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Monday, October 22, 2012

Iran: U.S. Concerns and Policy Responses

Kenneth Katzman
Specialist in Middle Eastern Affairs

A priority of Obama Administration policy has been to address the perceived threat posed by Iran to a broad range of U.S. interests, in particular the potential threat posed by the advance of Iran’s nuclear enrichment program. These advances have caused the government of Israel to assert that it might take unilateral military action against Iran’s nuclear facilities unless the United States provides assurances that it will act, militarily if necessary, to prevent Iran from taking the final steps toward developing a nuclear weapon. Aside from the nuclear issue, the United States has long seen a threat to U.S. interests posed by Iran’s support for militant groups in the Middle East and in Iraq and Afghanistan. U.S. officials accuse Iran of helping Syria’s leadership try to defeat a growing popular opposition movement and of taking advantage of Shiite majority unrest against the Sunni-led, pro-U.S. government of Bahrain.

The Obama Administration has orchestrated broad international pressure on Iran through economic sanctions, while also offering Iran sustained engagement if it verifiably demonstrates to the international community that its nuclear program is peaceful. Iran’s leaders returned to nuclear talks with six powers in April 2012 after a one year hiatus. Three rounds of talks held in April, in May, and in June yielded no breakthroughs, but did explore a potential compromise under which Iran might end uranium enrichment to 20% purity (a level not technically far from weapons grade) in exchange for substantial sanctions relief. Technical talks were held on July 3, 2012, with further conversations between Iranian and EU negotiators during July—September 2012. These conversations produced no announcement of another round of high level talks. The Administration expresses frustration that no settlement has been reached, but it asserts that there is time and space for the accumulated sanctions to compel Iran’s leaders to compromise before U.S. military action be considered. Since the beginning of 2012, as significant multilateral sanctions have been added on Iran’s oil exports—including an oil purchase embargo by the European Union that went into full effect on July 1, 2012—the regime has begun to acknowledge significant economic pressure. Those pressure led to a virtual collapse in the market value of Iran’s currency, the rial, in early October 2012. Since late 2011, both Britain and Canada, have closed their embassies in Iran.

The Administration and many outside experts also perceive that the legitimacy and popularity of Iran’s regime is in decline, although not to the point where the regime’s grip on power is threatened. There are few outward signs that the opposition in Iran or in exile have gained traction against the regime, even though international sanctions are causing clear public frustration over deteriorating economic conditions. The reformist boycott of the March 2, 2012, parliamentary elections rendered the election a contest between factions supporting either President Mahmoud Ahmadinejad or Supreme Leader Ali Khamene’i. Khamene’i supporters were elected overwhelmingly, helping him solidify his control over day-to-day governance. It is likely that only hardliners will be significant candidates in the next presidential election to be held on June 14, 2013.

The 112th Congress has supported additional economic sanctions against Iran, most recently with enactment of the Iran Threat Reduction and Syria Human Rights Act of 2012 (H.R. 1905, P.L. 112-158), which expands sanctions against companies that conduct energy and financial transactions with Iran. Additional sanctions are reportedly under consideration by the European Union and by some Members of Congress. For further information, including pending Iran sanctions legislation, see CRS Report RS20871, Iran Sanctions, and CRS Report R40094, Iran’s Nuclear Program: Tehran’s Compliance with International Obligations, by Paul K. Kerr.

Date of Report: October 11, 2012
Number of Pages: 86
Order Number: RL32048
Price: $29.95

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