Israeli response to the US waiver for Iran

Over the weekend, the United States made stunning news giving Iran a sanctions waiver to return to the 2015 JCPOA nuclear deal. Israel and critics of the JCPOA immediately took this as a bad sign of the emergence of a weaker deal, but how bad is it really?

The Iran nuclear deal that world powers are negotiating in Vienna will make it harder to stave off a nuclear Iran, Prime Minister Naftali Bennett warned at the opening of Sunday’s cabinet meeting.

“Foremost among the threats to the State of Israel is Iran,” Bennett said. “We, as the cabinet, are responsible for taking on the Iranian nuclear [threat], and are closely following what is happening in the talks in Vienna.”

Bennett said, “The agreement and what appears to be its conditions will damage the ability to take on the nuclear program.

“Whoever thinks an agreement will increase stability is wrong,” he added. “It will temporarily delay enrichment, but all of us in the region will pay a heavy, disproportionate price for it.”

According to The Jerusalem Post, it is a very clear sign that the United States is trying to close a return to the deal by mid-February when the IAEA issues its next report or by March 7, 2022, when the IAEA Board of Governors meets. These are opportunities that only come up once every three months to exercise additional pressure on the Islamic Republic.

Put simply, Washington's leverage to get the ayatollahs to return to the nuclear limits is the existing sanctions leverage. If the US starts to lift sanctions before Iran has given anything up, why should the Islamic Republic show any readiness to compromise?

This goes along with other recent signs, such as a split in the US negotiating team in which three members resigned over their view that the Biden administration's approach to the negotiations was too flexible and lenient toward Tehran.

For one, leaks to the Wall Street Journal last week indicated that those resigning were unhappy with a return to the JCPOA which would leave Iran closer to six months away from crossing the uranium enrichment threshold as opposed to the deal's original 12-month goal.

The waiver from this weekend covered the conversion of Iran’s Arak heavy water research reactor - which relates to its potential plutonium path to a nuclear weapon, delivering to it enriched uranium for its Tehran nuclear research reactor and facilitating the transfer of spent and scrap reactor fuel abroad.

None of these sanctions relief helps Iran's economy one iota. They also do not advance its nuclear program at all. Rather, all of these items were part of the JCPOA itself and were actions that either kept or maintained Iran's ability to have a civil nuclear program, while cutting it off from military options.

The truth is that the Trump administration's decision in May 2020, only a few months before the November 2020 presidential election, to cancel these sanctions waivers was bizarre. It served no purpose other than to remove an exit ramp for Iran to return to the nuclear deal if it wanted to.

Essentially, it was an attempt to preemptively sabotage the Biden administration from being able to return to the JCPOA given that Biden was leading Trump in the polls.

These items are all basically part of the machinery of how the JCPOA operates at a civil nuclear level completely within the nuclear limits.

For example, the provisions regarding the Arak reactor actually prevent Iran from advancing a plutonium path to a bomb, transferring spent and scrap reactor fuel abroad prevents Iran from using it at home, and even transferring a tiny amount of non-weaponized enriched uranium keeps Iran under the 300 kilogram and 3.67% enrichment level limits of the deal.   

Tactically, this is the Biden administration trying to show it is eager to facilitate the machinery of the JCPOA and it can box Tehran into needing to show good faith on its part, or risk being blamed for the failed negotiations.

Of course, this is not the result that the Israeli government wants , though a rising number of voices in the Israeli defense establishment want a deal if only to slow and freeze Iran's march to the 90% uranium weaponization level.

It does signal Washington's desperation for a deal and all other signs are that the new deal will be weaker than the JCPOA had been.

But of all of the recent signs pointing in this direction, this sanctions waiver was actually the least significant and the smallest concrete negative change from an Israeli government perspective.

Signs of an imminent full or partial deal would involve sanctions waivers to countries like China, India, Greece, Italy, Taiwan, Japan, Turkey and South Korea.

These were eight countries that even the Trump administration granted exemptions to from sanctions during May 2018 to May 2019.

Iran welcomes US sanctions move but terms these insufficient

The steps taken by the United States on lifting sanctions are ‘good but not enough’, Iran said following Washington’s announcement it was waiving sanctions on Iran’s civil nuclear program.

