Iran

The president is in the difficult position of either backing down in the face of Iranian threats and suspected attacks or escalating the conflict in ways he clearly wants to avoid.

Jack McCaslin is a research associate for Africa policy studies at the Council on Foreign Relations in Washington, DC. On September 10, members of the Islamic Movement of Nigeria (IMN), a Shia religious and political movement, marched in different cities across the north of Nigeria to mark the beginning of Ashura, a major Muslim holiday. In doing so, they defied the government, which, in July, had banned the group. The IMN later claimed that fifteen of their members had been killed after police opened fire on the various IMN processions. The police denied the claim. Complicating the episode is the fact that not all Shiites consider themselves members of the IMN, even if they may follow or support Zakzaky. Their participation in the Ashura march could stem just as much from their religious faith as their "membership" in the IMN. The decision to label the IMN as a terrorist organization came after deadly clashes between security services and alleged IMN members in July, who were protesting the continued imprisonment of their leader, Sheikh Ibrahim el-Zakzaky. The government has since accused Zakzaky of planning a takeover of Nigeria along the lines of the 1979 Iranian revolution. It is true that he has clear ties to Iran, is said to be inspired by the Iranian Revolution, uses the term “Great Satan” to refer to the United States, and  preaches against the government. But it is not clear that he has openly called for violence, and links to violence are tenuous. To the extent that deadly force used against the IMN is unprovoked, they are largely peaceful.  Zakzaky has been in government custody since 2015 without trial. He is being held in relation to a series of confrontations between his followers and the military, in which an estimated three hundred IMN members were killed around Zaria, Kaduna in 2015. Zakzaky’s home was subsequently raided, members of his family killed, and he and his wife taken into custody. He is in poor health, partly the result of injuries allegedly sustained during his arrest. In August, he was allowed to travel to India to receive medical treatment. However, he was unhappy with his treatment there, alleging U.S. involvement, and returned to Nigeria without receiving treatment.   Such a clash as the one this month, between IMN members participating in religious processions—albeit that sometimes double as protests against Zakzaky’s imprisonment—and security services, may sound familiar. One year ago, IMN members clashed with security services during the Arbaeen Symbolic Trek, an event related to Ashura. At least forty people were likely killed as a result, making it one of the deadliest incidents since Zaria in 2015.  It is not clear what strategy the Abuja government is following with respect to the IMN, but Zakzaky’s issues with the Nigerian government are unlikely to be resolved anytime soon. The point is, however, that a religious procession or peaceful protest over the detention of Zakzaky should not end in bloodshed. The police are in desperate need of reform. Their handling—and that of the larger security service apparatus—of ostensibly peaceful movements is highly problematic, and could easily serve to inflame, rather than deescalate tensions.

