A reported agreement between the United States and Iran to hold bilateral talks has provided a glimmer of hope after months of diplomatic stalemate over Iran’s nuclear programme. The details and veracity of the apparent deal remained murky after the New York Times reported it in its 21 October edition. A White House spokesman denied that there was any agreement to conduct bilateral negotiations after the US presidential elections. Iran issued a similar denial.

A reported agreement between the United States and Iran to hold bilateral talks has provided a glimmer of hope after months of diplomatic stalemate over Iran’s nuclear programme. The details and veracity of the apparent deal remained murky after the New York Times reported it in its 21 October edition. A White House spokesman denied that there was any agreement to conduct bilateral negotiations after the US presidential elections. Iran issued a similar denial.

However, what is clear is that arrangements are under way for a resumption of talks between Iran and the E3+3 (France, Germany, United Kingdom, plus China, Russia and the US, otherwise known as the P5+1). Those talks have not been held since a fruitless meeting in Moscow at the level of political directors on 18–19 June. The new ʹbreakthroughʹ may only be that Iran will meet bilaterally with the US in the context of the E3+3 talks, something Iran has so far refused to do, either in the April–June round or during two meetings that took place in 2010–2011.

On 9 October, the Guardian had reported that the E3+3 talks with Iran would resume after the US elections. Iran wanted to wait to see who would win: if President Barack Obama were to lose on 6 November, Iran would naturally be less interested in making a deal with a lame-duck administration.

Also of significance in the New York Times story was that American and Iranian officials had been holding ʹintense, secret exchangesʹ that started almost at the beginning of Obama’s term in 2009. The IISS heard hints of such exchanges last autumn, but this was the first confirmation. This aspect of the story has not been denied by Washington.

The E3+3 are preparing a ʹreformulatedʹ proposal that will for the first time offer Iran limited relief from sanctions if it agrees to significant limits on its uranium enrichment programme. One reason there has been no agreement in 2012 so far is that the E3+3 were unwilling to offer a reduction of the sanctions that were of most interest to Iran, and Tehran in turn was unwilling to offer attractive compromises. Each side demanded that the other move first in making concessions. The new proposal from the six powers reportedly attempts to overcome the sequencing impasse by choreographing a step-by-step series of reciprocal actions.

According to some reports, consideration is also being given to a more comprehensive approach that would acknowledge Iran’s right to enrichment at low levels if it accepts more intrusive monitoring and limits on production and accumulation. In any case, recent advances in Iran’s enrichment programme give the US and its European allies reason to demand more concessions from Iran in exchange for sanctions relief.

Stalemate over enrichment

In negotiations earlier this year, the E3+3 put forward what they described as a set of confidence-building measures. Setting aside for the time being the demand enshrined in successive United Nations Security Council resolutions that Iran suspend all uranium enrichment, the six powers instead focused on the enrichment activity of most immediate concern. They asked Iran to stop enriching uranium up to 20%, to ship out of the country the accumulated stockpile of uranium enriched to that level and to shut down operations at the deeply buried facility at Fordow where most of the 20% enrichment work is being conducted. In exchange for what was termed ‘stop, ship and shut’, the E3+3 offered to provide 19.75% enriched fuel plates for the Tehran Research Reactor (TRR), along with nuclear safety assistance and spare parts for civilian aircraft, which Iran has been unable to obtain due to sanctions. No other sanctions would be lifted under the E3+3 offer, but no additional measures would be imposed if negotiations were successful.

Enrichment up to 20% alarms many states because it is on the cusp of being usable for nuclear weapons and can quickly be further enriched. A year ago President Mahmoud Ahmadinejad said Iran could stop the 20% enrichment in exchange for replacement fuel for the TRR, which is running out of the fuel last provided by Argentina in 1993. He and other Iranian officials repeated that offer this month.

Yet in the official talks, Iran’s nuclear negotiator Saeed Jalili – secretary of the Supreme National Security Council – held to a much harder line, demanding a complete lifting of all sanctions and recognition of the right to enrichment. He hinted that Iran might then agree to suspend the medium level enrichment, but at no time did he suggest this might be done in exchange for fuel. Jalili also rejected the notion of exporting any of the accumulated stockpile or shuttering Fordow. By appearing to be more compromising in what it said to the press, Iran played an artful public diplomacy game, but frustrated its negotiating partners.

Meanwhile Iran also frustrated the International Atomic Energy Agency (IAEA) by repeatedly rejecting its requests to verify reports of nuclear activity of a ‘possible military dimension’. IAEA Director General Yukiya Amano said in London on 17 October that the IAEA had identified 12 such issues on which it was seeking verification.

As a first step, the IAEA asked in January for access to a part of the Parchin military base where Iran had reportedly conducted nuclear weapons related high explosive testing. The IAEA did not know whether it would find anything incriminating at Parchin, but it wanted to hear Iran’s explanation for the experiments, and to see if a visit could corroborate or disprove Iran’s story. Officials at the Vienna-based agency thought that developments at Parchin might be the easiest of the alleged weapons-related activities to investigate, because there was a precedent for IAEA visiting it (twice in 2005, with no results that reflected badly on Iran) and because the evidence of possible weapons-related activity did not depend solely on Western intelligence. The IAEA had assembled much of the case on its own, including by interviewing former Soviet nuclear weapons expert Vyacheslav Danilenko, who allegedly helped Iran build a large explosives containment vessel at Parchin.

