US launches quiet diplomatic push with Iran to cool tensions

Talks in Oman seek release of American prisoners as Tehran wants billions of dollars trapped overseas.

Joe Biden took office pledging to revive an international nuclear pact with Iran. Picture: AFP

The Biden administration has quietly restarted talks with Iran in a bid to win the release of American prisoners held by Tehran and curb the country’s growing nuclear program, people close to the discussions say.

As contacts between the two sides resumed, Washington also approved €2.5bn ($4bn) in payments by the Iraqi government for Iranian electricity and gas imports, US and Iraqi officials said. The money had been frozen by US economic sanctions.

After discussions between senior US and Iranian officials in New York started in December, White House officials have travelled to Oman at least three times for further indirect contacts. Omani officials passed messages between the two sides.

US President Joe Biden took office pledging to revive an international nuclear pact that imposed limits on Iran’s nuclear programs in exchange for the removal of economic sanctions, before declaring in November that such a deal was dead. The US withdrew from the pact under Donald Trump.

The latest attempt at diplomacy represents a delicate political balancing act for Mr Biden and is focused on cooling tensions, which have soared this year as Iran provided drones to Russia for its war in Ukraine, pushed ahead with uranium enrichment and seized oil tankers in the Persian Gulf.

In exchange for a prisoner release and limits on nuclear work, Tehran is seeking billions of dollars in Iranian energy revenue trapped abroad by US sanctions. Iranian officials have repeatedly tied the possible release of prisoners to winning access to $US7bn in Iranian funds held in South Korea and demanded access to billions of dollars held in Iraq for deliveries of gas and oil.

South Korean former government officials with knowledge of the matter said discussions were continuing with Iran and the US over the release of that money for humanitarian purposes.

The Biden administration is eager to avoid catapulting negotiations with Iran to the top of the political agenda as the presidential campaign approaches. Any formal agreement or even a less formal understanding, which appears far more likely, could force a review in congress, where Republicans and some Democrats strongly oppose a nuclear deal with Iran.

Even an informal understanding with Iran, with US concessions and limited, reversible steps by Iran to curtail its nuclear program, will face criticism. Israeli Prime Minister Benjamin Netanyahu said on Tuesday his government wouldn’t be bound by any such deal. It is also a departure from the so-called stronger and longer nuclear deal Biden said he would negotiate.

Since the US reimposed sanctions in 2018, Iran has expanded its nuclear work and has been accumulating 60 per cent-enriched uranium for over two years, the only non-nuclear-weapons state to do so. Iran already has enough 60 per cent material for at least two nuclear weapons and can convert it into weapons-grade enriched uranium in a matter of days, US officials say.

Western officials worry that a move by Iran to produce weapons-grade fissile material would trigger a diplomatic crisis. Israel has said that level of nuclear production could trigger a military strike. There have been no formal negotiations on the nuclear deal since last US summer, when Iranian officials in Vienna walked away from a proposed deal.

The Wall Street Journal