Middle East Ticker

U.S. Reimposes Sanctions on Iran, New Wave of Islamic State Attacks, Calls for Yemen Ceasefire Fail to Halt Fighting in Hodeidah

By J. Dana Stuster
Tuesday, November 6, 2018, 1:30 PM

U.S. Hits Iran with Second Wave of Sanctions

The United States imposed a second tranche of sanctions against Iran on Monday, November 5, as part of its withdrawal from the Joint Comprehensive Plan of Action. The sanctions target Iran’s oil and shipping industries and will constrain Tehran’s access to international markets and insurance; the new measures follow a wave of sanctions in August that primarily affected currency and precious metals. The U.S. government has warned for months, since it announced its withdrawal from the nuclear agreement in May, that the sanctions were coming and that companies investing in the Iranian market and countries reliant on Iranian oil imports should wind down their business.

The Trump administration has emphasized that it will enforce the sanctions, but announced recently that it would issue waivers to eight countries—including China, Japan and India—that have made “important moves” in reducing their purchases of oil and other Iranian exports but not cut off their supply completely. U.S. Secretary of State Mike Pompeo said two of the countries that have been issued waivers have plans to ramp down imports of Iranian oil to zero in coming months. The waivers were supported by Pompeo and Treasury Secretary Steven Mnuchin, who won out over national security advisor John Bolton’s recommendation of denying waivers and enforcing sanctions against U.S. allies and trading partners. “The national security adviser argued that the waivers ... were too generous toward Iran, according to a person familiar with the administration’s internal debate,” according to a report from Bloomberg. The administration has also faced criticism from some members of Congress for not completely severing Iran’s access to the financial messaging service, Swift, but the Belgium-based service said Monday it would partially comply with the new sanctions and block access for some Iranian banks.

Iranian officials have said in recent months that maintaining access to large foreign oil markets would be critical to withstanding pressure from the sanctions regime. “If China … buys Iran’s oil, we can resist the U.S.,” one Iranian economic analyst told the Financial Times in July. Faced with a choice between undermining the effectiveness of its sanctions or undermining its diplomatic and trade relationships with some of the largest countries in the world, the Trump administration chose the former. The United States will face additional challenges to enforcing the sanctions, as well. As Richard Nephew noted in a brief for Columbia University’s Center on Global Energy Policy, the United States will have to work through complications presented by Europe’s efforts to maintain the nuclear agreement and oppose the U.S. sanctions regime, and high oil prices may allow Iran to keep its economy afloat despite reduced exports.

U.S. cabinet officials defended the sanctions policy in op-eds this week. Both Mnuchin and Secretary of Energy Rick Perry stressed that the sanctions are aimed at the Iranian regime, not the Iranian people. But the reimposition of sanctions and the Iranian economy’s uncertain prospects have already made life more difficult for some Iranians. Rising inflation means the Iranian rial doesn’t go as far today as it did just a few months ago. “While the US is seeking to change the behaviour of the regime in Tehran, it is poor Iranians who are likely to bear the brunt of the sanctions,” the Financial Times reported after interviewing Iranians who were struggling to afford fresh food or were looking for additional employment.

The run-up to the reimposition of sanctions on Monday was accompanied by diplomatic bickering and posturing—which in 2018 means that the president of the United States posted a Game of Thrones-themed meme on Twitter boasting that “Sanctions are Coming,” to which Qassem Soleimani, commander of the Revolutionary Guards’ Quds Force, replied on Instagram with his own Game of Thrones meme, declaring “I will stand against you.” “It was a sophomoric, ego-driven stunt that only served to underscore the administration’s hubris in launching an assault against Iran that appears to have no achievable end game,” Brookings’ Suzanne Maloney wrote on Monday.

Iran is now bracing for the increased pressure. As Maloney explains, Iran is storing more of its oil reserves abroad in China and is expanding non-sanctioned trade within the region. “All these contrivances will surely enable Tehran to muddle through with a combination of mitigation, improvisation, and greater institutional capacity than outside analysts typically presume, just as its leadership has during even more severe episodes of financial constraints and externally-imposed pressure,” she wrote. “However, the presumption that the Iranian leadership can simply choose to wait out the sanctions is plainly unrealistic. The capacity to ride out tough times does not imply a readiness to submit to an indefinite siege, particularly at a time when public patience with economic malaise is already running thin.”

Iranian Foreign Minister Javad Zarif told USA Today over the weekend that Iran would be open to new negotiations with the Trump administration. "Mutual trust is not a requirement to start negotiations—mutual respect is a requirement," he said. Whether those negotiation would go anywhere would depend on what the Trump administration hopes to accomplish, which remains somewhat unclear. Trump has said he would meet with Iranian President Hassan Rouhani with “no preconditions,” but the administration’s snowballing list of demands, first introduced in May and expanded in July, is a non-starter for the Iranian regime.