The US action came as talks to restore a 2015 deal between Tehran and world powers over its nuclear program reached an advanced stage, with the issue of sanctions relief a major issue.

“The lifting of some sanctions can, in the true sense of the word, translate into their goodwill. Americans talk about it, but it should be known that what happens on paper is good but not enough,” Iranian Foreign Minister Hossein Amir-Abdollahian said, quoted by ISNA news agency.

The secretary of Iran’s Supreme National Security Council also reflected Tehran’s view that the US move falls short.

“Real, effective and verifiable economic benefit for Iran is a necessary condition for the formation of an agreement,” Ali Shamkhani said in a tweet.

“The show of lifting sanctions is not considered a constructive effort.”

The US State Department said on Friday it was waiving sanctions on Iran’s civil nuclear program in a technical step necessary to return to the 2015 Joint Comprehensive Plan of Action, or JCPOA.

Former US President, Donald Trump withdrew from the pact in 2018 and re-imposed crippling sanctions on Iran, prompting the Islamic Republic to begin pulling back from its commitments under the deal.

The waiver allows other countries and companies to participate in Iran’s civil nuclear program without triggering US sanctions on them, in the name of promoting safety and non-proliferation.

Iran’s civil program includes growing stockpiles of enriched uranium.

Amir-Abdollahian reiterated that one of the main issues in the JCPOA talks is obtaining guarantees that the US will not withdraw from the 2015 deal again.

“We seek and demand guarantees in the political, legal and economic sectors,” he said, adding “agreements have been reached in some areas”.

Iran is negotiating with Britain, China, France, Germany and Russia directly and with the US indirectly in the Vienna talks, which different parties say have reached a stage where the sides have to make important political decisions.

“Our negotiating team in the Vienna talks is seriously pursuing obtaining tangible guarantees from the West to fulfill their commitments,” said Amir-Abdollahian.

Foreign ministry spokesman Saeed Khatibzadeh said, “Iran is carefully considering any action that is in the right direction of fulfilling the obligations of the JCPOA”, Iranian media reported.

The European parties to the talks urged Iran to seize the opportunity of the US waivers.

“This should facilitate technical discussions necessary to support talks on JCPOA return in Vienna,” negotiators of Britain, France and Germany said in a joint statement on Saturday.

“We urge Iran to take quick advantage of this opportunity, because the timing of the waiver underscores the view we share with the US, we have very little time left to bring JCPOA talks to a successful conclusion.”

Iran joins Russia to end petrodollar dominance

In a commentary on February 04, 2022, The National Interest said Iran and Russia, as two countries subject to US sanctions, are seeking to undermine the petrodollar’s dominance in global finance and trade.

Following is an excerpt of the article:

During Iranian President Ebrahim Raisi’s recent visit to Moscow, a number of agreements with Russian oil and gas companies related to constructing petro-refineries and transferring technology and equipment were signed.

Vladimir Putin is the first Russian president to visit Iran since Josef Stalin’s visit in 1943. Since 2007, Putin has traveled to Tehran twice to attend a summit of Caspian littoral states, and in each visit, he met with Leader of the Islamic Revolution Ayatollah Ali Khamenei.

In 2007, Ayatollah Khamenei told Putin “A powerful Russia is in Iran’s interest,” to which Putin replied, “The interest of the Russian nation lies in a powerful and influential Iran in the international scene.”  

Prior to the 1979 Revolution, the United States had total domination over Iranian politics. After the revolution and during Saddam Hussein’s protracted war against Iran, both Washington and Moscow heavily supported Iraq’s invasion of Iran.

But, after the Iraq-Iran War, Moscow changed its policy toward Iran and sought to build a friendship while the United States and the West embraced hostility. The détente between Tehran and Moscow has had significant consequences for the region’s geopolitics. 

Both Iran and Russia “admonish the United States’ hypocrisy on human rights, terrorism, and unilateralism.”

Ayatollah Khamenei made it clear, “Tehran and Moscow must step up cooperation to isolate the United States and help stabilize the Middle East.” As a result, Tehran and Moscow have directed their policies in West Asia to isolate the United States. Tehran and Moscow’s full-blown support prevented the Assad government from collapsing, while the United States and its allies supported the war in Syria aimed at overthrowing Bashar al-Assad. 

