May 25 (Bloomberg) -- Iran and world powers agreed to hold a new round of talks about the Persian Gulf nation’s nuclear program next month after failing to bridge differences during two days of negotiations in Baghdad.
Negotiators from the U.S., the U.K., France, Germany, China and Russia plan to meet their Iranian counterparts June 18 and 19 in Moscow. It will mark the third attempt in three months to address international worries that Iran’s atomic energy program may be a cover for secret weapons work, and Iran’s concerns about sanctions and diplomatic isolation.
“It’s clear that we both want to make progress and that there is some common ground,” European Union foreign policy chief Catherine Ashton told a news conference yesterday in the Iraqi capital. “However, significant differences remain” and “we do agree on the need for further discussion to expand the common ground.”
One significant difference that came out of the Baghdad talks was the Iranian desire to have the nations recognize its “right” to enrich uranium, said a U.S. official, who briefed reporters on the condition of anonymity because the negotiations are private.
Iran went into the meeting seeking relief from at least some U.S. and European Union sanctions on oil, banking, insurance and trade that have hobbled its economy. That would require verifiable and sustained evidence of Iran resolving concerns about its nuclear program, U.S. and Western diplomats in Washington said on condition of anonymity before the talks began.
The six major powers want Iran to curtail uranium enrichment as a step toward building trust in negotiations and to address a capability that troubles Israel because that process can be used to make fuel for nuclear weapons.
Wendy Sherman, the U.S. undersecretary of state and lead American negotiator on the Iranian nuclear issue, completed talks in Baghdad and was due today in Tel Aviv, where she will “reaffirm our unshakable commitment to Israel’s security,” according to a State Department statement.
Israel, which says Iran wants to destroy the Jewish state, has threatened a military strike if negotiations and sanctions fail to halt what they believe is Iran’s progress toward a nuclear bomb. U.S. intelligence officials say Iranian leaders haven’t made a decision on whether to seek a weapons capability.
Iran insists its program is for civilian energy and medical research, and Supreme Leader Ayatollah Ali Khamenei has issued a religious edict saying nuclear weapons are against Islam. Under international safeguards, Iran now enriches uranium to 3.5 percent purity for civilian reactors and to 19.75 percent for the production of medical isotopes.
One priority for the six powers is to address Iran’s growing stockpile of 19.75 percent medium-enriched uranium, which is a short processing step from the 90 percent purity needed for weapons fuel. Iran’s known enrichment facilities are under surveillance from the UN’s International Atomic Energy Agency, which hasn’t cited evidence that enriched uranium has been diverted to military use.
Iran’s top nuclear negotiator, Saeed Jalili, told reporters in Baghdad that while his country would consider discussing its stockpile of 19.75 percent-enriched uranium, the Islamic republic considers enrichment an “inalienable right” under international law.
Secretary of State Hillary Clinton told reporters yesterday in Washington that the six powers in Baghdad “set forth a detailed proposal focused on all aspects of 20 percent enrichment based on concrete step-by-step reciprocal measures. We had intensive discussions with the Iranians on our proposal. They put forth their own ideas. As Lady Ashton said, significant differences remain.”
Clinton said the U.S. would “keep up the pressure” and vowed that all U.S. “sanctions will remain in place and continue to move forward during this period.” Under a new U.S. law due to go into effect June 28, financial institutions in nations that do not reduce significantly their imports of Iranian oil may be cut off from the U.S. banking system if they try to settle oil trades with Iran’s central bank or sanctioned Iranian banks.
Negotiators will discuss sanctions during the next round of talks in Moscow, Iran’s deputy nuclear negotiator, Ali Bagheri, said in Baghdad. The Persian Gulf country’s oil exports are already down 500,000 barrels a day and may fall another 300,000 to 500,000 barrels a day when an EU oil embargo takes effect July 1, Barclays Plc said this month.
Jalili said his government is counting on the “window for cooperation” remaining open and expects future discussions to bear “fruitful” results.
Crude prices fell earlier this week after Iran agreed to wider United Nations atomic inspections. Oil rose after yesterday’s negotiations failed to produce an accord. Crude for July delivery gained 76 cents to settle at $90.66 a barrel on the New York Mercantile Exchange.
“There was never going to be a breakthrough in this meeting,” Dennis Ross, who served as President Barack Obama’s chief adviser on Iran, said in an interview. The Iranians, he said, “were never going to approach the negotiations by offering a lot to begin with because they want to see what they can get by offering the minimum.”
Ross said it was too soon to know if anything will change in three weeks at the next meeting, though he said the six powers have made clear “they will not simply accept anything and are willing to let the pressure build on the Iranians.”
Bijan Khajehpour, an Iranian economist and consultant who has studied the impact of sanctions on Iran’s economy, said in Washington yesterday that he was not surprised that a deal was not reached in Baghdad because “there was as mismatch between expectations” on the Iranian side and the international community.
The Iranian nuclear negotiators, he said, would never have accepted the six powers’ offer to exchange Iran’s stockpiles of 19.75 percent enriched uranium for fuel plates for the Tehran medical research reactor, because that deal is a repackaging of a 2009 offer that ultimately fell apart. The Tehran research reactor uses medium-enriched uranium to produce medical isotopes for treating cancer patients.
“I always urge the negotiators to study the Iranian mentality and culture,” he said. The Iranian side’s position, he said, can be summed up like this: “Something we offered to you a couple years ago and you now give it back to us? We can’t accept that, it’s humiliating,” he said.
Aaron David Miller, a Middle East specialist at the Woodrow Wilson Center for International Scholars in Washington, cautioned that both sides in the talks need to be ready to make important concessions. In seeking an ideal agreement, “the perfect can’t be the enemy of the good,” he said.
“These talks were always going to be challenging, because making progress means tackling the thorniest issues that have divided the two sides for years,” said Trita Parsi, president of the Washington-based National Iranian American Council. “Both sides entered negotiations with their maximalist positions, and neither budged.”
The six nations negotiating with Iran remain in close agreement on their approach, according to the U.S. official who briefed reporters. At the suggestion of the U.S., the Chinese and Russians held separate talks with the Iranians to show that they were on the same page as the Americans and Europeans, the official said.
The Moscow talks will be the third round of negotiations, following an April meeting in Istanbul and this week’s discussions in Baghdad.
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