(Bloomberg) -- Iran and world powers are closing in on an agreement detailing the main steps needed to resolve a 12-year standoff over the Islamic Republic’s nuclear program, giving themselves three months to overcome remaining differences.
Though any understanding is likely to fall short of the full resolution of every issue dogging the dispute that both sides had sought, a statement may be released later Tuesday, according to two officials involved who spoke on condition they not be named in line with diplomatic protocol. The parties would then have until June 30 to draft a detailed technical accord.
An agreement can be reached “as long as none of the participants at the talks raise their stakes at the last moment,” Russian Foreign Minister Sergei Lavrov said at a press conference before rejoining the negotiations in Lausanne, Switzerland. One sticking point remained the lifting of United Nations sanctions as demanded by the Iranians, according to an official involved in the talks.
As negotiations continued, Swiss officials were preparing a venue at a Lausanne university for any signing ceremony. Police officers at the site confirmed it was being readied for the conclusion of the Iran negotiations.
The agreement on main principles would be less than what was sought by President Barack Obama. He needs to sell any deal to a skeptical Congress and American public to get support for a 10-to 15-year accord that would restrict and monitor Iran’s nuclear activities in exchange for relief from crippling sanctions on banking, oil and other trade.
Oil Decline
It would though allow his administration to say it met a self-imposed March 31 deadline for a political understanding as it seeks to head off new sanctions on Iran proposed by Congress. The president says such a move could derail talks.
The group of six powers -- China, France, Germany, Russia, the U.K. and the U.S. -- is attempting to ensure Iran’s program is peaceful, amid charges over the years that the nation is seeking to obtain
nuclear weapons. Iran denies the claims.
Oil fell as signals emerging from Lausanne suggested some form of accord was expected. Futures dropped as much as 2.9 percent in New York and 2.8 percent in London.
If a final deal is reached by June 30, Iran could add more crude to an oversupplied oil market where prices have fallen more than 50 percent since June. Iran has stored excess crude on tankers for the past 2 1/2 years as restrictions deterred buyers, according to the International Energy Agency. The country now exports about 1 million barrels of crude per day, down from 2.5 million in mid-2012, IEA data show.
Remaining Hurdles
German Chancellor Angela Merkel, speaking at a press conference with French President Francois Hollande in Berlin, said that while she hopes an “acceptable agreement” can be reached, “there still have to be tough negotiations.” Hollande said “France wants an agreement but a good agreement -- not an accord for the sake of an accord.”
How to relax or remove UN sanctions on energy, banking and shipping, among other restrictions on trade and investment, has hindered progress throughout the talks.
Lavrov said at the Moscow briefing that “there are different formulas, either to lift them or first to suspend them” under discussion. “The point is that in practice the sanctions should no longer be in effect and shouldn’t prevent the development of legitimate economic and trade interests.”
An Iranian website associated with conservatives who oppose major concessions said a new UN resolution is being discussed that would remove sanctions on Iran after the Persian Gulf country had met certain conditions.
Ending Isolation
There are differences, though, over how that would be worded, according to the website, Irannuc.ir. The U.S. and France want a snapback mechanism that automatically reimposes the curbs should Iran violate the agreement; Iran, Russia and China want any such disagreement to go to arbitration, it reported.
Other unresolved issues involve the length of any agreement, the extent of Iran’s research and development and Iran’s stockpile of enriched uranium, the website reported.
A framework understanding would be a first step toward ending Iran’s economic isolation and allowing the country with the world’s fourth-biggest oil reserves to export freely after a final agreement is reached by June 30, once Iran proves compliance with initial restrictions.
High Stakes
A failure in talks would have been a blow to Obama, who has backed two years of negotiations with Iran despite domestic opposition. Republicans and many Democrats in Congress say they agree with Israeli Prime Minister Benjamin Netanyahu’s argument that the emerging accord is dangerous.
The stakes are also high for Iranian President Hassan Rouhani, elected as a reformer to fix an economy whose GDP and currency were battered under wide-ranging economic sanctions. Rouhani said the removal of penalties must be “a fundamental part of this agreement” and that it was “the other side’s turn to take the final steps,” the Fars news agency reported Sunday.
