In July 2015, the Joint Comprehensive Plan of Action (JCPOA), also known as the Iran Nuclear Deal, made headlines across the globe as a landmark historical agreement between extreme opponents. It was a signature foreign policy achievement of President Barack Obama's second term. The accord came after months of preparation and two weeks of final intensive discussions in Vienna, and with eight parties involved, the final result was an agreement with five annexes.
The deal was intended to limit Tehran's nuclear ability in return for lifting international oil and financial sanctions. It laid out a lengthy process, spanning over 15 to 25 years, that would be supervised by an eight-member committee, including Iran, the U.S., the United Kingdom, France, Germany, Russia, China, and the European Union. However, the deal has proved challenging to keep intact. In May 2018, President Donald Trump announced that the U.S. would be pulling out of the deal and issuing fresh sanctions against Iran.
However, more recently, President Joe Biden has signaled his willingness to rejoin the agreement, as long as Tehran resumes complying with the terms of the original agreement.
- The Iran nuclear deal was designed to curb Iran's ability to produce nuclear weapons, in exchange for the removal of sanctions on Iran.
- In May 2018, former U.S. President Donald Trump announced that the U.S. would be pulling out of the deal and issuing sanctions on Iran.
- After then-President Trump ordered the killing of Iranian General Qasem Soleimani in early 2019, Iran announced its withdrawal from the nuclear deal.
Iran Nuclear Deal Background
Based on the revelations of an Iranian exile group in 2002, Iran was suspected of having nuclear facilities. Following inspections by the International Atomic Energy Agency (IAEA) and subsequent discoveries, Iran continued to proceed with nuclear developments despite international opposition. In 2006, the United Nations imposed sanctions on Iran, which were followed by similar actions from the U.S. and the EU. Bitter confrontations then broke out between Iran and the world powers.
These sanctions—primarily on Iran's oil business, weapons sales, and financial transactions—had severely hurt Iran’s economy. As one of the largest producers of crude oil, prices went through a volatile period as the outcome was largely unknown.
The Parties Involved
The deal was negotiated between Iran and a group of counterparts that included the U.S., Russia, the U.K., Germany, France, China, and the European Union (EU).
The supporters of the nuclear deal affirm benefits, which include the best-possible guarantee from Iran that it will refrain from producing a nuclear arsenal. It was, at the time, an important step toward establishing peace in the Middle East region, particularly in the context of ISIS and the role of oil in Middle East economies.
The Main Points
To make nuclear bombs, the uranium ore mined from the earth needs enrichment to either uranium-235 or plutonium. Uranium ore mined from the earth is processed via devices called centrifuges to create uranium-235. Uranium ore is processed in nuclear reactors, which transform it into plutonium.
Under the deal, Tehran would reduce the number of centrifuges to 5,000 at the Natanz uranium plant—about half the number at the time. Nationwide, the number of centrifuges would reduce from 19,000 to 6,000. The enrichment levels would be brought down to 3.7%, which was much lower than the 90% needed to make a bomb. The stockpile for the low-enrichment uranium would be capped to 300 kilograms for the next 15 years, down from the then 12,000 kilograms.
All these measures served to restrict Iran's capability to make a nuclear bomb and would ensure nuclear power usage is limited to civilian use only.
Next Steps and Timeline
As the deal was finalized, a UN Security Council resolution was agreed upon.
By August 15, 2015, Iran submitted written responses to the questions raised by the International Atomic Energy Agency (IAEA) about its nuclear program and developments. Additionally, it allowed monitoring of its facilities by IAEA inspectors on or before October 15, 2015.
Removal of Sanctions
First, the oil embargo that prevented the import of oil from Iran was removed, which was not without its effects. The U.S. and EU lifted oil- and trade-related sanctions. Foreign companies began to purchase oil from Iran; U.S. companies located outside the United States were authorized to trade with Iran; and imports of selected items from Iran were permitted, which had a particular effect on international business.
Simultaneously, sanctions on Iran’s banking and financial systems were dropped. It enabled the immediate release of around $100 billion currently lying frozen in Iranian bank accounts overseas.
