Iran’s chief nuclear negotiator Ali Bagheri Kani (left) leaves the Coburg Palais, the venue of the Joint Comprehensive Plan of Action (JCPOA), after his meeting with Deputy Secretary General of the European External Action Service (EEAS) Enrique Mora, in Vienna on March 11, 2022. Image Credit: AFP

Vienna: World powers and Iran suspended their efforts to revive the 2015 nuclear accord, reigniting a crisis that’s set to roil already surging oil markets.

A pause in the Vienna talks was required due to “external factors,” European Union foreign policy chief Josep Borrell said on Twitter, without elaborating. Borrell said the sides had come very close to agreement but didn’t say when — or if — the negotiations would be able to resume.

The rupture follows escalating tensions between the Kremlin and the White House. Russia warned on Saturday that it wanted US guarantees that sanctions imposed over its attacks on Ukraine wouldn’t affect its planned partnership with Iran.

Oil prices briefly extended gains on the break in negotiations as traders discarded cautious expectations that the US would eventually lift its sanctions on Iran’s economy and ease an effective blockade on the Opec member’s oil exports.

Pause wasn’t necessarily the end of the road

US and European officials had warned for weeks that the window for a deal was closing, urging an agreement on a handful of outstanding issues.

Iran’s Foreign Ministry spokesman Saeed Khatibzadeh said the pause wasn’t necessarily the end of the road, and could provide momentum to resolve the outstanding issues.

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The US and its European and regional allies must now decide how they respond if Iran continues to advance a nuclear programme that has already enriched uranium to just below the level needed for atomic weapons.

Absent the deal, Iran’s nuclear work has been racing ahead, with its engineers threatening to make the original accord obsolete because of their new advances.

International Atomic Energy Agency inspectors reported last week that Iran’s stockpile of uranium enriched to 60% purity rose more than fourth fifths in the last three months.

Series of attacks

The 2015 nuclear deal unraveled after then-US President Donald Trump reimposed sanctions almost four years ago. Iran responded by escalating its uranium enrichment way beyond limits set by the accord. The standoff fuelled conflicts in the Middle East and a series of attacks on shipping in waterways key for global trade.

After Vladimir Putin ordered his forces into Ukraine, fresh barriers to resurrecting the accord arose.

“Undoubtedly the war in Ukraine has made it more difficult to get an agreement,” said Irish Foreign Minister Simon Coveney, who helped facilitate the talks, this week. Diplomats had “been trying to push for a deal before Russia’s conflict in Ukraine happened because we knew that it would create a lot of complexity.”

Russia weighed in with its new condition just hours after the head of the world’s nuclear watchdog announced from Tehran that one of the last major hurdles to a deal had been cleared. Up until that moment, diplomats had said on and off the record that a deal could be announced within days.

In Vienna, Moscow’s envoy to the talks sought to spread the blame for Friday’s suspension. “The conclusion does not depend on Russia only,” Mikhail Ulyanov said at a briefing. “There are others that need to settle their issues among themselves.”

As expectations of a breakthrough diminished this week, both the US and Iran said lingering disagreements over the scope and timing of sanctions relief looked difficult to overcome. Sticking points have also included Iran’s demand that the US guarantee it would never again leave the pact.

Regardless of Moscow’s stance, EU officials said a deal to salvage the accord could still have been reached if Tehran and Washington had been able to compromise.

Political vacuum

China’s envoy Wang Qun said negotiations couldn’t be conducted under a “political vacuum” and that all sides’ demands needed to be considered.

Russia’s demand initially angered Tehran and appeared to help it and Washington move towards agreement on the few remaining thorny issues, diplomats said.

But a sudden volley of public comments by Iranian officials including Supreme Leader Ali Khamenei on Thursday suggested the wind had turned.

European negotiators from France, Britain and Germany had already left a week ago as they believed they had gone as far as they could and it was now up to the United States and Iran to agree on the outstanding issues.

“We are at the level of negotiating footnotes,” the EU official said.

He said issues such as which sanctions the United States would lift had been agreed, although how they would lifted was still under discussion.

Still a clear path to reviving the deal

“I don’t think it will take much time to finalise the text when come here again, but the question is when?” The negotiations in Vienna have limped on with just a fraction of the number of daily meetings that were taking place in previous weeks. Four Western diplomats had said the talks were all but finalised until Russia made its demands.

“I think there’s still a clear path to reviving the deal given that the US and Iran appear to be on the same page,” Henry Rome, Iran analyst at consultancy Eurasia group, said.

While Iran’s economy has remained surprisingly resilient to US sanctions — even as it was struck down by the worst coronavirus outbreak in the Middle East — unrest and protests have become increasingly frequent and the country’s clerical leadership will be wary of fresh outbreaks of dissent in response to the deal’s collapse.

Enrique Mora, the European Union envoy charged with coordinating the talks, said that diplomats were pausing in order to “maintain a good spirit.”

“It’s better to pause and I will be working obviously with all delegations to overcome this situation, the sooner the better, and come back and end our negotiations successfully,” he told reporters outside the Palais Coburg hotel where the talks have been taking place in Vienna.