Insider news & Analysis in Iran

By INU Staff
INU - On Sunday, a long-anticipated meeting took place in Doha among representatives of OPEC countries plus non-OPEC oil producing nations including the Russian Federation. Though ultimately unsuccessful, the event was meant to lead to a broad-based agreement on freezing or reducing participants’ oil output as part of an effort to stabilize prices that are still recovering from a 12-year low that they reached in January.

Despite the fact that Saudi Arabia, Russia, Venezuela, and Qatar had already agreed among themselves to freeze output at January’s levels, the prospects for success of the Doha meeting came into question recently, especially amidst conflict between Saudi Arabia and Iran regarding whether the latter would participate.

The Iranians had previously expressed their intentions to sell oil at the highest achievable level in order to reclaim market share lost under economic sanctions related to the Iranian nuclear program. The Saudis, meanwhile, had indicated that they would not concede to a freeze agreement unless all relevant states including Iran participated as well.

That outcome proved to be unattainable even before the meeting convened. The day before, Iran elected to cancel its plans to attend, according to the Associated Press. It thereby acted in accordance with its predetermined non-cooperation, as opposed to publicly arguing the point and exposing itself to Arab counter-arguments.

Russia, Kuwait, and some other countries had expressed hope that the agreement could go ahead even in absence of full participation, and disagreement on this point reportedly contributed to a discordant Doha meeting. Saudi Arabia and its supporters did not change their position on Iranian participation however, and the gathering ended without an agreement, leading the Saudis to promise that they would cease to impose limits on their oil exportation.

Presumably, the main purpose of a Saudi increase in oil output under these circumstances will be to interfere with Iran’s efforts to recover its own oil economy and reclaim market share, respective to its regional competitors.

There are certainly economic components to such Saudi decisions, but the disagreement an output freeze underscores the political and diplomatic conflict between the two traditional Middle Eastern rivals. Relations between Saudi Arabia and Iran began to particularly degrade in January when the Saudi execution of a dissident cleric led to a flare-up of sectarian tensions and the storming of the Saudi embassy and consulate by Iranian mobs.

In the aftermath, the Saudis severed diplomatic ties with Tehran, prompting Saudi partners in the Persian Gulf region and beyond to follow suit. The failure of the Doha talks apparently undercuts whatever hope might have existed for reconciliation. And in light of Iran’s imperial activities and the close connections among the Gulf Arab states, it is certain that many policymakers will hold Iran responsible for that failure and for the persistence of regional discord.

The Saudis and their partners raised related issues last week during a meeting of the 57-member Organization of Islamic Cooperation. In that case, Iran did follow through on its plans to attend, but Iranian President Hassan Rouhani and Foreign Minister Javad Zarif cancelled their attendance at the meeting’s last session in protest over remarks decrying Iran’s regional interference and support for terrorism.

It is not clear that such protests have done much to generate sympathy among states that are caught between the global influence of Riyadh and Tehran. Among most Arab states, the effect seems to be quite the contrary. On Monday, one day after the failed Doha meeting, the Wall Street Journal reported that Jordan had recalled its ambassador to Tehran, citing concerns over Iranian interference in areas like Syria and Yemen.

While the proximity of these two events may be coincidental, it may also suggest that Jordan was hedging its bets concerning Iran policy until after the Islamic Republic had had a chance to reconcile with its regional adversaries.

This is not to say that Iran hasn’t invited such reconciliation, but when it has done so it has done so on its own terms. Fox News reports that Sunday, as well as marking the Doha oil meeting, was also Army Day in Iran. Iranian officials and military personnel celebrated with parades and the unveiling of new military equipment, and televised speeches boasting of the strength of the Iranian armed forces.

Fox News indicates that President Rouhani’s speech on this topic simultaneously emphasized the idea that the Iranian military is no threat to its neighbors and also that it is a formidable force, capable of standing against supposed threats from the US and Europe. Such commentary appears very much in line with the Iranian regime’s core identity and aspiration to global leadership against Western powers.

In light of this tone in Army Day speeches – criticizing the West and speaking well of regional unity – it is arguably ironic that relations between Iran and the Gulf Arab states continue to degrade while major forces in the West continue to push for rapprochement and expanded trade with the Islamic Republic.

As an example of this, the Washington Free Beacon reported on Monday that European Union officials are joining with Iran in pushing for the US to permit Iran access to American financial markets. In this sense, they are specifically pushing back against American lawmakers who see this is as threat to the last important bits of leverage that they have over an Iranian regime whose behavior is fundamentally unchanged. Such advocacy also threatens to undermine assurances from the White House and the Treasury Department that this leverage would remain intact even under the nuclear deal that was implemented in January.

Such developments are just some symptoms of the eagerness that some European businesses and government officials have shown to the prospect of regaining access to Iranian oil and import markets. This eagerness was on display in a number of state visits that have already taken place between Iran and EU countries. Business delegations visited Iran from the EU even before the nuclear deal was implemented, some even coming from France, which had developed a reputation for holding a particularly hard line on Iran in the nuclear negotiations.

France was also one of the first countries to host President Rouhani and to implement post-sanctions business agreements, including the resumption of Air France commercial flights to the Islamic Republic. The first such flight touched down in Iran on Sunday, according to Conde Nast Traveler. The flight brought along another 15-member French delegation including Transport Minister Alain Vidalies.

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