Immediately after the announcement, government officials from major European countries began visits to Iran to explore business opportunities.
Some of the main challenges faced by Iran during the sanction period were Iran's shrinking GDP, high inflation (over 35% in 2013), and the nation being cut off from world economic systems. All such economic challenges drastically improved after the agreement.
Lifting sanctions would allow the movement of huge supplies of oil from Iran, which was thought to be sitting on large stockpiles due to years of imposed sanctions. International oil companies like France’s Total and Norway’s Statoil (now Equinor) operated in Iran for years before sanctions were imposed, changing the tide for those countries and other top oil producers in the world.
European car manufacturers like Peugeot and Volkswagen were market leaders in Iran prior to the sanctions. Although a few sectors like auto, oil, and infrastructure had significant interest from foreign companies in the pre-sanction era, the reality was that foreign businesses had limited presence in Iran since the 1979 Revolution. In essence, the Iranian markets had remained largely unexplored by international businesses across many other industry sectors.
Former U.S. President Barack Obama claimed that the deal would make the U.S. and the world a safer place. However, concerns remained.
Challenges included administrating and monitoring the atomic facilities and developments in Iran. Complete awareness was required about the existing labs, establishments, underground sites, research centers, and military bases associated with nuclear developments. Though Iran agreed to provide the IAEA with higher levels of information and deeper levels of access to all nuclear programs and facilities in the country, the picture remained murky.
Opposition to the Iran Nuclear Deal
The deal, although welcomed by a larger group of nations across the globe, also had opposition from a few prominent world leaders. Israeli leader Netanyahu said the deal "paves Iran's path to the bomb." His vehement opposition to the deal came on the basis of Iran’s history of being a nuclear-capable challenge for the Middle East region.
Additionally, Netanyahu said the deal was a platform to fund and nurture a nuclear-capable, religious-extremist country, saying a strengthened Iran could hinder peace and security in the region.
Former President Donald Trump and Iran
After Donald Trump was elected president in November 2016, proponents of the deal feared the agreement, which they saw as a win for world peace, would be in jeopardy.
In May of 2018, President Trump announced that the U.S. would pull out of the deal and by the end of the year had reinstated sanctions on Iran. European countries, including Germany, France, and the U.K. disagreed with the sanctions.
As a result, Iran's economy struggled, leading to protests in the streets. Iran responded when Iranian President Hassan Rouhani announced that the country was rolling back some of the restrictions that had been previously agreed to under the 2015 deal.
Iran would stop complying with the caps for stockpiles of enriched uranium. The Iranian president also announced the country would also halt any sales of surplus supplies overseas.
In early 2019, President Trump ordered the killing of General Qasem Soleimani, who was one of Iran's top military leaders. In response, Iran announced it would no longer comply with the nuclear deal that President Obama had signed in 2015.
In May 2019, Iran's Atomic Energy Organization stated that they would quadruple the production or output of low-enriched uranium, which was later confirmed by the IAEA as reported by BBC news.
President Joe Biden and Iran
President Joe Biden is said to be intent on restoring the 2015 nuclear agreement with Iran. According to officials who are working on the deal, Biden and his aides are going through the process of reviewing each sanction that former U.S. President Donald Trump put in place against Iran. (Towards the end of Trump's term, the former President levied more than 700 sanctions against the country.)
Ali Vaez, of the International Crisis Group (ICG), was the senior advisor to Robert Malley, Biden's chief negotiator, when Malley was head of the ICG. Vaez has said that "...sanctions that are justified and not inconsistent with the JCPOA, like those that targeted human rights violators in Iran or those that penalized Iranians involved in cyberattacks against the U.S., will stay in place.”
In recent months, Iran has produced nuclear material that could be used for bombs and has increased its enrichment levels. Both of these actions are violations of the original pact and if continued, would prevent any sanctions against the country from being lifted.
The Bottom Line
The pros and cons of such a landmark deal were hotly debated. Most views, claims, and allegations were often politically tuned. European leaders still hold out hope that a deal can be reimplemented in an effort to constrain Iran's nuclear ambitions. However, for the time being, it appears that the Iran nuclear deal is on life support.