In the swirl of conflicting reports about who might be responsible for the latest attack against Saudi Arabian oil installations, it is important not to miss what makes this latest attack categorically different from past skirmishes. Saudi Arabia and Iran have been engaged in a deadly proxy war for a number of years, and their respective proxies engaged in oil sabotage as far back as early 2018. More recently, Iranian-backed proxies have hassled international oil tankers, bombed an ExxonMobil operations center in Southern Iraq, targeted a key Saudi pipeline, and attacked a strategically important oil storage hub in the United Arab Emirates. These previous incidents, while signaling the vast vulnerabilities of the Gulf region’s massive energy operations, failed to rise to an emergency because the damages involved were relatively easy to ameliorate. Many considered these early aggressions as an ominous warning sign that more serious attacks could come if tensions continued to escalate. That day has arrived. The perpetrators of this past weekend’s attack on critical infrastructure at Saudi Arabia’s second largest oil field at Khurais and its large and vital crude oil stabilization center at Abqaiq selected high value targets that could potentially maximize the size and length of a partial cessation of Saudi crude oil exports. A U.S. government assessment suggested that the Abqaiq facility that is used to strip impurities such poisonous hydrogen sulfide out of raw crude oil to prepare it for shipping and use suffered from direct hits in at least 17 different places. Damaged stabilization towers and gasoil separation plants (GOSPs) that remove natural gas, sand, and natural gas liquids from raw crude, can be costly and time-consuming to repair or replace.  The targets were selected with an eye to disrupt a large portion of Saudi Arabia’s oil deliveries to market for a long time, not the couple of days more typical of a minor pipeline attack or small volume of a diverted oil tanker.  Shutting down oil fields in a sudden, unplanned manner, which resulted from the extensive damage to the stabilization units, can also create its own unique set of problems. U.S. security analysts have been gaming a missile attack on the Abqaiq stabilization complex for years, apparently not terribly accurately.   The immediate interruption of 5.7 million barrels a day of Saudi crude oil exports due to the attack generated the largest price jump in U.K. Brent crude futures on record. The disruption is currently being offset by sales of oil from Saudi storage facilities. Increases in production from unused Saudi oil fields and from spare capacity from other countries such as the United Arab Emirates will provide offsets in the longer run.  About 5.2 million b/d was lost to markets in the aftermath of Iraq’s invasion of Kuwait in 1990. During the eight year Iraq-Iran war that ended in 1988, the oil export infrastructure of both Iran and Iraq was mostly destroyed. The problem moving forward for Saudi Arabia (and for the United States, should it desire to intervene) is that it may prove tricky to thwart new oil-related attacks by Iran and its proxies. It is very unclear if a U.S.-led coalition preventative attack against missile batteries could even be effective. Iranian proxies and direct Iranian military assets are located on multiple fronts along the Saudi border. Distances are close and oil installations of other countries could also become at risk in any forceful escalation of violence. With so many armed parties across the Middle East, identifying and eliminating major threats to oil facilities will be challenging. Such threats can take many forms including missiles, armed drones, and cyber-attacks. Both the United States and most likely Iran have capability to engage in cyberattacks against each other’s electricity networks.  The real question is why has the deterrence of more conflict, even potentially against targets inside the Iranian homeland, failed to discourage such a large jugular attack on Saudi Arabia’s critical oil nodes? The explanation that it is the best way to force a negotiation rings hollow. The larger move against Saudi Arabia’s oil lifeblood puts the United States in a quandary. On the one hand, the Trump administration has been eager to consider stricter measures, including military strikes, that might deter Iran from new provocations. On the other hand, the United States and its allies surely want to avoid triggering a wider conflict. The attacks on Abqaiq and Khurais seem to give Iran several benefits, including putting the Saudi regime under greater financial pressure, creating a vast political dilemma for President Donald Trump in an election year, and enhancing perceptions of Iran’s hard power in the region.   If one could turn back the clock, doing more to end the bloodshed in Yemen might have provided more maneuvering room before things got to this regrettable juncture. Gestures toward negotiations, including the shuffling of higher volumes of IOU Iranian crude oil exports towards Asia and talk of credit lines, appear stillborn. The region is lurching towards potential economic disaster that will be made so much worse as the climate warms.  Iranian leaders might see geopolitical victory on their horizon but it could turn out to be a hollow one for their 80 million people.

The attacks on the sprawling Saudi oil facility bear all the hallmarks of an Iranian operation, marking a dangerous new phase in Gulf tensions.

The United States came up with “maximum pressure”—but the Israeli government is the only one carrying it out.

U.S. cyberattack diminished Iran’s ability to target oil tankers; U.S.-China tech decoupling continues; U.S. government prepares for 2020 election ransomware attacks; and malicious code used by Chinese APTs resurfaces.

