How Iran is pursuing a high-risk/high-reward strategy to gain an edge in talks with Biden

• An uptick in Iranian nuclear and naval activity since December 31 risks provoking a response in the region, including from the US.
• The activity is part of an effort by Iran to increase the cost of maintaining sanctions to the US and its allies and ensure the Biden administration prioritizes negotiations with Tehran upon taking office.
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Security risks, including threats to tanker traffic, in the Persian Gulf and Iraq will remain heightened after US President-elect Joe Biden takes office, despite his intent to enter negotiations with Tehran.

The uptick in Iranian nuclear and naval activity since December 31 risks provoking a military response in the region from foreign actors, including a potential US strike on Iranian soil.

• On January 3, Acting US Secretary of Defense Christopher Miller announced that the USS Nimitz would forgo its redeployment away from the Middle East due to “recent threats issued by Iranian leaders against President Trump and other US government officials.”
• Although the Pentagon did not specify what Miller was alluding to, the comments come after a December 31 statement made by Iranian President Hassan Rouhani was initially translated as saying Trump would be ousted from “life.” Iranian officials have since this was a mistranslation, specifying that Rouhani was referring to Trump’s “political life.”

The reversal of the USS Nimitz’s plans comes amid a series of recent Iranian acts of aggression:

• December 31: A suspicious object suspected to be a limpet mine was found on a tanker near Iraq’s Al Basrah Oil Terminal (ABOT). Iran is believed to have been behind the incident.
• January 1: Iran notified the International Atomic Energy Organization (IAEA) that it planned to begin boosting uranium enrichment levels to 20 percent at the Fordow Fuel Enrichment Plant. The IAEA confirmed on January 4 that Iran had begun the process.
• January 4: Iran ostensibly detained the South Korea-flagged Hankuk Chemi tanker, which was transiting the Persian Gulf en route to the United Arab Emirates, for allegedly polluting the waters.
• January 5-6: Iran’s army is planning to hold two-days military exercises involving multiple unarmed aerial vehicles.

The tanker incidents signal that Iran remains willing to restart attacks against oil and gas infrastructure if the Biden administration does not include sanctions relief in negotiations.

In doing so, Iran hopes to increase the cost of maintaining sanctions to the United States and its allies. By forcing both a security and nuclear crisis, Iran’s leaders are seeking to ensure the busy Biden administration prioritizes negotiations with Tehran upon taking office.

If such pressure successfully yields sanctions relief, Iran’s conservatives and hardliners will then reap the political benefits in the upcoming June 18 presidential election – granting them more say in future talks with the West, as well as any potential economic and political reforms accompanying the relaxation of sanctions that could threaten their interests.

• Boosting enrichment to 20% is one of the steps mandated under a new law the Iranian parliament recently passed that aims to ramp up Iran’s nuclear program over the next six months.
• In 2019, Iran launched several attacks against tankers in the Persian Gulf and Saudi Arabian oil infrastructure. The last significant attack occurred in September 2019, against Saudi Arabia’s Abqaiq and Khurais oil processing facilities.

Iran’s high-risk/high-reward strategy will increasingly threaten the physical security of targets in its immediate periphery by raising the risk of punitive strikes from the United States and Israel.

Washington and Israel will view the increase in uranium enrichment levels to 20% as particularly worrisome, as stockpiling of uranium enriched to that level would substantially reduce the time needed to make a weapon. In his remaining few weeks in office, Trump appears to be more willing to conduct a physical strike against Iran than his successor.

Any actions that directly target US interests or result in American casualties in the coming days – such as the harassment of US vessels transiting the Persian Gulf, or the deaths of US soldiers in Iranian-backed militia attacks in Iraq or Syria – are most likely to prompt a response from the outgoing Trump administration. Even after Biden takes office, Israel will also still consider unilateral action against continued Iranian acts of aggression, particularly against Iran’s nuclear program.

• Maritime traffic will face an increased risk of being targeted over the next few months, particularly tanker traffic linked to Western countries or countries viewed as backing the US position against Iran. Specific threats would include unsafe approaches by Iranian vessels, armed boardings to detain crewmembers, and the use of limpet mines.
• Iran is less willing to directly carry out frequent attacks onshore Saudi Arabia, Bahrain and the United Arab Emirates for fear of further weakening Iran’s fraught negotiating capital with those states, as well as emboldening US demands that Iran’s missile and drone program be included in talks. But infrequent attacks against these neighboring countries akin to those seen in 2019 remain possible.
• Iran will also likely bolster its capacity to carry out cyberattacks in the region, including against both commercial and government targets. Less frequent, Iran-backed hacks against targets beyond the Middle East also cannot be ruled out.

Iran’s aggressive strategy may initially unlock some sanctions relief, though it will come at the cost of hardening the international community’s position against Tehran in longer-term negotiations.

Over the last two years, Iran has demonstrated that it is willing to use its missile and drone capabilities to target commercial interests in the region. The continued use of such tactics will push European countries into broader alignment with the United States on the need for broader ongoing talks with Iran in order to ink a new nuclear deal, as well as discuss other concerns beyond just Tehran’s nuclear program.

This desire to include other issues in talks will make full normalization between the West and Iran difficult to achieve without a significant change in policy. Iran is hoping that the fear about broader conflict and its nuclear ambitions will at least keep the United States and European countries’ most effective countermeasure – broad sanctions – reserved for Tehran’s nuclear program in order to avoid having to make more significant concessions on other parts of its national security.

• In a January 3 interview with CNN, incoming National Security Advisor Jake Sullivan said that Iran’s ballistic missile program should be included in “follow-on” negotiations.