China and India seen as Europe’s last hope to save Iran deal
10 May 2019

The European Union will defend the Iran nuclear accord despite Tehran’s decision to backtrack on its commitments in response to U.S. sanctions, diplomats believe, but European powers expect it to collapse without a deal to sell Iranian oil to China or India.

Britain, France and Germany, which signed the 2015 deal along with the United States, China and Russia, are determined to show they can compensate for last year’s U.S. withdrawal from the accord, protect trade and still prevent Tehran from developing a nuclear bomb.

But with Iran’s economy dependent on crude exports that are traded in U.S. dollars, a promised European trade channel to bypass American sanctions has proved complicated, is not yet operational, and may never be able to handle oil sales.

“This situation now risks deteriorating, but it will be step by step and not a collapse all in one go,” said a senior European diplomat. A French diplomat talked of a “negative spiral” in which trade in food and medicines was simply not enough, while another European envoy spoke of Iran’s “phased exit” from the deal.

The Iran accord, one of the West’s biggest foreign policy achievements until U.S. President Donald Trump pulled out in May 2018, lifted punishing United Nations’ sanctions on Iran in return for Iranian compliance with the deal.

By Robin Emmott, John Irish and Paul Carrel, Reuters, 10 May 2019

Read more at Reuters

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