On August 13, Ibrahim el-Zakzaky arrived in India to receive medical treatment. Three days later, he returned to Nigeria having refused medical treatment. Upon his return, he was placed under arrest. He found his treatment in New Delhi to be unsatisfactory and objected to the tight security arrangements that had been put in place. He and some of his followers are claiming that the United States was behind his perceived poor treatment in India. Sheikh Ibrahim el-Zakzaky is a charismatic Shia preacher and founder of the Islamic Movement of Nigeria (IMN). He has been in government custody since 2015, though he has yet to face a trial. He is accused of inciting an attack on a military convoy; the incident led to the death of over three hundred IMN members, and to his and his wife’s arrest. Periodic IMN protests over his detention have sometimes led to deadly clashes with security services.  Not only is there no credible evidence of any American involvement in Zakzaky’s travel to India for medical treatment and his subsequent return, it is hard to think of anything less probable. The United States has no interests at stake in the nature of Zakzaky’s treatment. However, the notion that the United States has somehow manipulated the situation so that Zakzaky has not received the medical treatment he needs and deserves has become an urban legend in some Nigerian circles. Where the story of American involvement came from is not known. However, Iran is a credible hypothesis. Iran has long supported Zakzaky, and has provided him with funds. Given the poor bilateral relationship between Iran and the Trump administration, it is easy to imagine that some Iranian elements looked to exploit Zakzaky’s medical treatment (or the lack thereof) to score points against the United States.  Why have some elements in Nigeria bought in to the story of alleged American interference? Conspiracy theories about almost everything are common in Nigeria. So, too, is the sense that the United States is so powerful that it could certainly manipulate Zakzaky’s medical treatment in a third country with which Washington has good relations. Some Nigerians also have an exaggerated view of the importance of Nigerian developments in American official circles. Apparently, Zakzaky himself believes there was American involvement. This is not particularly surprising. He is hostile to the West, to secularism, and, at times to any Washington administration. He also knows that the bilateral relationship between the Trump and Buhari administrations is good. Hence alleged American involvement in his New Delhi adventures is convenient.

The Trump administration’s nonresponse to Iranian aggression has sent an unmistakable message.

Oil is a global commodity where prices adjust to a supply disruption in one place across all locations, no matter country or location where the problem started. To help people understand what that means, I like to use the analogy of a swimming pool. If one takes a giant bucket of water out of the deep end of a swimming pool, it affects the water level for the entire pool, not just the deep end. The larger the bucket, the more swimmers will notice changes in the water level throughout the entire pool. The upshot of this global nature to oil is that freedom of movement of oil through the Strait of Hormuz is a global problem. Countries might think that maintaining “good” relations with Iran might mean their ships won’t get attacked, but it is not truly relevant. If anyone’s ships are attacked, the oil disruption that could ensue will affect all oil importing countries. The International Energy Agency (IEA) was formed out of an understanding of this notion of the global nature of the oil market. Emergency stock releases need to be coordinated because if one country releases strategic stocks and other countries hoard oil instead, the net supply gain to markets can be cancelled out, hence coordinated stock release policy is advantageous. IEA announced this week that it is prepared to act if oil flows are disrupted from the Middle East. Iran may feel it is getting an upper hand by showing it has been wronged and is a nation to be reckoned with. The problem is Tehran is also showing the world what a problem it could become if it actually had nuclear weapons capability. This week, governments from the U.K. to Germany and to Japan will have to decide how much force to apply to protect oil shipments in their vessels and flag ships. But what if Iran were a nuclear power? The calculus would be quite different. The bargaining process for conflicts where parties have access to missiles with nuclear warheads is altered. Nuclear weapons add additional risk on the party that desires to change the status quo. One can expect the cost is higher for third parties who would want to intervene in regional conflicts. A future nuclear-armed Iranian declaration that only the oil Tehran dictates will be allowed to transit the Strait of Hormuz would present an even more complex situation than today’s geopolitical