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June 11, 2012

Iran News Round Up: June 11, 2012

Recap from Last Week:
After IAEA inspectors and Iranian negotiators failed to reach an agreement in Vienna last week, doubts have surfaced that suggest that talks between the P5+1 and Iran scheduled for next week might fall through. (ABC News 6/10/12) An Iranian negotiator stated Sunday that the talks could stall as a result of “faulty preparation”. This comment comes only days after representative from the P5+1 insisted that further preparatory talks weren’t necessary in response to an Iranian complaint that an agenda had not been finalized for the upcoming talks. (The Guardian 6/7/12) The P5+1 is apparently united in its goal of halting Iran’s enrichment at 20%.  Ahmadinejad said the parties must explain what concessions they will provide in exchange for such an Iranian concession. (ABC News 6/10/12)
IAEA Inspections:
US-Iranian relations were over the weekend further agitated when reports by the UN nuclear watchdog surfaced claiming that Iran had demolished buildings at the Parchin military base in an alleged attempt to cover up nuclear testing. (Boston Globe 6/11/12) Iranian officials have denied the reports, calling the allegations “irrelevant and unwise”. The IAEA claims that satellite images reveal “a cleanup of the site, saying the photos depicted water streaming out of one building, the razing of several other buildings and removal of earth at the facility.” (The Times of Israel, 6/11/12; Boston Globe 6/11/12) Iran maintains that Parchin is a “conventional military base”. Additionally, despite failed talks last week, Ali Asghar Soltanieh said that Iran would “not block assess of the IAEA inspectors to Parchin, ‘if both Iran and the agency reach an agreement on the modality of a visit”. (Boston Globe 6/11/12)
IPS published an article suggesting that the “sanitized” site is merely part of a ploy by Iran to gain more bargaining power in Moscow. The article claims, “the activities shown in those satellite images show activities appear to be aimed at prompting the IAEA, the United States and Israel to give greater urgency and importance to a request for an IAEA inspection visit to Parchin in the context of negotiations between Iran and the IAEA”. (IPS 6/8/12)
Deterioration of Economic Conditions in Iran:
Ahead of the talks next week, economic indicators suggest the Iranian economy is continuing to feel the pinch of multilateral sanctions. Additionally, however, falling oil prices recently have further exacerbated Iran’s economic lull. (Reuters 6/11/12) According to IMF indicators, Iran, in order to balance its books for the fiscal year will need oil to rise to $117 per barrel. Additionally, the sharply falling oil prices have worsened the effects of already out of control inflation, increasing the burden on working families. Last week oil prices fell to a 16-month low, partially as a result of instability and doubt in European, Chinese, and American markets. By some estimates Iran has already, as a result, foregone over $10 billion in oil revenue this year. (Reuters 6/11/12)
Potential Saudi-Iranian Rivalry:
Oil prices, coupled with the embargo on Iranian oil, have soured the relationship between Saudi Arabia and Iran significantly, and some are speaking of a Saudi-Iranian rivalry in the oil markets further spoiling regional stability. When OPEC nations meet in Vienna, the issue of overproduction by the Saudis under pressure from nations who have sworn off Iranian oil is likely to be a hot topic. Iran sees loss, where the Saudis stand to gain in terms of demand, and overproduction by the Saudis has then further pushed the price of oil down. (Nasdaq 6/11/12) Saudi Arabia is, however, likely going to be unwilling to see Iran’s side, as Iranian production continues to fall. (Nasdaq 6/11/12)
Investigation into Executive Leaks:
In other news, leaks from the White House regarding the Obama administration’s leaks of information regarding an alleged cyber attack on Iran’s nuclear program continued to unfold. A team of federal investigators and prosecutors is to be elected to conduct further exploration and discovery work. Senator Feinstein (D-CA), of the Senate Select Committee on Intelligence, and Representative Rogers (R-MI), of the House Select Committee on Intelligence discussed the leaks on CBS’s “Face the Nation” yesterday. (Bloomberg 6/11/12)

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