US not bending to Tehran's demands to reach deal on JCPOA: State Department

The US State Department Aug. 15 signaled that "extraneous" demands from Tehran were not being considered by Washington as Iranian officials responded to the EU's final offer to revive the 2015 nuclear accord, adding to uncertainty over whether a deal can be reached and in turn bring more crude supplies to the global market.

EU Foreign Policy Chief Josep Borrell put forth a "final text" Aug. 8 after concluding that "what can be negotiated has been negotiated." The document requires sign-off from both Iran and the US. The text largely tracks a proposal put in March that drew support from the US.

Iranian Foreign Minister Hossein Amir-Abdollahian Aug. 15 told reporters that three issues remained, with the US expressing "flexibility" on two of those. "We have explicitly told the Americans if our opinions are fulfilled in these three issues, we are ready to enter the stage to announce an agreement," he said, adding that Tehran had "shown flexibility" where it could and that it was "now time for the American side to show flexibility ... on the third issue, that relates to the sanctions."

Restarting nuclear controls on Iran could lift oil sanctions and return as much as 1 million b/d to the tight global markets that has few options for near-term incremental supply.

Iran's Foreign Ministry spokesman Nasser Kanaani said during an Aug. 15 press briefing that Iran had the potential to help meet some of the world's energy needs, especially as geopolitical tensions have strained global oil supplies.

"We believe that removal of the sanctions will not only work in favor of the Iranian government and nation, but also benefit the region and global economy," Kanaani said. "It will be beneficial for energy supply of the European countries too."

'Diplomatic progress'

"Signs of diplomatic progress are greater than at any time since March, but it remains premature to believe a nuclear deal could be within reach," Platts Analytics chief geopolitical advisor Paul Sheldon said.

Sheldon said that comments from Iranian officials "could either be the latest attempt to maintain an appearance of diplomacy while shifting the goalposts, or a sign that the Supreme Leader is ready to accept the best offer."

For the time being, Platts Analytics' reference case assumes the former, "as events from recent months indicate Iran is no longer interested in any deal with the US," Sheldon said, though he acknowledged that Iran's position could shift at any time.

If such a shift were to happen, a deal in the coming weeks would mean full implementation by the end of the fourth quarter, "after which exports could grow by 1 million b/d within three months," Sheldon said.

The Biden administration stepped up efforts to pressure Iran back to the negotiating table to deescalate its progress toward a nuclear weapon and return to mutual compliance with the Joint Comprehensive Plan of Action.

The JCPOA of 2015 set restrictions on Iran's nuclear program in exchange for relief from US sanctions. The Trump administration reimposed sanctions on Iran's oil, petrochemicals, shipping and other sectors in 2018.

But US officials have been skeptical of the Iranian leader's commitment to broker a deal.

"We continue to believe that diplomacy is by far the best, the most effective means by which to constrain verifiably and permanently Iran's nuclear program," State spokesman Ned Price told reporters Aug. 15.

"If Iran is prepared for a mutual return to compliance with the JCPOA, so are we," he said. "If Iran cannot or will not accept a mutual return to full implementation of the JCPOA, we are equally prepared to continue the vigorous enforcement of our sanctions and the imposition of other diplomatic pressure."

No concessions

"There are issues that the Iranians have put on the table that are clearly extraneous to the four corners of the JCPOA," Price said. "Every time they have done that, we have made it very clear that the JCPOA is about one thing and one thing only: it's about Iran's nuclear program." As such, the US is only prepared to negotiate lifting sanctions on Iran's nuclear program, he said.

Price pushed back on reports that the US was considering other concessions, such as de-listing the Islamic Revolutionary Guard Corps as a foreign terrorist organization.

"The only way to achieve a mutual return to compliance with the JCPOA is for Iran to drop further unacceptable demands that go beyond the scope of the JCPOA," Price said. "We have long called these demands extraneous."

Media reports suggesting that sanctions on the IRGC may be relaxed or that a probe into Iran's alleged violations of its Comprehensive Safeguards Agreement under the Non-Proliferation Treaty may be closed were "highly inaccurate," Price said at a press briefing. "We do not plan to relax enforcement of these sanctions. We have not offered to do so in the context of the JCPOA talks."

As for the particulars of the deal on the table now, Price said the US agreed with Borrell's assessment that "what could be negotiated has been negotiated" but that the department would otherwise share its views with the EU privately.

He offered, however, that the US has restored and strengthened its unity with European allies and other partners around the world to forge a broad international consensus regarding the need to deal with Iran's nuclear provocations.

Price noted that the text of the agreement at issue has been out for more than two weeks, giving Iran and other parties time to pose questions and seek further clarity or precision on its provisions.

"I don't want to speculate as to what or how Iran might respond, but I can say that there is a track record here that extends 15, 16 months or so," Price said. "And over the course of those 16 months, Iran has not consistently demonstrated the seriousness of purpose ... [or] that it is steadfastly and sincerely committed to a mutual return to compliance with the JCPOA. Iran here has an opportunity to prove to us but more importantly to prove to the world that it is in fact committed to a mutual return to compliance with the JCPOA."