challenge of sanctions and shipping. The military problem of protecting shipping would become more dangerous and potentially require a military campaign to destroy any active Iranian nuclear warheads before engaging conventional Iranian forces that are blocking free transit of the Strait. The history of nuclear deterrence theory suggests Iran would never use a nuclear weapon, even if it had one because of the extreme consequence of enormous loss from a second strike. But the possibility of internal political instability can in itself alter a bargaining process. One might have imagined Iran would not have taken such a decisive act against British vessels for fear of attack by the North American Treaty Organization alliance. NATO did, after all, intervene in Libya in 2011 under a situation perhaps less clear than blockage of an international waterway.  That leads me to question whether Iran may have overplayed its hand. Now that the strategic risk of a nuclear-Iran is so much more transparent, would Europe still feel it can afford to provide nuclear technical assistance to Iran including equipment under the terms of the 2015 Joint Comprehensive Plan of Action (JCPOA)? China must also see the detriment to itself of a nuclear-armed Iran. It’s easy to facilely link the escalation of tensions with Iran on the Trump administration’s “maximum pressure” campaign, which has disturbed an already tense status quo but now thoughtful analysis needs to be made regarding what the current situation has taught about the war-ready nature of factions within the Iranian government. Some lessons are relevant to future diplomatic solution-building regardless of how we got here. The reality is that conflicts involving Iran throughout the Mideast proceeded – and in some cases escalated- even after the JPCOA took hold. The opportunity that signing the nuclear deal would moderate Iran’s foreign policy regarding regional conflicts and assassination plots in Europe was unrealized, even before the Trump administration reversed the U.S. commitment to the JCPOA. As Europe moves forward in trying to fashion a solution, Iran (and Russia) will need to consider the changing nature of the global oil business. Iran has to concern itself with the future geopolitics of stranded oil assets. Removing itself now from oil and gas commodity markets and direct foreign investment opportunities at this pivotal time in oil’s potentially declining future might have long lasting negative consequences for its energy industry. Moreover, any military exchange that raises oil prices sharply could become the impetus that the West and China needs to accelerate the shift to low carbon energy more decisively. Such a result would reverberate in Moscow whose natural gas giant Gazprom is already struggling against a rise in renewable energy in Europe. China, which has never participated in a large global oil supply cutoff as a giant oil importer (it was self-sufficient in energy in 1973, 1979, and 1990), may also need to educate itself about the consequences of having one fifth of its oil supply have to traverse the Strait of Hormuz. China has more to lose from a poor outcome between the West and Iran than the West does given its lesser dependence on Middle East oil. Tehran may decide that its resistance economy is good enough for regime survival and choose the path of continued confrontation. That would be a tragedy for the entire region and present a serious challenge for the United States. The makeshift response to allow Britain to protect its own shipping calls into question whether the U.S. could abdicate (either on purpose or by accident) its vital superpower naval role which regulates sea lanes and, in effect, facilitates global trade. The consequences of the U.S. withdrawing from such a role is unthinkable for all concerned, even for the Chinese, who may seem to object to U.S. ships in the South China Sea, but, in reality, free ride off of U.S. air and naval power in so many aspects of their economic life. China should be careful what it wishes for. The Trump administration must avoid reconsidering this critical naval role nonchalantly. It is central to the United States’ global authority.  Just the appearance of U.S. hesitation about that role could invite unwanted seafaring military incursions and piracy across the globe. If Iran decides that conflict is better to regime survival than concession, the Trump administration’s lack of a well thought-through, implementable strategy regarding Iran will become an even larger problem. Oil markets will increasingly lose their imperviousness to risk as more speculators bid oil prices up. Regional allies could also become more insecure. All this means that now would be a good time to move away from ideological bents and study up on years of U.S. military gaming exercises regarding the Strait of Hormuz. The U.S. military has years of study and knowledge to fashion and lead an effective international coalition for diplomacy and deterrence in the Strait of Hormuz. It should use it.