There are numerous areas that Iran and Russia can find common ground. To elaborate further, both combat extremist groups, such as ISIS and al-Qaeda; both admonish the United States’ hypocrisy on human rights, terrorism, and unilateralism; both grapple with US sanctions and hope to topple the petrodollar’s dominance in global finance and trade. 

On the economic front, geographical proximity and transit connections are likely to strengthen trade and business between the two countries. In some ways, the North-South corridor of trade, which passes through the historic cities of the Caucasus through the Persian Gulf and India, will be restored. The Russian dream to access the warm waters of the Persian Gulf may soon materialize.  

Nevertheless, there are also divergences between Iran and Russia on some issues. For example, Russia has close ties with Israel, while Iran considers Israel an enemy. Russia also seeks to attract Turkey and Saudi Arabia away from the United States.

Kazem Jalali, Iran’s Ambassador to Russia emphasizes how President Ebrahim Raisi’s visit to Moscow is a “turning point” in relations between the two countries. “Iranians begrudge the Tsarist Russia” but “today’s Russia is different from the Tsarist Russia.”

Jalali added, “Russia is facing the West, and Putin and his close associates look positively at Raisi’s presidency.”

Today, Iran is dealing with the “White Tsar” (current Russia), which is different from “Red Tsar” (the old Russia).

In his meeting with Putin, President Raisi said, “The relations between Tehran and Moscow are on the path towards strategic ties.”

 

Iraq fails in meeting oil production quota

Iraq, second-largest producer of OPEC and one of the leading OPEC plus members is struggling to boost its oil production as much as its quota in the pact allows. 

However, with January output of 120,000 barrels per day (bpd) was lower than its production ceiling, according to data from state marketing firm SOMO, according to a Reuters report.

The figures from SOMO showed that instead of rising, oil production in Iraq dropped in January by 63,000 bpd from December 2021. This was due to insufficient storage capacity, an oil official in Iraq told Reuters.

Exports from the second-largest OPEC producer after Saudi Arabia declined in January because of bad weather, maintenance of export terminals and technical issues, the official said.

Unplanned outages and a lack of capacity to pump more led to lower or stagnant production in January at OPEC members Iraq, Iran, Angola, Congo, and Libya, a Reuters survey showed earlier this week.

Iraq and several other producers among OPEC and OPEC plus are not pumping as much quantity as the pact allow. This is tightening the market and distorting analyst assumptions about market balances.

For half a year now, OPEC plus has actually added lower volumes to the market each month than the 400,000 bpd nominal monthly increase announced in each of the OPEC plus meeting since August 2021.

At its latest monthly meeting on Wednesday, the OPEC+ group announced another 400,000 bpd increase in production for March.

While the nominal increase is modest, as in the previous seven months, many producers within the OPEC plus group are struggling to pump to their quotas, leaving an increasingly large gap between production increase on paper and actual growth in output, which leaves the market tighter than many analysts and forecasters, had anticipated just a few months ago.

Going forward, the market will be closely looking at how much of that increase OPEC plus can actually deliver, considering that half of its members have lagged in ramping up output to their quotas so far, while more producers­—with few exceptions such as Saudi Arabia and the UAE—will be struggling to raise production.

Indian Last Minute Diplomatic Boycott of Beijing Olympics

India announced a diplomatic boycott of the Beijing Olympics on February 03, 2022 after the Chinese Communist Party (CCP) picked a People’s Liberation Army (PLA) soldier involved in a bloody 2020 conflict with India as a torchbearer in the Games’ torch relay. 

India’s state broadcaster also decided to not telecast the opening and the closing ceremonies of the Games as a result.

“It is indeed regrettable that the Chinese side has chosen to politicize an event like the Olympics … the Charge d’Affaires of the Embassy of India in Beijing will not be attending the opening or the closing ceremony of the Beijing 2022 Winter Olympics,” said Arindam Bagchi, the official spokesperson of the Ministry of External Affairs on Thursday.

The Indian government was considering sending its top diplomat to Beijing to attend the opening of the games until this week, but then Beijing made a PLA regiment commander, Qi Fabao, a torchbearer of the games on Wednesday, irking India. Qi had been involved in a violent border clash with Indian soldiers in the Himalaya’s Galwan Valley in June 2020.

New Delhi had earlier decided to set aside its problems with China following a meeting between the foreign ministers of India, Russia, and China in November, and supported the Games that were boycotted by many countries including the United States.

