U.S., IRAN NUCLEAR DEAL

PLATTS - 06 Apr 2021  - The US and Iran appear to have made headway in their indirect talks in Vienna over restoring the nuclear deal, improving the prospects of sanctions relief that could see severe restrictions on Iranian oil sales lifted. 

The parties to the deal agreed on April 6 to set up two parallel working groups – one to work out the conditions under which the US would formally reenter the pact and lift its sanctions, and another to lay out a pathway for Iran to bring its nuclear program back in compliance with the parameters of the agreement.
If concluded successfully and mutually agreed, up to 2 million b/d of Iranian crude could eventually reenter the market once sanctions are dropped and Iran fully rehabilitates its oil infrastructure. 

"All in all, the meeting was constructive," Abbas Araghchi, the head of the Iranian negotiating team, told state television. 

The working groups "should finalize the actions that the two sides should do in one phase, and then the Joint Commission will decide the order of these actions and details of the timetables," he added. 

Russian representative Mikhail Ulyanov said on Twitter that the restoration of the nuclear deal, known formally as the Joint Comprehensive Plan of Action, "will not happen immediately." 

"It will take some time. How long? Nobody knows. The most important thing after today's meeting of the Joint Commission is that practical work towards achieving this goal has started." 

Iran met in Vienna with the remaining signatories of the deal – the EU, UK, France, Russia, China and Germany. While the US was also in Vienna, it did not participate directly in those talks but met separately with the deal signatories in a different part of the city. 

The Joint Commission will meet again April 9.

"We hope that the expert groups reach some results in the coming days," Araghchi said. "We will constantly evaluate the work of these two groups and monitor the progress."

Making the first move

US President Joe Biden has said he would like to return the JCPOA, after former President Donald Trump withdrew the US in May 2018 and reimposed sanctions, prompting Iran to break some of its requirements under the deal.

Biden has insisted that Iran return to compliance before the JCPOA can be restored, while Tehran has said the US must end the sanctions first.

"We expect this to be a long process, and we continue to believe that a diplomatic path is the right path forward, and there are benefits to all sides," White House press secretary Jen Psaki told reporters in Washington.

Iran has historically held 4 million b/d of crude production capacity, but the US sanctions practically halved its output. In recent months, however, Iranian production has risen, largely on the back of increased exports to China as a direct challenge to the US.

Iran pumped 2.14 million b/d in February, according to the latest S&P Global Platts survey of OPEC production.

Platts Analytics estimates Iran's crude and condensate exports averaged 825,000 b/d in Q1, up from 420,000 b/d in Q3 2020.

At least 3 million-4 million mt of Iranian crudes have arrived in the first quarter this year at China's Shandong province, home to the country's independent refineries, data collected by Platts showed April 6.

The indirect talks came as the Iranian ship Saviz reportedly suffered damage by a limpet mine in the Red Sea, according to semi-official news agency Tasnim, in the latest maritime attack in the Middle East.. Other reports said the vessel served as an Iranian spy ship.

US State Department spokesman Ned Price said he didn't have any comment on the apparent attack, which some reports have attributed to Israel, a staunch opponent of Iran.

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