US-Iran peace agreement in limbo after renewed strikes, sanctions

By Magdalena Del Valle and Sonya Dymova

 

A two-day exchange of airstrikes and the reimposition of US oil sanctions have left the truce President Donald Trump reached with Iran last month in limbo. 

 

In its initial phase, the memorandum of understanding that took effect June 18 was supposed to end all hostilities, provide sanctions relief for Iran and reopen the Strait of Hormuz. It hasn’t delivered any of these objectives in full, and Trump said Wednesday the deal was “over.” Yet it hasn’t been formally scrapped and some of its stipulations are still being observed.  

 

A US official, speaking on condition of anonymity, said Thursday that so-called technical talks between the two sides were continuing and that the US was committed to finding a resolution with Iran.

 

All this highlights the confusion about what comes next in a conflict that’s flared up again without returning to all-out war. The Trump administration hasn’t ramped up bombing to the intensity of the campaign’s early days. Oil prices have jumped this week but remain far short of peaks hit in March. At the same time, there’s little prospect of meaningful discussion on issues like Iran’s nuclear program that were supposed to be addressed in phase two.

 

“The MOU is unraveling,” said Mona Yacoubian, director of the Middle East Program at the Center for Strategic and International Studies. “But I don’t think it will completely collapse, because I don’t think either side has an interest in returning to full conflict.” 

 

Earlier this week, there were expectations — fanned by Qatari mediators and by Trump — that talks could resume as soon as a weeklong funeral for Ayatollah Ali Khamenei was over. As Iran’s former supreme leader was laid to rest Thursday, more than four months after he was assassinated on the first day of the conflict, no party seemed to think that was likely.

 

The US and Iran have each accused the other this week of violating the ceasefire, but the latest clashes and the renewal of Trump’s economic pressure campaign have raised the stakes. 

 

The US Treasury on Tuesday revoked the waiver on sanctioned Iranian oil that it had granted last month, in response to attacks on ships in Hormuz. That move undercut some of the leverage that the US had in negotiations, according to Brett Erickson, managing principal at Obsidian Risk Advisors. 

 

His conclusion: “This MOU, as it is currently written, is dead.” 

‘Waste of Time’

That chimes with Trump’s comments at this week’s NATO summit in Turkey, where he branded Iranian officials as “scum” and said further talks would be a “waste of time.” Still, the president added that his envoys could seek a deal as they see fit. 

 

If further negotiations do take place, they’re likely to result in an accord that’s different from the current MOU, according to Tom Warrick, a senior fellow at the Atlantic Council. 

 

“I don’t know if the memorandum is going to be the basis going forward,” he said. “I imagine both sides are going to insist on clarifying changes that make it indisputable that their side is correct.”

 

Traffic through the Strait of Hormuz came to a near standstill on Thursday. Iran’s insistence that it retains control of the passage is one of many issues on which the two sides remain far apart. US Central Command said Thursday that “Iran does not control the Strait of Hormuz.”

 

Still, the US hasn’t reimposed its own blockade, which was lifted under the terms of the MOU, though Trump hinted on Wednesday it may do so.  

 

If that happens, it would be one signal that the MOU has fallen apart, said Behnam Ben Taleblu, senior director of the Iran program at the Foundation for Defense of Democracies. Others might be new US sanctions or military deployments in the region. 

 

“Until you see these things, expect it to be a ghost operating in the background,” Taleblu said, referring to the MOU.

 

Trump, under fire at home for the war’s impact on gasoline prices as November’s midterm elections draw nearer, has shown little appetite to keep up the military campaign much longer. 

 

“I don’t think it’s going to start again,” he said of the war during this week’s NATO summit. “I think it’s going to go very quickly.”