As Iran slowly untethers itself from the Iran nuclear deal’s central constraints on enriched uranium, signaling the deal’s potential collapse, President Trump is proving that U.S. unilateral power remains paramount on the global stage.  Trump’s policy to kill the 2015 deal has been prevailing against the objections of the remaining signatories, perhaps the most powerful global counter-coalition possible — China, Russia, Germany, France, the United Kingdom and the European Union. It has been prevailing despite that Iran had until very recently been abiding by the deal following the U.S. withdrawal last May. But without an endgame strategy on Iran that includes an exit ramp off the escalatory ladder of tensions and a solution to the nuclear problem, Trump’s victory will be a Pyrrhic one. Throughout the Cold War and after, it was dogma that the United States needed partners in order to make sanctions work. With Iran, Trump has shown that the U.S. alone remains a preeminent power that can implement an unprecedented “maximum pressure” campaign of primary and secondary sanctions.  U.S. unilateral sanctions, and the threats to retaliate against companies doing business with Iran, have effectively crippled the Iranian economy, isolating it from international financial markets, drying up foreign investment, cutting its oil exports to 1.1million barrels per day (bpd) and below, stifling its economy (which is projected to shrink by 6 percent in 2019) and causing its currency to lose 60 percent of its value against the U.S. dollar.  But Trump’s assertion of U.S. unilateral power, through the use of sanctions, is a disruptive power and not an end in itself. To date, U.S. efforts to strengthen the Iran nuclear deal have been counterproductive to enhancing U.S. security. By withdrawing from the deal, Trump has provoked an Iranian reaction that could lead to the deal’s collapse while providing no alternative constraints on the Iranian nuclear program. The Iran Deal had resulted in a rollback of the Iranian nuclear program that included the removal of 98 percent of its enriched uranium, decreasing its enrichment capabilities to very low levels of 3.67 percent — far below weapons grade — and subjecting its program to robust international inspections. As the deal unravels, the Iranian program will be able to continue unfettered, adding once again to the destabilizing challenges in the region, not reducing them.  Furthermore, as the president recently increased the sanction pressure — including tightening sanctions on Iran's oil exports, sanctioning Iran’s supreme leader and placing its elite military, the Islamic Revolutionary Guard Corps (IRGC), on the terrorist list—Iran has adopted a more aggressive response and tensions have escalated across the region. The U.S. and Iran came very close to open conflict as the confrontation spilled into the Persian Gulf. And the chances for conflict are only accelerating as tit-for-tat reactions continue to disrupt the shipping lanes in the gulf. U.S. sanctions also have enabled the IRGC and Iran’s conservatives to tighten their control over Iran's economy and politics. And U.S. rejection of the Iran deal has turned the Iranian public against negotiations with the West, particularly on its nuclear program, further constraining Iran’s president, Hassan Rouhani’s; 72 percent do not think Iran should negotiate with the West because it is untrustworthy.  The challenge before Trump is whether he is willing and able to convert U.S. power into an endgame strategy that results not in war by design or miscalculation, not in Iran building nuclear weapons, but in his stated goals of a nuclear weapons-free Iran with a better nuclear deal and an Iran that, as Secretary of State Mike Pompeo put it, behaves like “a normal nation.” Meeting that challenge won’t be easy, especially for an administration that is short-staffed on the national security cabinet level on down, and a president who is dismissive of coordinated approaches to strategy and policy. Trump, nonetheless, did lay the groundwork for progress earlier recently when he offered to talk to the Iranians without pre-conditions. If this offer is more than just a hat tip to a U.S. domestic constituency, there needs to be a comprehensive strategy with clear goals, objectives and options. Time is of the essence as Iran moves away from the constraints on its nuclear program. To be successful, a strategy would need to include as incentives something very similar to what the president appears to be offering North Korea: broad-based sanctions relief and security guarantees reinforcing the president’s claim that he is not pursuing regime change in Iran.  Although the Iranian leadership has rejected the president’s offer, the Iranians should reconsider their response. The Iranian strategy is inappropriately focused on pressuring the other signatories to fulfill the trade and investment requirements of the Iran nuclear deal with threats of incremental violations every 60 days. This strategy does not fully recognize how the U.S. has checkmated the other signatories on this issue.   If the U.S. is going to go it alone on Iran, it must implement a strategy that leverages U.S. economic power into opportunities for a diplomatic solution that makes the U.S. more secure.

