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UPDATE 1-U.S. may weigh baby steps to revive Iran nuclear deal

Arshad Mohammed and John Irish
·4 min read

(Adds State Department comment, paragraphs 18-19)

By Arshad Mohammed and John Irish

WASHINGTON/PARIS, Feb 8 (Reuters) - The United States isweighing a wide array of ideas on how to revive the Iraniannuclear deal, including an option where both sides would takesmall steps short of full compliance to buy time, said threesources familiar with the matter.

Such a modest approach could slow the deterioration inrelations since former U.S. President Donald Trump abandoned thedeal in 2018 and freeze Iran's subsequent violations, which havebrought it closer to enriching weapons-grade uranium.

This option could entail Washington allowing Tehran to geteconomic benefits less valuable than the sanctions relief itreceived under the 2015 deal in return for Iran stopping, orperhaps reversing, its own breaches of the agreement.

The sources stressed U.S. President Joe Biden has yet todecide his policy. His stated position remains that Iran resumefull compliance with the pact before the United States will.

"(They) are having a real think," said one source familiarwith the U.S. review, saying ideas under consideration include astraight return to the 2015 nuclear deal and what he called"less for less" as an interim step.

Another source said if the Biden administration concluded itwould take too long to negotiate a full return to the deal, itcould adopt a more modest approach.

"Should (they) at least try to give Iran some sanctionsrelief and get Iran to agree to pause and maybe roll back someof its nuclear (steps)?" said this source.

The deal between Iran and six major powers limited Iran'suranium enrichment activity to make it harder for Tehran todevelop nuclear arms - an ambition Iran has long denied having -in return for the easing of U.S. and other sanctions.

When Trump left the deal in 2018, faulting it for failing tocurb Tehran's ballistic missile program and backing for regionalproxies, he reimposed crippling sanctions on Iran's economy.

In response, Tehran has breached the deal's key limits,enriching uranium to 20% - above a 3.67% cap but below the 90%needed for weapons - expanding its stockpile of low-enricheduranium, and using advanced centrifuges for enrichment.

WHO MAKES FIRST MOVE?

A central problem in reviving the deal is who goes first.Iran has insisted the United States ease sanctions before itresumes compliance; Washington wants the reverse.

In what may be posturing by both sides, Iran's SupremeLeader Ayatollah Ali Khamenei on Sunday said Tehran's "final andirreversible" decision was to return to compliance only ifWashington lifts sanctions, while Biden said he would not liftsanctions just to get Iran back to the table.

Republicans are likely to criticize the Democrat Biden if heoffers Iran any sanctions relief without their full return tothe agreement, arguing this would squander leverage that Trumpbuilt up with the scores of sanctions imposed since 2018.

"The Biden admin has to recognize the realities of 2021, not2015. That means no upfront sanctions relief for a regime that'sonly expanded its dangerous behavior," Trump's former U.N.ambassador Nikki Haley wrote on Twitter on Sunday.

Washington could find other ways to ease Iran's economicpain, smoothing the way for the International Monetary Fund tolend to Tehran, making it easier for humanitarian goods to getthrough, or embracing a European idea for a credit facility.

A Western diplomat said an IMF loan "definitely could be inplay" and described the possibility of a European creditfacility for Iran, which would require the tacit acceptance ofthe United States, as "sensible and feasible."

The White House declined comment beyond spokeswoman JenPsaki's statement that if Tehran resumed compliance, Washingtonwould do so and that "the ball's in Iran's court."

A State Department spokeswoman, speaking on condition ofanonymity, said the Biden administration was still consultingCongress as well as allies and partners.

"We are exploring a range of ideas consistent with ourstated policy of being willing to return into compliance withthe deal if Iran is," she said, without elaborating.

It was unclear how soon the Biden administration may settleon its approach.

One deadline is Feb. 21, when an Iranian law obliges Tehranto end the sweeping inspection powers given to the U.N. nuclearwatchdog by the 2015 deal and limiting inspections to declarednuclear sites only.

Three European diplomats said even the window for an interimsolution could close rapidly before Iran's June presidentialelection, which anti-U.S. security hawks are expected to win.

"It's an urgent situation. If we can't take advantage of thewindow now, it's very hard to think that we will be able toengage in substantial negotiations before the autumn," said one."The current (nuclear) trajectory could close a lot of doors."(Reporting by Arshad Mohammed and John Irish;Writing by Arshad Mohammed; Editing by Howard Goller)