UANI on the Nuclear Deal

UANI on the Nuclear Deal

United Against Nuclear Iran has put together this awesome packet regarding what the deal will do to the nuclear program (Hint: Not Much).  Take a look and get an idea of what we’re dealing with.

Geneva Interim Agreement Tracker-UANI

On November 24, 2013 the P5+1 and Iran struck an agreement to freeze progress on certain elements of Iran’s nuclear program in exchange for sanctions relief. Following nearly two months of additional negotiations, on January 12, 2014 the parties announced that the agreement would commence on January 20, 2014 and conclude on July 20, 2014. The interim agreement is intended to build confidence between the P5+1 and Iran and provide time for additional negotiations that will ultimately lead to a final comprehensive agreement – within “no more than one year” – that resolves all outstanding concerns about Iran’s nuclear program. UANI is methodically tracking how the provisions of the agreement and obligations of the parties are being implemented and interpreted by each side. As part of this effort UANI is tracking how the agreement is affecting Iranian business activity and trade as measured by a number of key economic indicators, as well as its impact on the international sanctions regime.

This comprehensive and objective tracking is critical given that Iran and the United States have respectively characterized the interim agreement in a starkly different light. While Iranian President Hassan Rouhani boasted that the Geneva agreement “means the surrender of the big powers before the great Iranian nation,” President Barack Obama said, “We have made concrete progress. I welcome this important step forward, and we will now focus on the critical work of pursuing a comprehensive resolution.” In regards to sanctions relief and enforcement, Rouhani said, “The sanctions regime will begin to shatter with the (implementation) of this agreement,” while David Cohen, the U.S. Treasury Department official tasked with enforcing the U.S. sanctions program stated, “I am confident that the sanctions pressure on Iran will continue to mount. Iran will be even deeper in the hole six months from now, when the deal expires.”

Analysis of the deeply conflicting visions of the respective parties reveals the near-impossibility of achieving the compromise necessary to reach a final comprehensive deal. For example, while President Obama says Iran doesn’t need the underground fortified Fordow facility, the Arak heavy-water reactor, or advanced centrifuges “in order to have a limited, peaceful program,” Rouhani has said that it is “100 percent” a “red line” for Iran to dismantle any nuclear facilities. Finally, as evidenced below, the substantial benefits awarded to Iran under the agreement cast doubt on whether the P5+1 is retaining sufficient sanctions leverage to achieve a final agreement which denies Iran the ability to retain an industrial-scale nuclear infrastructure and a rapid nuclear weapons breakout capability.

Month 1 Day 4 of the Six Month Geneva Interim Agreement


Nuclear Breakout Timeline

How Quickly Could Iran Make the Bomb?

Based on the status of Iran’s nuclear program in August 2013, the Iranian regime could build a nuclear weapon in as little as 1.0-1.6 months, according to the Institute for Science and International Security (ISIS). After the interim agreement was struck in Geneva, the U.S. Secretary of State touted, “We now have a mechanism by which we are going to expand the amount of time in which [the Iranians] can break out [to obtain nuclear capability] rather than narrow it.” In reality, the accord does little to push back Iran’s breakout time. ISIS estimates that even if Iran completely fulfilled its obligations under the deal (some of which will not be fulfilled until months into the agreement), Iran’s breakout time would lengthen to only 1.9-2.2 months.


Iran’s Continued Nuclear Progress

President Obama has hailed the interim nuclear agreement as marking “the first time in a decade that the Islamic Republic of Iran has agreed to specific actions that halt progress on its nuclear program and roll back key parts of the program.” He later remarked, “Beginning January 20th, Iran will for the first time start… dismantling some of the infrastructure that makes such enrichment possible…” Iranian officials, however, have rejected the President’s assertions. Iranian Deputy Foreign Minister Abbas Araghchi said, “I can say definitively that the structure of our nuclear program will be exactly preserved. Nothing will be put aside, dismantled or halted.”

In reality there are a number of ways in which the Iranian regime will continue to develop its nuclear program during the interim agreement, as outlined below.

Arak Heavy Water Reactor

Iran will continue to perform excavation and civil construction work at this facility which is considered a prime proliferation threat.

Research & Development

Iran will continue to perform ongoing R&D activities that preceded the agreement.

Development of Advanced Centrifuges

As part of its ongoing R&D, Iran will continue “experimenting with a range of test centrifuges at the Natanz pilot scale facility, including the IR-1, IR-2m, IR-4, and the IR-6.” The advanced centrifuges are multiple times faster than Iran’s first-generation models, and if put into operation, would reduce Iran’s breakout time to only a matter of weeks, if not days.

Long-Range Ballistic Missile Testing

Iran will continue long-range ballistic missile testing, which is a central component for a modern nuclear weapons program as the delivery mechanism of the warhead. December 13, 2013 was the “the latest demonstration of the country’s missile capabilities,” when Iran performed a space launch vehicle test.