Western and Nigerian media are reporting that the principal Shiite movement in Nigeria, the Islamic Movement of Nigeria (IMN), “stormed” the National Assembly in Abuja on July 7. In the resulting melee, two people may have been killed and eight injured. As is so often the case, there are few details, with claims and counter-claims. But, the episode is a reminder that Shiites are a force now to be reckoned with in Nigerian street politics.  Spokesmen for the group say that their delegation was seeking to enter the National Assembly peaceably to protest the continued detention of their leader, Sheik Ibrahim el-Zakzaky, who has been under arrest since 2015. The Shia are saying that the police killed two protestors. The police are saying that they used “minimum force,” and that two of their officers were shot in the leg and six others were hurt by clubs and stones. Nigerian media, apparently hostile to the Shia, is saying that the protestors killed two National Assembly guards, burned three vehicles, and “destroyed many others.” Neither the deaths claimed by the Shia nor the casualties claimed by the police have been independently verified. Nigeria’s Shia minority, some of whom are organized with the IMN, oppose the very existence of Nigeria’s secular government. They also claim to be peaceful, and their leadership does not advocate violence. Current Shia grievances focus on the continued detention of Zakzaky, who faces murder charges brought by Kaduna state. (If convicted, he would face the death penalty.) Complicating the issue of Zakzaky’s imprisonment is that he stands accused by the Kaduna state government of murder, but he is imprisoned by the Federal government. Federal spokesmen have said that he cannot be released until his case is disposed of by the Kaduna courts.  Since Zakzaky’s arrest, there have been regular Shia protests, some of which have been violent and with police over-reaction. In October 2018, IMN supporters clashed with police in and around the capital, and at least forty Shia marchers were killed. The Abuja melee on July 7 appears to fit that pattern. Iran, whose Shia-dominated government has assisted the Nigerian Shias, periodically protests Zakzaky’s continued confinement.  The murder charges stem from an incident in Zaria in December 2015. Federal and military spokesmen say that a Shiite mob led by Zakzaky attempted to assassinate Nigeria's Chief of Army Staff Tukur Buratai when they blocked his convoy. Buratai was not killed, but the formal charges against Zakzaky accuse him and his followers of killing at least one soldier by name. In the aftermath, the army attacked IMN facilities, killing hundreds of people, including members of Zakzaky’s family. Zakzaky and his wife were seriously wounded in the attack and arrested. The IMN vociferously denies that there was any assassination attempt.  Like Boko Haram, the IMN sees the secular state as evil and wants an Islamic state based on Islamic law. The group is hostile to any Western influence, including in education. It is also hostile to Nigeria’s traditional political and religious elite. For the IMN, its model is the post-revolutionary Iranian Islamic state. In turn, the traditional Nigerian Islamic establishment despises the Shia. Despite certain similarities, the IMN and Boko Haram are anathema to each other. The IMN is opposed to Boko Haram’s use of violence and Zakzaky has claimed, implausibly, that it is a creation of the “oil-hungry west.” As with other Sunni radical movements in the Middle East, Boko Haram is especially hostile to Shias. The extent of Iranian financial and other support for Nigerian Shias in general and IMN in particular is unknown. Nobody really knows the size of the Shiite population in Nigeria. Credible estimates that its numbers range between 2 and 3 percent of Nigeria’s population, which would amount to roughly four million. Zakzaky has claimed at different times to have followers ranging from a few hundred thousand to three million; not all Nigerian Shias are associated with IMN. Whatever IMN’s numbers, were Zakzaky to be tried, convicted, and executed—the worst-case scenario—Abuja could very well face the black swan of a Shiite insurrection. 

