Iran Won't Fall Into Trump's Nuclear Deal `Trap,' Rouhani Says

(Bloomberg) -- Iran will not fall into the “trap” that the Trump administration is attempting to set in order to force the collapse of the 2015 nuclear deal, President Hassan Rouhani said on Wednesday.

The U.S. “ploy today is to behave in such a way as to have Iran say ‘I am walking away’" from the agreement, Rouhani told his cabinet, according to the state-run Iranian Students News Agency. Iran “needs to be aware not to fall into their trap,” he said.

Rouhani’s intervention came after the U.S. again made clear its readiness to confront Iran and the accord that scaled back its nuclear program in return for sanctions relief. On Monday, it affirmed that the Islamic Republic has continued to meet the agreement’s conditions -- as required every three months -- but hours later imposed new sanctions over what it called Iran’s persistent efforts to destabilize the Middle East.

There is “a school of thought in the administration” that wants to push Iran into walking away from the deal, said Henry Smith, lead analyst on Iran and the Middle East at the Dubai office of Control Risks, a research group. “The motivation for that is to make Iran look like it’s at fault rather than” the U.S, he said. The White House is conducting a broader review of policy toward the Islamic Republic.

Donald Trump lambasted the Iran deal during the presidential campaign and vowed to dismantle or renegotiate it if elected. But he’s now being advised by officials including Secretary of State Rex Tillerson and Defense Secretary James Mattis who don’t seem to “want the U.S. to be viewed as the aggressor” if the deal were to fall apart, according to Smith.

‘It’s Isolating’

“They would much rather that that is perceived by the Europeans as being Iran’s fault, because otherwise it’s isolating,” he said.

Viewed from Tehran, it’s the U.S. that hasn’t been living up to its end of the bargain. By pressing businesses not to work with Iran, Iranian officials say, the Trump government is undermining the pact’s objective of normalizing trade, preventing Iran from benefiting from the accord while appearing to uphold it.

Iran has boosted oil exports and attracted foreign investment since sanctions relief was implemented in January 2016. But a set of sanctions not related to the agreement by the U.S. prevent most American entities from doing business with Iran.

Under the agreement, Iran is allowed to enrich and store some uranium for energy production, although it had to reduce its uranium stockpile by 96 percent, idle many of its enrichment centrifuges and pour concrete into its heavy water nuclear reactor. The Obama administration insisted the provisions would slow the time it would take Iran to produce nuclear weapons, something Iran has said it wasn’t trying to do.

Countersteps

Rouhani said Iran will respond to any new U.S. sanctions that violate the terms of the nuclear deal with countersteps.

If the U.S. wants “to implement sanctions under any pretext or excuse, the Iranian nation will respond accordingly,” he said in comments broadcast on state television. “When it comes to congressional legislation, our parliament will approve corresponding measures.”

As the U.S. announced the new sanctions, Iran’s parliament moved to introduce a bill that would increase funding for the Revolutionary Guards and the country’s missile program, over which Congress is considering new sanctions. The legislation would need to be approved by parliament and the influential Guardian Council of Islamic law experts and jurists.

The five other deal signatories, which include the U.K., France and Russia, have continued to back the landmark foreign policy success of the Obama presidency. The International Atomic Energy Agency, which monitors Iran’s compliance with the accord, has found that it has largely met its obligations.

Iranian Foreign Minister Javad Zarif said Monday that his country’s vow not to seek nuclear weapons “never expires.” Still, he cautioned that Iran would withdraw from the accord in the event of a “major violation” on the part of the U.S. He didn’t say what would qualify.

For now, Iran won’t want to risk imperiling the deal, according to Smith at Control Risks. It’s much more likely to take “retaliatory measures using their own sanctions, or do something provocative like missile testing” that portray it standing up to the U.S. but won’t fundamentally threaten the accord, he said.

To contact the reporters on this story: Golnar Motevalli in Tehran at gmotevalli@bloomberg.net, Ladane Nasseri in Dubai at lnasseri@bloomberg.net.

To contact the editors responsible for this story: Alaa Shahine at asalha@bloomberg.net, Mark Williams, Amy Teibel