Coalition Operations Against Islamic State Stall

Militants set off four bombs in Baghdad on Sunday evening, killing four people and wounding 20 others. The bombs went off during rush hour and two were detonated from inside commuter vans. Two of the attacks targeted the Shia neighborhood of Sadr City and one appeared to target a military convoy in Tarmiyah. The Islamic State claimed credit for the attacks, as well as another bombing on Sunday in its former de facto capital, the eastern Syrian city of Raqqa. Farther abroad, the Islamic State has also asserted responsibility for an attack on Coptic Christians in Egypt; at least seven people were killed and 16 wounded last Friday when gunmen opened fire on two buses of pilgrims visiting a monastery south of Cairo.

Despite its major battlefield defeats, the Islamic State is still lingering, holding a small sliver of territory on the Syria-Iraq border and operating as a guerilla force elsewhere. U.S.-backed forces have had difficulties in their campaign to clear militants from the Hajin pocket, the last Islamic State-held land in Syria. The Syrian Democratic Forces (SDF), a coalition of Syrian militias fighting the Islamic State with support from the United States, launched an offensive to capture the region on September 10, but by the end of October it had lost as much ground as it had gained. The Syrian Observatory for Human Rights reports that more than 300 SDF fighters and 500 Islamic State militants have been killed in the last two months; another 2,000 Islamic State militants remain in the area, according to the estimates from the counter-ISIL coalition. Operations have been mired by mines, other explosive traps and a fierce counterattack during a sandstorm.

The U.S. Department of Defense is warning that the political instability in Iraq and continued sparring between factions in Syria could allow the Islamic State to reconsolidate. A new report from the department’s inspector general warns that the Islamic State “exploited” infighting within the coalition “to recruit new members, gain resources, and conduct attacks.” The United States has tried to defuse some of the tensions between U.S.- and Turkey-backed militias in the coalition, and on November 1 began joint patrols with Turkey around the contested city of Manbij. U.S. defense planners hope the joint patrols can pacify potential flashpoints in northern Syria and allow greater attention to the Islamic State’s remaining presence, but Turkish President Recep Tayyip Erdogan has continued to threaten new military operations against Kurdish forces in the area. In a speech on October 30, Erdogan promised to “destroy the terror structure east of the Euphrates River,” adding that Turkey has “completed preparations and plans regarding this issue.”

Saudi-backed Forces Advance in Yemen after Calls for Ceasefire

Pro-government Yemeni fighters backed by Saudi Arabia and the United Arab Emirates are advancing toward the Houthi-held city of Hodeidah after attacking the Houthis’ supply line last week. The United Nations and humanitarian organizations have warned for months that an attack on the city could disrupt the operations of its port, a conduit for 80 percent of the aid that enters the country. Both sides have said previously said they would avoid fighting in the vicinity of the port, and the Saudi coalition had halted its advance for months, but over the weekend Reuters reported clashes around the eastern entrance to the city and a university just a couple miles south of the port. Human rights groups are now warning that thousands of civilians have been trapped by the fighting.

The new offensive comes as the United States and others are calling on the Houthis and Saudi Arabia and its partners to wind down fighting in Yemen and enter peace talks. In a statement released last week, U.S. Secretary of State Mike Pompeo said that “[s]ubstantive consultations under the UN Special Envoy must commence this November” and demanded a reciprocal “cessation of hostilities.”

The United States, which has provided logistical support to the Saudi coalition throughout its intervention in Yemen, has previously been reluctant to put public pressure on Riyadh, despite strong criticism of U.S. support for Saudi operations. But the disappearance and apparent killing of Saudi dissident Jamal Khashoggi and Saudi Arabia’s continued indiscriminate bombing of civilian targets seem to have shifted U.S. policy. President Trump issued a surprisingly stern rebuke of Saudi Arabia’s conduct in an interview with Axios, saying that the Saudi military did not understand how to operate the weapons the United States had sold to the kingdom and that a Saudi airstrike that hit a school bus full of children was “a horror show.” Trump suggested that he would be pressing the Saudis to change their course of action. "I'll be talking about a lot of things with the Saudis," he said, "but certainly I wouldn't be having people that don't know how to use the weapons shooting at buses with children."

“The administration has promised its support for the UN negotiations with much more coordination and emphasis than ever before,” Brookings’ Bruce Riedel wrote for Al-Monitor. The premeditated murder of Jamal Khashoggi by the Saudis has put the administration under unprecedented pressure to rein in Crown Prince Mohammed bin Salman’s reckless and dangerous behavior.” Adam Baron noted in Foreign Policy that Khashoggi’s death has also strained ties within the Saudi coalition, alienating some pro-government Yemenis, particularly those with ties to the Islah Party.

It is unclear where the war goes from here. The Saudi advance on Hodeidah may be a last effort to jockey for a negotiating advantage or to “escalate to deescalate” (in other words, to disrupt a stalemate with a crisis that forces a diplomatic resolution). "The coalition is committed to de-escalating hostilities in Yemen and is strongly supportive of the UN envoy's political process," an anonymous Saudi source told AFP on Monday. Or it could be the start of a brutal campaign to push back the Houthis at any cost. Especially now that Mohammed bin Salman’s rule is a concern at home and abroad, Riedel wrote, the crown prince is “is reluctant to appear to back down in Yemen.” Either way, the next month could be particularly deadly.