Will the Iran conflict break the West?

Although media coverage of the summit focused on trade wars, fires in the Amazon, and the looming danger of a “no-deal” Brexit, the discussions about Iran were probably the most consequential. The fate of the 2015 Iran nuclear deal could determine not only whether the world’s most combustible region descends into a nuclear arms race, but also whether the Western political alliance can survive.

In Biarritz, French President Emmanuel Macron opened the way for a US-Iranian détente. And in recent days, the main players in the Iran drama have all pulled back from the brink. The United Kingdom has released the Iranian tanker (Grace 1) that it seized in Gibraltar. And, more important, Trump has expressed a willingness to meet with Iranian President Hassan Rouhani, even suggesting that he would not object to Iran receiving a “short-term line of credit or loan.”

Nonetheless, several factors could derail de-escalation. For starters, the Trump administration remains convinced that the more pressure it puts on Iran (and on America’s European allies), the better. US National Security Adviser John Bolton, in particular, wants to asphyxiate the Iranian economy, and believes that cutting off any lifelines from Europe is the way to do it. He and other US officials will use all means at their disposal to chip away at European unity, with the most obvious pressure point being the UK. Worse, beyond applying economic pressure, some in the US – and in the region – also want to set a trap to lure Iran into a military conflagration.

There is also the problem of Iran’s hardliners, many of whom feel as though they have got nothing from adhering to the nuclear deal, and that the way to build leverage is to become a bigger nuisance. That reasoning has led Iran’s leaders to dial up its disruptive activities in a number of theatres, not least by seizing a British tanker in the Strait of Hormuz last month (they, too, have noticed that the UK is Europe’s weak link).

Iran’s increasing aggressiveness has already raised hackles in Israel, which is reportedly targeting Iranian assets in Iraq (having already launched strikes against Iranian forces in Syria). The danger now is that Iran or its proxies in the Middle East will misread the situation and cross a red line.

Iran has been understandably frustrated by Europe’s slow progress in launching Instex, a bartering mechanism designed to allow for some trade between Europe and Iran despite US sanctions. But those in Iran who claim they have got nothing from Europe are simply wrong. If the European Union were to abandon its current approach and join Trump in squeezing Iran, they would certainly notice the difference. In fact, by continuing its policy of escalation, Iran risks losing the moral high ground, and thus the support of Europeans who have gone out on a limb to decouple their Iran policy from that of the US.

Europe’s ability to maintain support for the Iran deal in defiance of US pressure has surprised many. Even the British government has adhered closely to the EU position so far. But that could change. If Iran were to seize another British ship and hold UK citizens hostage, it could prompt Johnson to break from the EU and adopt the Trump administration’s stance.

Given this risk, it is disappointing that France, Germany, and the UK have not launched a joint European mission in the Persian Gulf, so that an attack on one would be an attack on all. If the UK breaks from the EU line, Germany will be the next target for hardliners (in both Iran and the US) to peel off. In the meantime, the US may ramp up its diplomacy in central and eastern Europe, where it has a higher chance of pulling EU member states over to its side.

To head off these risks, Macron is asking Trump to consider sanctions exemptions if Iran complies once more with the nuclear deal by curtailing its enrichment activities and opens the door to further talks with the West. He has pointed out that Trump’s leverage will diminish over time as Iran builds its stockpile of enriched material and develops ever more ways to circumvent US sanctions. At this point, further escalation by the US could push the Iranians away from the negotiating table for good, raising the possibility of a military confrontation in the middle of Trump’s re-election campaign. In this context, it is worth remembering that in his first campaign, Trump promised an end to America’s endless wars and pointless adventures abroad.

The Europeans must also persuade the Iranians not to overestimate their own power. Macron’s proposal for a new credit line to Iran could strengthen the position of Iranian moderates, but his credibility in Iran will be diminished if the Europeans cannot get Instex up and running. The goal, in any case, should be to encourage Iran to hang on until after the US presidential election in November 2020. Europe should continue to offer financial support, but it also must make clear that further Iranian attacks on European interests could force the EU to adopt the US’s containment strategy.

Finally, Europeans need to keep a close eye on the Persian Gulf. Even if they are not going to organise a joint naval force, they should be developing a de-escalation strategy in case the US or Iran provokes a confrontation. Organising a naval conference that includes Iran could be a prudent first step.

In broad terms, this is the agenda that Macron will be pushing in the run-up to the United Nations General Assembly meeting in late September. If the strategy succeeds, the Biarritz summit may turn out to be the first successful G7 gathering of Trump’s presidency (whether he knows it or not).

This article was originally published on 29 August by Project Syndicate.