With the intense escalation between Iran and the US, and the potential for French mediation efforts to unravel, Europe must think carefully about its next move

Tensions between Iran and the United States have risen to a dangerous new level. Recent attacks on Saudi Arabia – which the US blames on Tehran – severely disrupted global oil supplies, prompting President Donald Trump to consider tapping into US strategic reserves and, once again, threaten military action against Iran. Yet the events of recent months only hint at how bad things could become. At the UN General Assembly, European leaders must make another joint push to ease these tensions, warning both sides that they may soon be unable to break the cycle of escalation.

Trump now has two broad options. One is to intensify the US “maximum pressure” campaign largely designed by former national security adviser John Bolton. This policy has neither achieved the president’s stated goal of a new nuclear deal nor weakened Iran’s hand in the region. Instead, in the space of three months, Trump has twice faced a dilemma about whether to carry out a military strike on Iran in response to attacks in the Gulf. Iran has warned that, if targeted by the US, it will launch an “all-out war” – which would likely mire the entire region in conflict.

Alternatively, Trump could use the latest round of escalation to explore the diplomatic opening with Iran created by French President Emmanuel Macron. Since May, Iran and the US have made several major attempts to increase their leverage over each other through escalatory behaviour. The White House has used sanctions to hit Iran’s economy hard, proving that these unilateral measures can drastically reduce global trade with the country. Meanwhile, Tehran has tried to obtain bargaining power by reducing its compliance with the nuclear deal and displaying its military capabilities, aiming to persuade all nations that they will pay for the maximum pressure campaign.

European countries should attempt to convince both sides that now is the time to use this leverage in negotiations rather than provoke each other further. While it seems that Iran and the US realise that they must eventually strike a deal with each other, neither side is willing to make the first concession required to begin talks. They both believe that time is on their side. The leaders of the Islamic Republic of Iran have outlasted successive US presidents – and they are confident that they can do the same with Trump. Meanwhile, the US bets that it can endlessly sanction Iran and manage retaliation until Iranian leaders make the first move towards negotiations.

A looming election

This diplomatic endeavour is no easy task. Since May 2018, when Bolton entered the White House, the stringency of US sanctions on Iran has significantly constrained Trump’s opportunities to pursue direct negotiations with the country. Facing a re-election battle, he may find that his freedom of action has been limited by his hawkish donors, such as Sheldon Adelson. For this reason, Trump could have greater political space to make concessions if he wins a second term as president.

Tehran is also boxed in. Given the US attempt to throttle Iran’s economy and share of the oil market, Iranian leaders believe that they have been forced to retaliate. This escalatory behaviour could soon cost Iran Europe’s political support and patience on the nuclear deal. Yet without flexibility from the US on sanctions, Iran faces an array of bad options and will need to pick the one that rejuvenates its economy without requiring full capitulation to US demands. Given the realities of US domestic politics, some Iranian leaders argue that it is better to wait until after the 2020 US presidential election than to make concessions to a president who could soon leave office.

However, Iran and the US are engaged in intense escalation. If the two sides do not begin to reduce tensions with each other, they may squander any leverage they have gained.

A last push for European mediation

With Bolton gone and regional security deteriorating, there is now an urgent need for a change in approach. Macron may have proposed ways to open the door to talks, but it is up to Tehran and Washington to take action.

Over the summer, Macron pushed for an initiative to provide Iran with a $15 billion credit line in exchange for full compliance with the nuclear deal and engagement in wider negotiations. However, the events of the past week could derail or significantly delay this process.

Macron may have proposed ways to open the door to talks, but it is up to Tehran and Washington to take action.

Trump has expressed an interest in this plan following the G7 summit. The credit line can only work if the US grants Europe several sanctions waivers. Until recently, it seemed that the parties were not far from finalising these measures. (There are rumours that Trump sought a high level meeting with Iran in exchange for such waivers.)

After weeks of shuttling between Tehran and Paris, Iranian President Hassan Rouhani seems eager to finalise such a deal, returning to full compliance with the nuclear agreement for as long as the credit line lasts. Iran is highly unlikely to agree to a meeting between heads of state, but there are some signs that it would be open to a lower level meeting with the US in a multilateral setting, which Europeans could provide. By backing these initial steps, Trump could pave the way for a bigger breakthrough with Iran.

The costs of diplomatic failure

The French mediation effort is currently the only path to avoiding further escalation. If the French initiative unravels at UN General Assembly, there may be no European leader still willing to mediate between Tehran and Washington.

This could have disastrous repercussions for the Middle East and beyond. Iran has many ways to damage US interests, including by disrupting any American withdrawal from neighbouring Afghanistan. Despite the US administration’s claims that it has weakened Tehran with its attacks on the nuclear deal and a tsunami of sanctions, Iran now feels emboldened to lash out.

The US and Israel – and, potentially, Saudi Arabia – are considering direct overt and covert strikes on Iran. Israel is already openly attacking Iranian assets in Syria and, seemingly, Iraq. The US has also reportedly conducted cyber attacks on Iran (which are likely to increase). Cumulatively, these efforts ramp up the escalation – and are certain to significantly do so if there are direct military strikes.

In this climate, European leaders should use the UN General Assembly to emphasise that, the longer Iran and the US continue on their current path, the more likely they are to stumble into a military conflict that neither wants. European diplomats should primarily focus on personal outreach to Trump, to underscore that only he can shift the current dynamics by creating breathing room for diplomacy. European governments should warn him that, if the US steps up its maximum pressure campaign, the costs will continue to rise not just for US and Europe but also for Trump. In the run-up to US election season, he will likely face continual cycles of escalation with Iran, fluctuating oil prices, and perhaps a slide into another Middle Eastern conflict.

Read more on: The Middle East and North Africa, Iran