New Iran deal 'could ease oil price pressures caused by Ukraine war'

A revival of Iran’s nuclear deal could help ease global oil prices by bringing a major producer back into the market, Ireland’s foreign minister said.

Simon Coveney, who is playing a significant role in trying to save the Joint Comprehensive Plan of Action (JCPOA) agreement, said he hoped progress could be made within days.

The deal, which eases sanctions on Iran in exchange for Tehran giving up ambitions to build a nuclear weapon, has faltered since then US president Donald Trump pulled out in 2018.

Russia is one of the signatories to the JCPOA deal and the invasion of Ukraine has complicated efforts to save the deal because of the sanctions imposed on Vladimir Putin’s country.

The JCPOA was agreed in 2015 by Iran, the five permanent members of the UN Security Council – the UK, US, France, China and Russia – and Germany.

Coveney’s involvement stems from his role as the UN Security Council’s facilitator for the deal.

The US, UK and European Union are seeking to break away from Russian oil and gas, and Coveney said: “Certainly having a big new player in the market, if you like, Iranian crude oil coming back into the market with the removal of sanctions, would be a very attractive prospect in terms of reducing pressure on oil prices, because of sanctions on Russia, which are likely, I think, to remain for quite some time.”

He said: “I think that is an added incentive to try to get a deal done now.”

Following Joe Biden’s election as President efforts have stepped up to salvage the agreement, with 11 months of on-and-off talks in Vienna appearing to be on the cusp of a breakthrough.

Coveney told BBC Radio 4’s Today: “What certainly has been a problem for the last 10 days or so is that the sanctions that now apply to Russia – because of their illegal war in Ukraine and the brutality that we’re seeing and the potential war crimes on a daily basis that we’re seeing – meant that Russia was concerned that they would not be able to benefit from the removal of sanctions on Iran as a result of signing off on a deal.

“And that has caused tension and delay. But that seems to have been resolved in the last few days”.

Coveney said “we look as if we’re almost there” and “that’s a good news story when the world needs one”.