This was because traditionally India doesn’t believe in politicalizing sports events and has never boycotted one since its existence, according to Srikanth Kondapalli, a professor of Chinese studies at Jawaharlal Nehru University, New Delhi.

But India was blindsided when Qi who had sustained head injuries during the Galwan clash took the flame from Wang Meng, China’s four-time Olympic short-track speed skating champion. While doing so both “made military salutes to each other,” reported Chinese state media Global Times.

“The inclusion of a PLA soldier who tried to kill Indian soldiers at Galwan in 2020 in the Olympic torch relay was a provocative act that triggered the decision to boycott,” Madhav Nalapat, strategic analyst and vice-chair of the Manipal Advanced Research Group, told The Epoch Times.

To India, Qi’s participation is a politicization of the Games because the only criteria of his selection as a torchbearer was his involvement in Galwan conflict, said Kondapalli of Jawaharlal Nehru University.

Frank Lehberger, a sinologist specializing in CCP policies and a senior fellow at the Indian think tank Usanas Foundation, told The Epoch Times that long before the Olympics started he expected China to “concoct some symbolisms” to humiliate India during the Olympics as revenge for PLA’s “humiliating defeat at Galwan Valley.”

The Galwan conflict, which took place in the Himalayan border region for eight hours on June 15, 2020, claimed the lives of 20 Indian soldiers. The hand-to-hand combat involved PLA soldiers attacking Indians with iron rods and batons wrapped in barbed wire.

After refusing to disclose its casualty count for eight months, the CCP admitted in February 2021 to losing four soldiers, when ahead of Party’s 100 anniversary, it announced military honors posthumously for them.

However, an investigative report citing findings from a group of social media researchers published by Australian media outlet The Klaxon on Wednesday said that China lost 38 soldiers, mostly drowning in the sub-zero temperature waters of the Galwan River.

The PLA soldiers honored with the “July 01 medal” in 2021 were a part of 29 CCP members honored on the occasion. The July 1 medal is a decoration bestowed by the Party’s paramount leader on those members of the CCP who make outstanding contributions to the Party in “China’s revolution, reform, and opening up” according to CGTN, the overseas arm of China’s state broadcaster.

Chinese leader Xi Jinping, who awarded the medals in a ceremony held in Beijing’s Great Hall of the People on June 29, 2021, said the recipients had “staunch faith.”

Global Times reported at the time that having staunch faith “is to stay true to the original aspiration and dedicate everything, even the precious life, to the cause of the Party and people.”

Lehberger said India should have understood the CCP’s character and seen this coming. “And India’s reluctance joining the boycott earlier was understood by the Chinese side as the signal that they could act in even more provocative way,” he said.

Satoru Nagao, a non-resident fellow at the Washington-based think tank Hudson Institute told The Epoch Times that only 25 countries are attending the opening ceremony and most of them are “non-democratic” countries, adding that India’s decision to diplomatically boycott the Games was “good.”

“For China, admiring its soldiers is far more important than respecting India, because India is an enemy for China. Soldiers are fighting the enemy, India. China showed that it is respecting soldiers who are fighting the enemy India,” said Nagao.

This incident is not the first time the CCP has used the Galwan conflict to send a message. Over the New Year, various Chinese state media shared videos of PLA soldiers raising a CCP’s red flag at Galwan Valley.

And on December 29, 2021 the Chinese announced “standardized” Chinese names for 15 places in Arunachal Pradesh, an Indian state on the border with Bhutan and Burma that the Chinese regime has attempted to claim and aggressively intruded upon in the past few decades.

“It shows that Chinese nationalism is directed against India,” said Kondapalli, adding that there’s a need to watch out to see if this portends more aggression towards India in the future.

China will next host the 2022 Asian Games in Hangzhou in eastern China’s Zhejiang Province from September 10 to 25.

Afghan future depends on inclusive government

Pakistan’s Ambassador to Tehran, Rahim Hayat Qureshi, met Vahid Jalalzadeh, Chairman of the National Security and Foreign Policy Committee of the Iranian parliament. 

Jalalzadeh said religious, historical and cultural commonalities between the two nations and good neighborliness are important factors in deepening relations between the two neighbors in various areas.