Though any understanding is likely to fall short of the full resolution of every issue dogging the dispute that both sides had sought, a statement may be released later Tuesday, according to two officials involved who spoke on condition they not be named in line with diplomatic protocol. The parties would then have until June 30 to draft a detailed technical accord.
An agreement can be reached “as long as none of the participants at the talks raise their stakes at the last moment,” Russian Foreign Minister Sergei Lavrov said at a press conference before rejoining the negotiations in Lausanne, Switzerland. One sticking point remained the lifting of United Nations sanctions as demanded by the Iranians, according to an official involved in the talks.
As negotiations continued, Swiss officials were preparing a venue at a Lausanne university for any signing ceremony. Police officers at the site confirmed it was being readied for the conclusion of the Iran negotiations.
The agreement on main principles would be less than what was sought by President Barack Obama. He needs to sell any deal to a skeptical Congress and American public to get support for a 10-to 15-year accord that would restrict and monitor Iran’s nuclear activities in exchange for relief from crippling sanctions on banking, oil and other trade.
Oil Decline
It would though allow his administration to say it met a self-imposed March 31 deadline for a political understanding as it seeks to head off new sanctions on Iran proposed by Congress. The president says such a move could derail talks.
The group of six powers -- China, France, Germany, Russia, the U.K. and the U.S. -- is attempting to ensure Iran’s program is peaceful, amid charges over the years that the nation is seeking to obtain
nuclear weapons. Iran denies the claims.
Oil fell as signals emerging from Lausanne suggested some form of accord was expected. Futures dropped as much as 2.9 percent in New York and 2.8 percent in London.
If a final deal is reached by June 30, Iran could add more crude to an oversupplied oil market where prices have fallen more than 50 percent since June. Iran has stored excess crude on tankers for the past 2 1/2 years as restrictions deterred buyers, according to the International Energy Agency. The country now exports about 1 million barrels of crude per day, down from 2.5 million in mid-2012, IEA data show.
Remaining Hurdles
German Chancellor Angela Merkel, speaking at a press conference with French President Francois Hollande in Berlin, said that while she hopes an “acceptable agreement” can be reached, “there still have to be tough negotiations.” Hollande said “France wants an agreement but a good agreement -- not an accord for the sake of an accord.”
How to relax or remove UN sanctions on energy, banking and shipping, among other restrictions on trade and investment, has hindered progress throughout the talks.
Lavrov said at the Moscow briefing that “there are different formulas, either to lift them or first to suspend them” under discussion. “The point is that in practice the sanctions should no longer be in effect and shouldn’t prevent the development of legitimate economic and trade interests.”
An Iranian website associated with conservatives who oppose major concessions said a new UN resolution is being discussed that would remove sanctions on Iran after the Persian Gulf country had met certain conditions.
Ending Isolation
There are differences, though, over how that would be worded, according to the website, Irannuc.ir. The U.S. and France want a snapback mechanism that automatically reimposes the curbs should Iran violate the agreement; Iran, Russia and China want any such disagreement to go to arbitration, it reported.
Other unresolved issues involve the length of any agreement, the extent of Iran’s research and development and Iran’s stockpile of enriched uranium, the website reported.
A framework understanding would be a first step toward ending Iran’s economic isolation and allowing the country with the world’s fourth-biggest oil reserves to export freely after a final agreement is reached by June 30, once Iran proves compliance with initial restrictions.
High Stakes
A failure in talks would have been a blow to Obama, who has backed two years of negotiations with Iran despite domestic opposition. Republicans and many Democrats in Congress say they agree with Israeli Prime Minister Benjamin Netanyahu’s argument that the emerging accord is dangerous.
The stakes are also high for Iranian President Hassan Rouhani, elected as a reformer to fix an economy whose GDP and currency were battered under wide-ranging economic sanctions. Rouhani said the removal of penalties must be “a fundamental part of this agreement” and that it was “the other side’s turn to take the final steps,” the Fars news agency reported Sunday.
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