sufficient trust between Washington and Riyadh for this arrangement to work. What skeptics may not have digested is that, while timing remains a problem, this is a classic win-win situation. It is a near-perfect example of the very limited universe of occasions when transactional diplomacy could actually work.

The world was in suspense a week ago wondering whether OPEC and non-OPEC producers would put more oil on tightening global markets. Turns out: Yes, they will. But, as the story does not end here, it is worth assessing where we are and how we got here. While the U.S. seems to have gotten what it wanted, it is not all good news.

Oil markets have so far reacted to President Donald Trump’s decision to withdraw from the 2015 Iran nuclear deal without either enthusiasm or panic — without even much apparent interest. There are many good reasons for this, but also many reasons to think oil markets’ complacency could change. Fortunately, the Obama-era sanctions that Trump has moved to reimpose have some lesser-known safety valves should oil markets later overheat as a result of the Iran decision.

With a speed few predicted, Iran’s new president, Hassan Rouhani, has signaled his interest in negotiations this autumn on Iran’s controversial nuclear program," writes Nicholas Burns. "This could produce the first extensive contact between Washington and Tehran since diplomatic relations ruptured during the Jimmy Carter administration."

The latest Iran sanctions came into full effect this week, adding to a byzantine array of unilateral and multilateral measures that prohibit Iranian oil imports, other trade and financial transactions, and freeze Iranian assets by countries concerned that Tehran's nuclear program is intended for military purposes, not civilian ones.

China and India's simultaneous rise weighs closely on the destiny of Southeast Asia, writes Belfer Center International Council member Anindya Barkie. Their cooperation would benefit all surrounding neighbors; their contensions could tear the region apart.