The senior legislator stressed the importance of parliamentary diplomacy to help remove obstacles to development of economic and trade relations and said, “Continuous consultation and positive and growing dialogue between government officials, military officials, and parliamentarians are a sign of the depth of friendship and brotherhood of the two nations.”

These will help “strengthen and consolidate cooperation between each other in various fields, especially in the field of economics,” he remarked.

He added that Iranian businessmen are looking to increase the level of their economic relations with Pakistan. 

“We know this is a reciprocal feeling. We expect the officials of the relevant departments to try to pave this way.” 

In another part of his remarks, the MP reiterated the important of security cooperation in border areas to counter the actions of terrorist groups, saying the terrorist groups are not aware of the very strong relations between the officials of the two countries. 

Jalalzadeh added, “In the Islamic Republic of Iran, there is a strong consensus among the country's top officials to increase interactions with neighbors, especially the friendly and brotherly country of Pakistan.”

Elsewhere in his remarks, the legislator emphasized the establishment of peace and stability in the region, especially in Afghanistan, and said that the Afghan people have been suffering from occupation and war for four decades. 

“There should be lasting stability and security, as well as formation of an inclusive government in Afghanistan. Iran and Pakistan, as two key players in Afghanistan, can work together to alleviate the suffering of the people of this country,” Jalalzadeh pointed out.

In conclusion, Jalalzadeh emphasized the peaceful nature of Iran's nuclear activities and added that in the last two years, the International Atomic Energy Agency (IAEA) has visited Iran's nuclear sites 15 times and confirmed the peaceful nature of nuclear activities, yet Iran is under unilateral pressure from the United States.

The US and the Zionist regime continue to claim that they are concerned over Iran's nuclear activities, he noted.

For his part, Ambassador Qureshi referred to the 70th anniversary of Pakistan's independence and said Iran was the first country to recognize Pakistan’s independence.
He also considered religious, historical and cultural affinities as important in strengthening relations between Pakistan and Iran.

Elsewhere in his remarks, Qureshi said relevant Pakistani officials are moving to establish border markets with Iran.

Pointing to the high economic potential of the two countries to develop cooperation, he said, “Agreements have been signed between the officials of the two sides, which we hope will be able to increase and strengthen the level of economic and trade exchanges more than before.”

The Pakistani envoy also stressed the important and effective position and role of Iran in resolving the crisis in Afghanistan, saying the difficult situation in Afghanistan is a matter of concern for Pakistan. 

“Establishing lasting peace and stability in Afghanistan is important for the region and neighboring countries. We hope that this will be achieved with the help of the Islamic Republic of Iran in forming an inclusive government,” he concluded. 

OPEC plus decides fate of energy market in 16 minutes

The Ministers of the OPEC plus, who met via video conference, rubber-stamped in just 16 minutes the monthly production hike by 400,000 bpd. In the shortest meeting so far in its history, OPEC+ decided on Wednesday to increase the collective production by 400,000 barrels per day (bpd) in March 2002. 

This left production plan unchanged and pushed Brent price above US$90/barrel.

Some analysts, and traders, had expected a higher production increase, considering the recent rally that has frustrated major oil-consuming nations, including the United States.

Earlier this week, Goldman Sachs had expressed the view that OPEC plus might decide to announce a larger production increase for March than the usual 400,000 bpd, keeping in view the recent oil rally to and the potential for renewed discontent from major oil importers at these high price levels.

OPEC plus confirmed the 400,000-bpd increase in record time and didn’t even plan a press conference after the meeting. 

Brent Crude prices returned to US$90 per barrel just after news of the modest production increase and the record-short meeting broke.

While the nominal increase is modest, as in the previous seven months, many producers within the OPEC+ group are struggling to pump to their quotas, leaving an increasingly large gap between production increase on paper and actual growth in output, which leaves the market tighter than many analysts and forecasters, had anticipated just a few months ago.

Going forward, the market will be closely looking at how much of that increase OPEC plus can actually deliver, considering that half of its members have lagged in ramping up output to their quotas so far, while more producers­—with few exceptions such as Saudi Arabia and the UAE—will be struggling to raise production.

According to the production table provided by OPEC, Saudi Arabia and Russia will each have a quota of 10.331 million bpd in March 2022.

The next OPEC plus meeting is scheduled for March 02, 2022.