Final Agreement: A Deep Divide

The purported goal of the interim agreement is to pave the way for a final agreement that resolves all outstanding concerns about Iran’s nuclear program. Thus far, the two sides have articulated deeply conflicting visions of such an accord that appear near-impossible to reconcile. The Iranian regime has already laid out maximalist positions that question whether the regime is prepared to negotiate in good faith and ultimately rollback elements of its nuclear program.




Obama: “They certainly don’t need a heavy-water reactor at Arak in order to have a peaceful nuclear program.”

Arak Heavy Water Reactor

Araghchi: “Your actions and words show you don’t want us to have the Arak heavy water reactor which means you want to deprive us of our rights. But you should know that it is a red line which we will never cross… We want to have more heavy water reactors in future.”

Obama: “Now, in terms of specifics, we know that they don’t need to have an underground, fortified facility like Fordo[w] in order to have a peaceful nuclear program.”

Fordow Fortified Underground Enrichment Facility

Rouhani: It is “100 percent” a “red line” for Iran to dismantle any nuclear facilities.

Obama: “They don’t need some of the advanced centrifuges that they currently possess in order to have a limited, peaceful nuclear program.”

Advanced Centrifuges

Aragchi: “All research into a new generation of centrifuges will continue.”

Obama: “And so the question ultimately is going to be, are they prepared to roll back some of the advancements that they’ve made that would not justify — or could not be justified by simply wanting some modest, peaceful nuclear power, but, frankly, hint at a desire to have breakout capacity and go right to the edge of breakout capacity.”

Limitation on the Size of Iran’s Enrichment Program

Araghchi: “We will in no way, never, dismantle our [nuclear] centrifuges.”

Rouhani: “So in the context of nuclear technology, particularly of research and development and peaceful nuclear technology, we will not accept any limitations. And in accordance with the parliament law, in the future, we’re going to need 20,000 mega watts of nuclear produced electricity and we’re determined to obtain the nuclear fuel for the nuclear installation at the hands of our Iranian scientists. And we are going to follow on this path… Not under any circumstances” will we destroy any centrifuges.

Sanctions Relief

The views on sanctions relief between the U.S. and the Iranian government are also highly incongruous. The White House has described the sanctions relief provided in the agreement as “economically insignificant” and insisted that “Iran’s economy will also continue to suffer because the core architecture of U.S. sanctions—especially our potent oil, financial and banking sanctions—remains firmly in place.” David Cohen, the U.S. Treasury Department official tasked with enforcing the U.S. sanctions program declared, “I am confident that the sanctions pressure on Iran will continue to mount. Iran will be even deeper in the hole six months from now, when the deal expires.” In comparison, leading Iranian officials have boasted that with this agreement, the structure of the international sanctions regime is falling apart and that the Iranian economy is progressively improving. Following the January 12 agreement on the implementation of the accord, Rouhani pronounced, “The Geneva agreement means the wall of sanctions has broken.”

In terms of total estimated value of the sanctions relief provided in the agreement, the White House estimates that Iran stands to receive $6 billion to $7 billion. Iran analysts, however, have anticipated that the true value of the sanctions relief could be more than $20 billion.

Furthermore, the momentum of an ever strengthening international sanctions regime was halted following Rouhani’s election in July 2013 in an apparent effort by the U.S. to court the regime and set a tone for renewed negotiations. The effect of this halt, and even reversal, in momentum was significant as measured by the appreciation of the rial and growth in the Tehran Stock Exchange since June 2013. This process only accelerated in the run-up to the signing of the Geneva interim agreement and its aftermath. For example, Iran’s oil exports have increased nearly 60% from October 2013 to January 2014.

While the administration vows that the core architecture of Iran sanctions remains in place, UANI analysis shows that the four interdependent elements of the sanctions regime—(1) Increasingly strict laws and regulations, (2) enforcement action, (3) reputational risk, and; (4) the psychological impact on the Iranian economy—have weakened, and as a result, the architecture of the sanctions regime may in fact be coming apart.

In this section, UANI tracks key indicators of the Iranian economy, to gauge the true value of the sanctions relief being provided.

Value Of The Rial

The effect of economic pressure can be measured, in important part, by tracking the Iranian rial’s black market value exchange rate. Last year, with economic pressure at its peak, Iran suffered from severe hyperinflation, and the rial became the least valued currency in the world. This is no longer the case, as the rial has gained significant value in 2013.

Since Hassan Rouhani was elected president on June 14, the Iranian rial has increased in value by more than 25%, from 36,500 rials/dollar to 29,000 rials/dollar today (and up from record-lows of 40,000 rials/dollar in February 2013). Political developments have clearly had an impact of the rial’s value. Following the announcement of the Geneva agreement on November 24 and the beginning of its implementation on January 20, the rial appreciated significantly.


At the beginning of   Rouhani’s presidency the inflation rate stood at 43%. The inflation  rate has now fallen to 35%, and Rouhani has set atarget rate  below 25% by the end of the next Persian calendar year (March 2015).

