Peace Time: Those Smuggler-Friendly Americans

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January 17, 2022: Iran is still suffering from reimposed (in 2018) economic sanctions but, as expected, the new (in January 2021) U.S. government has provided some relief. The Americans have been helpful in several ways, not all of them very visible. For example, the Americans quietly reduced their sanctions enforcement on illegal Iranian oil exports during 2021. This enabled Iranian oil smugglers to ship and sell 40 percent more oil than in 2020. That’s 123 million more barrels of oil sold at a discount, from the world price for legal oil, to countries like China, Syria, Russia and Venezuela. In 2021 the U.S. halted enforcement of the oil export sanctions in the Persian Gulf, which made it possible for smugglers to sell discounted Iranian oil to Arab Persian Gulf countries, mainly the UAE, where that oil could then be exported as Arab oil to distant customers. Iran has a fleet of tankers, most not owned by Iran, that handle the smuggling and American efforts to track and sanction these tankers declined as did the number of times smuggling tankers were detected but not intercepted. Because of this Iran had several hundred million dollars of oil income that was apparently used mainly to sustain Iran-sponsored violence overseas.

The American government again contains many of the officials who worked for the 2015 government that joined the JCPOA (Joint Comprehensive Plan of Action) group and made the lifting of Iranian sanctions possible. JCPOA is again trying to negotiate an end to the revived sanctions. JCPOA consists of six nations; China, France, Russia, Britain, the U.S. and Germany, that negotiated and signed the 2015 treaty with Iran to lift economic sanctions in return for Iran halting its nuclear weapons program, which Iran insisted it did not have. In response to this offer a new, more radical government in Iran refuses to talk with the U.S. directly, so the negotiations are being held in Austria where the U.S. representative has to be briefed by the other JCPOA members after every encounter they have with the Iranian delegates. Iran insisted that the U.S. drop all its renewed sanctions on Iran before Americans can negotiate directly with the Iranians. That sort of pre-condition, thanks to decades of abuse by North Korea, is now unacceptable to most Americans and keeps the American negotiators from actively participating in the new talks. Another obstacle is the growing list of Iranian sponsored violence throughout the Middle East. In some cases, Iranians are directly involved, something Iran prefers to avoid and just depend on proxies.

By the end of 2021 U.S. negotiators agreed to lift additional sanctions added to those renewed in 2018 if Iran agreed to let negotiations on their nuclear weapons program proceed. Iran rejected that, insisting that all the post-2017 sanctions be lifted before any discussion of nuclear research could be discussed.

The Iranians have adopted this new attitude because their situation has changed considerably since 2015. In 2021 Iranian leaders were much less confident and beset by far more internal and external threats. This was the result of Iranian government deciding to spend the billions in additional cash and oil income they received after the 2015 deal was signed. Instead of investing in the Iranian economy and improving the lives of most Iranians, the main beneficiaries were foreign military operations Iran was already involved with. The most-costly one was Syria, where an Iranian ally (the Shia Assad clan) was dealing with a massive rebellion against decades of brutal Assad rule. The post 2015 financial windfall enabled Iran to pour billions into helping the Assads survive the rebellion which, in 2015, was on the verge of overthrowing the Assads. To save the Assads required Iran to hire over 50,000 Shia men as mercenaries. Many of these came from Lebanon, where Iran had been supporting the Shia Hezbollah militia there since the 1980s. Despite Iranian orders to threaten and antagonize Israel, not start a war, Hezbollah did so in 2006 and saw billions worth of past Iranian aid go up in smoke, Hezbollah had suffered an embarrassing defeat and Iran paid to repair most of the damage, including bringing in thousands of new rockets and other weapons as well as more cash to expand the Hezbollah full time and part-time force of militiamen and bureaucrats.

After the 2006 debacle Hezbollah, which controlled most of southern Lebanon, became more unpopular with the majority of Lebanese, who were not Shia and resented how Iran, through Hezbollah, had come to dominate their country. Going into 2021 Hezbollah has acquired too many enemies, not enough allies and no additional Iranian financial aid. Since 2018 Iran has cut the money sent to the Assads and Hezbollah by half. Reductions of aid to the Assads were even larger and now most of the money Iran spends in Syria is to establish a military infrastructure with which to threaten Israel. That has backfired because Israel has responded with hundreds of airstrikes against Iranian forces, bases and shipments of new missiles and other expensive military gear. The Assads are now openly talking about making a deal with Turkey, Russia, Gulf Arabs and Israel to get Iran out of Syria.

In Lebanon Hezbollah has lost the support of a lot of local Shia and is desperately seeking a way out of this mess. The thousands of casualties Hezbollah suffered in Syria were initially taken care of by Iran, which paid for medical treatment, long term care of wounded and payments to families of those killed. Iran is no longer able to pay for continued long-term care of the wounded and other cuts have put a lot more Hezbollah supporters out of a job.

Back in Iran the economic situation for most Iranians got worse after 2015 and by 2017 there were nationwide protests against this. The protestors included, for the first time, people from areas that had long supported the IRGC (Islamic Revolutionary Guard Corps) and supplied the IRGC with volunteers that enforced obedience to the religious dictatorship. Until 2017 the religious faction in control of Iran only had the support of about a fifth of the population. After two years of this violence was finally halted by killing nearly 2,000 Iranians and wounding or arresting over 10,000, they realized they were losing many, if not most of their core supporters. It got worse in 2020 when covid19 arrived and the religious dictatorship mismanaged that in a spectacular fashion. It did keep most protestors off the streets but the Iranian leaders realized that was temporary and protests returned in 2021 and may become too massive to deal with. That’s because the core problem is the corruption that has grown within the thousands of families that replaced the monarchy and nobility in the 1980s and eventually because even more corrupt and incompetent than the aristocrats. The Internet made this worse because many of the younger members of the new ruling class flaunted their lavish lifestyles on social media. The Internet access also revealed the tactics used to lift the sanctions and how much additional oil was smuggled out. Most Iranians continued to suffer from inflation, shortages and a growing percentage of families living in poverty.

 


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