Hopes that the Parchin issue might be put to rest were dashed when, shortly after the IAEA asked to visit the site, Iran began cleaning out the building housing the explosive chamber. The cleansing, observable from satellite imagery, intensified the IAEA’s desire to visit Parchin while there might still be a chance of finding traces of uranium. In February, Iranian officials seemed to be willing to reach an agreement on a ʹstructured approachʹ for addressing all of the allegations about military-related nuclear activities, but hardliners representing the Supreme Leader imposed conditions that would have contravened standard verification requirements.

It seemed clear to many that Iran had something to hide at Parchin. Iran also wanted to hold any compromises with the IAEA hostage to the results of negotiations with the E3+3 so that it could exchange transparency on inspections for sanctions relief.

European bargaining

If diplomatic talks are to result in any softening of sanctions, some of the measures imposed by the EU are the most likely to be lifted. This is because changing any of the EU measures can be decided upon by a consensus vote of the foreign ministers of the 27 member states. The most onerous US sanctions, by contrast, are imposed by law and could only be changed with the consent of the Congress, which is intensely hostile to the Iranian government and deeply divided politically.

New sanctions measures imposed by the EU on 15 October might therefore be seen as potential bargaining chips. The new measures are onerous in two key ways. Firstly, although the ban on importing Iranian natural gas may be seen as symbolic given that Europe does not import any gas from Iran, the ban on purchasing Iranian gas affects what has been a significant European trade in Iranian gas. That business will now stop. Secondly, the rule governing financial transactions with Iranian banks, which formerly had allowed business that was not explicitly prohibited, has been reversed. Now, all financial transactions between European and Iranian banks are banned except for those transactions that are expressly allowed, mostly for humanitarian purposes.

Nuclear programme timetable

The new EU sanctions resulted from frustration over Iran’s intransigence with the IAEA and the E3+3 and concern over advances in Iran’s enrichment programme. As of mid-August, Iran had produced 6,900 kg of uranium enriched up to 5% and 190 kg of up to 20% enriched product. If further enriched, these stockpiles are enough for at least four nuclear weapons. If Iran’s Supreme Leader Ali Khamenei were to reverse his religious edict against nuclear weapons (for example by claiming that circumstances had changed), Iran might be able to produce one weapon’s worth of highly enriched uranium (HEU) in less than half a year. The Institute for Science and International Security in Washington calculates that the timeline for HEU production could even be as short as between two and four months. Fashioning the HEU into a crude weapon could take another six months. Making the weapon small enough to fit the nosecone of Iran’s ballistic missiles would probably take at least an additional year.

Of gravest concern in the most recent IAEA report is that Iran has now installed a total of about 2,100 centrifuges in the Fordow enrichment facility and is preparing to install 900 more. As of mid-August, only about 700 of the machines were being used to produce up to 20% enriched uranium. Some of the other centrifuges lacked converters or other key components. This may partly be due to a shortage of components, exacerbated by sanctions and intelligence operations that have dried up foreign supply. It also seems apparent that Iran has chosen to limit the expansion of its medium-enriched product, so as not to spark an international crisis. If Iran were to use 3,000 centrifuges at Fordow for 20% enrichment, it could produce enough material for a nuclear weapon in as little as two months, according to the Institute for Science and International Security.

Iran’s ability to use its declared enrichment facilities for weapons purposes is restricted by the tempo of IAEA inspections. The agency inspects all of the enrichment facilities at least twice a month. An additional two unannounced inspections are conducted every month at Fordow and at the pilot enrichment plant at Natanz, where up to 20% enrichment also takes place.

Any attempt to further enrich uranium to weapons grade at these facilities would be detected in time for major powers to stop the activity either through diplomacy or a pre-emptive strike. It is thus more likely that, if Iran chose to go for broke and produce weapons-grade uranium, it would do so at a clandestine plant. This would also be a huge gamble, however, because to date Iran has not been able to keep enrichment facilities hidden: both Natanz and Fordow were discovered at an early stage by Western intelligence agencies, which devote intense efforts to watching for all possible new construction.

In calibrating its enrichment activity so as to avoid excessive provocation, Iran has converted over one third (71 kg) of its stockpile of 20% enriched uranium hexafluoride to oxide form. Some portion of that oxide has been formed into pellets and sintered for fuel plates for the TRR. Conversion to oxide does not render the product unsuitable for further enrichment: the powdered oxide can be reconverted to gasified form within a couple of months, for spinning in the centrifuges. Still, those extra months would have to be factored into the timeline for any decision to ‘break out’ and produce nuclear weapons. And each step in the fuel fabrication process puts the enriched uranium further away from any weapons use.

The oxide conversion of part of the 20% product is one reason that Israeli Prime Minister Benjamin Netanyahu has adjusted his position on the imminence of an Iranian nuclear weapons threat. Earlier, he and Defence Minister Ehud Barak had spoken of Israel’s deadline for conducting a pre-emptive strike being measured in weeks, not months. But in his 27 September presentation to the UN General Assembly, Netanyahu in effect put off for six to nine months the deadline for military action to stop Iran’s programme before it could reach the point of producing a bomb.

Some people question, though, whether diplomacy can work any better during the next six months than it has worked during the last six months. Rather than let Ahmadinejad claim credit for any diplomatic success, his rivals, including Khamenei, may want to wait until after the June election and the August inauguration of a new president before agreeing to a compromise that would be acceptable to Washington. By then, Israel’s new deadline would have been exceeded.

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