Oil Exports

When the Geneva agreement was signed on November 24, a senior administration official stated that “Iran’s oil exports will remain steady at their current level of around 1 million barrels per day.” Unfortunately, even before the January 20 implementation of the agreement, Iran’s oil exports increased nearly 60% from historically low levels of 761,000 bpd in October 2013 to  1.2 million barrels/day (bpd) in January 2014.

It is clear that the Geneva negotiations and the  signing of the interim agreement significantly altered a trend of ever increasing reductions in oil purchases from Iran, mainly by signaling an easing of restrictions and reducing risks for buyers and traders. Now that the agreement is being implemented, Iran’s oil exports are in position to increase further as tanker insurance provisions are relaxed and shipments costs for the Iranian oil sector are reduced.

Tehran Stock Exchange

Since Rouhani’s election, The Tehran Stock Exchange index has increased by nearly 100%, from about 45,000 points to over 80,000 points.

Trade Delegations and Diplomatic Missions

Since the signing of the Geneva agreement on November 24, Iran has been receiving parliamentary missions and trade delegations from countries that are eager to rekindle commerce with Iran. The pace of these missions and delegations has only increased since the agreement commenced on January 20. According to The New York Times, “In the first two weeks of the year, Iran welcomed more delegations from Europe than in all of 2013.”

  • According to Mehrdad Jalalipour, director of Iran’s Trade Promotion Organisation, trade delegations from the following countries have visited Iran since early December

    • Austria Austria
    • China China
    •  Georgia
    •  India
    •  Ireland
    •  Italy
    •  Kazakhstan
    •  Sweden
    •  Tunisia
    •  Turkey
  • Upcoming high-level diplomatic missions and trade delegations:


Corporate Comeback

Since the signing of the Geneva agreement, there have been numerous reports and firsthand accounts of Iran’s automotive and energy sectors anticipating the return of major multinational corporations. With the momentum of sanctions halted and now reversed, reputational and financial risk has clearly declined for multinational corporations that are publicly pursuing the renewal or expansion of their Iran business.

Iran Business Renewed/Expanded

 Austrian Airlines (Aviation)

 International Group of P&I Clubs(Shipping)

 Japan P&I Club (Shipping)

 Tessenderlo (Chemicals)

 Unifert (Agriculture)

Engaged in Discussions/Preparations to Expand/Renew Iran Business

 Alstom (Transportation Infrastructure)

 Airbus (Aviation)

 AVL (Automotive)

 BNP Paribas (Banking)

 Commerzbank (Banking)

 Credit Agricole (Banking)

 Doka (Construction)

 Doppelmayr (Manufcaturing)

 Eni (Energy)

 GDF Suez (Energy)

GlaxoSmithKline (Pharmaceuticals)

 Halkbank (Banking)

 ILF (Engineering)

 Jawaharlal Nehru Port Trust (Shipping)

Merck KGaA (Pharmaceuticals)

 OMV (Energy)

 Pininfarina (Automotive)

 Plasser & Theurer (Transportation Infrastructure)

 Peugeot (Automotive)

 Renault (Automotive)

 Royal Dutch Shell (Energy)

 Safran (Aviation)

 Sanofi (Pharmaceuticals)

 Société Générale (Banking)

 Veolia Environnement (Water & Waste Mgmt.)

 Vitol (Energy)

 Zhuhai Zhenrong (Energy)

Expressed Interest in Expanding/Renewing Iran Business

 Bosch (Manufacturing)

 HPCL (Energy)

 Lukoil (Energy)

Existing Iran Business Operations Improved by Eased Sanctions

 Aban Offshore (Energy)

 Gubretas (Chemicals)


Sanctions Enforcement

Sanctions Designations Timer:


Days PassedSince Last Treasury Sanctions Designation Action



2013-2014 Iran Sanctions Designations

Designation Announcements

Entities Added


























TOTAL Before Rouhani’s Election


TOTAL After Rouhani’s Election


TOTAL 2013 Designations


TOTAL 2014 Designations


TOTAL Designations Since Nov. 24 Geneva Agreement


The Obama administration has pledged to fully enforce all existing sanctions against Iran. David Cohen, the U.S. Treasury Department’s point man on sanctions vowed, “The Joint Plan of Action reached in Geneva does not, and will not, interfere with our continued efforts to expose and disrupt those supporting Iran’s nuclear program or seeking to evade our sanctions.”

Evidence indicates, however, that since Rouhani’s election, the U.S. has been much less aggressive in enforcing sanctions. In 2013 before Rouhani’s June 14 election, the Treasury issued 10 sanctions announcements which designated 183 entities for violating Iran sanctions. Since Rouhani’s election, there have only been two announcements, blacklisting a total of 29 entities. When the U.S. Treasury designated 19 Iran sanctions violators on December 12, 2013, Iran falsely claimed that the U.S. had violated the framework agreement and temporarily walked out of negotiations to implement the interim nuclear agreement. UANI will be closely tracking whether the Obama administration is holding to its pledge to maximally enforce sanctions, or if it will be walking on eggshells in order to avoid offending the Iranian regime.


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