The demise of the Iran nuclear deal does not make Tehran an immediate threat, but it opens the door to nuclear escalation.

A look at the post-9/11 war powers law that the Trump administration could use to justify conflict with Iran.

In a sign that anxiety about oil security of supply isn’t what it used to be, the Group of Twenty (G20) meeting broke up this week with no big joint statements regarding how to protect the freedom of navigation in the Strait of Hormuz. From the sidelines, U.S. President Donald J. Trump said there was “no rush” and “no time pressure” to ease tensions with Iran. German Chancellor Angela Merkel said she advocated “very strongly” to get into a negotiating process on the Iranian situation. Chinese President Xi Jinping noted that China “always stands on the side of peace and opposes war.” The latter statement was a pretty mild one given that approximately one-fifth of the oil that passes through the Strait of Hormuz is destined for China. China has given no public indication that it plans to protect its own shipping. Roughly 60 percent of crude oil passing through the Strait goes to China, Japan, South Korea, and India. The biggest statement about oil that emerged from the G20 came from Russian President Vladimir Putin who announced at the sidelines that Russia had agreed with Saudi Arabia to extend by six to nine months a deal with the Organization of Petroleum Exporting Countries (OPEC) to restrain oil output to support oil prices. OPEC then announced at its July 2 meeting in Vienna it had agreed to extend the deal for nine months into the first quarter of 2020. In speaking about OPEC’s deliberations, Iran’s oil minister said OPEC was being used as a “tool against Iran” jeopardizing the cartel’s survival. Last year, Iran told other members it was considering quitting OPEC. These various events say a lot about how the geopolitics of oil has changed and the huge implications those changes have for Iran. A decade ago, countries from the Gulf Cooperation Council (GCC) were of the mindset that they would never let Russia become a member of OPEC. At the same time, Iran was also a major rival to the GCC countries in its overall influence on OPEC outcomes, and both Russia and Iran boasted of their relations with each other in bolstering their respective positions in Mideast regional conflicts. But the new reality is that countries like Saudi Arabia now feel that they can basically ignore Iranian sensitivities at OPEC gatherings and have increased incentive to align with Russia on oil, not only because of the pressing need for revenue but also because of the geopolitical benefits of driving a wedge between Russia and Iran. In turn, Iran may have less to offer Russia as Moscow’s relations with the Arab world continue to improve, except perhaps the possible threat Tehran can make trouble for Russia in Syria or along susceptible pipeline routes. U.S. sanctions against Iran have long been in Russia’s interests to prevent Iranian oil and gas arriving in Europe to compete for its market share. But, Russia has a difficult road to navigate in its relations with Iran and Saudi Arabia since it will want to keep itself an important power broker around many of the Mideast’s current conflicts. This keeps U.S.-Russian interactions on the topic of Iran a challenging one.  The results of the G20 and subsequent OPEC meetings highlight the bind Tehran is in. What will be its geopolitical lever if oil and gas, which might have provided in years past, is no longer working? The large market surplus of natural gas is working against Iran. Japan’s state firm Japan Oil, Gas and Metals National Corporation (JOGMEC), for example, just signed on to Russia’s Arctic liquefied natural gas (LNG) expansion, in a sign that many countries that might have bought natural gas from Iran are looking elsewhere. The expected rising supplies of U.S. LNG are another. Chinese firms have also slowed new rounds of investment in Iran’s oil and gas sector and are increasingly investing in China’s own clean tech industry instead. Iran has to concern itself with the fact that as the United States, Russia, and oil producers in the Persian Gulf region expand capacity, its own reserves may become more likely to become obsolete or devalued if oil demand peaks over time. All this raises the question about how a petro-state like Iran reacts to the possible weakening of oil as a strategic tool. Iran will want to show the world that it still has a bargaining chip beyond its own oil resources. Some analysts are suggesting that by boxing it into a corner, the Trump administration might actually incentivize Tehran to lash out to make clear it is too important to ignore in an effort to drive the United States and others to the negotiating table, much the way North Korean missile tests got President Trump’s attention. Most recently, Iran’s response has focused on restarting its nuclear program. Iranian President Hassan Rouhani announced Tehran would return to its previous activities at the Arak nuclear reactor if the remaining signatories to the nuclear deal do not fulfil their promises. Iran might decide to focus on fast tracking its nuclear program to assert itself and gain leverage at a future negotiation. Alternatively, if it gets no geopolitical traction from restarting its nuclear program, Iran could stick with its grey area attacks on energy facilities to make the point it still has hard power to bring to bear. To date, the rules of engagement on cyber warfare against such targets have been harder to establish. A cyber escalation would be a dangerous outcome that would leave the United States with hard decisions about what kind of precedents to set in an active cyber conflict since a large escalation could lead directly to attempted cyberattacks against the U.S. homeland. Oil markets are betting that Iran will not choose to continue to disrupt shipping through the Strait of Hormuz since doing so would clearly escalate into a military confrontation with the United States. A second possibility, which would require much more diplomacy, is that Iran’s oil woes could prompt its leaders to look at the world with colder realism and come directly to the diplomatic route. One reason that approach could be compelling is that perhaps the real lesson for Iran is not that of North Korea, but of Venezuela whose oil industry is now decimated from years of corruption, lack of financing for maintenance, and an exit of foreign investors. As Mideast oil expert Sara Vakhshouri wrote in a report for the Atlantic Council in 2015, “Most of Iran’s oil fields are old and mature, which means they require further investment and treatments like gas reinjection, in order to maintain current production levels. The country’s oil wells are mostly in the second half of their lives, and are facing continued natural depletion of production capacity at the rate of 8-11 percent per year. It is estimated that Iranian oil fields lose between 300,000 to 500,000 b/d of natural reduction every year due to maturity of fields.” With its oil exports further curtailed this year, Iran should worry about not only losing market share today (and for however long it takes to restore its position in the global economy), but also the possibility that output drops could cause it to lose productive capacity more permanently if oil fields are damaged from forced production curtailment or reduced spending on maintenance over time. As Iran can see from its current failure to incentivize relations with Europe, Russia, India, China, and Japan by offering future stakes in its oil sector—a strategy that worked in the past but is apparently no longer effective—time is not on its side when it comes to preserving its future oil and gas sector opportunities.