Iran nuclear deal: Trump announces US withdrawal, reinstates sanctions

US President Donald Trump | Photo: Reuters
US President Donald Trump on Tuesday announced the withdrawal of the landmark Iran nuclear deal, an Obama-era accord which he has repeatedly criticised and signed a fresh set of sanctions against the country.

Trump also warned countries against any cooperation with Iran on its nuclear weapons programme.

"It is clear to me that we cannot prevent Iran's nuclear bomb. The Iran deal is defective at its core. Therefore, I am announcing today that the United States would withdraw from the Iran nuclear deal," Trump said.

Trump informed French President Emmanuel Macron of his decision earlier on Tuesday, according to the Times. Macron's office later said Trump had not given the French leader any indication of his decision. 

The Iran deal, also known as Joint Comprehensive Plan of Action (JCPOA), is an international agreement reached on July 14, 2015 between Iran and six world countries - China, France, Russia, Britain, the US and Germany, plus the EU.

Iran, in a pact with the world powers, had agreed to halt its nuclear programme in return for an easing of economic sanctions on Tehran.

Top 10 developments on Iran nuclear deal and US President Donald Trump decision

1. Trump pulls out of Iran nuclear deal: The US president on Tuesday, who has long criticized the Iran deal as the 'worst' ever, pulled out of the Iran nuclear deal, also known as the Joint Comprehensive Plan of Action or JCPOA.

"It is clear to me that we cannot prevent Iran's nuclear bomb. The Iran deal is defective at its core. Therefore, I am announcing today that the United States would withdraw from the Iran nuclear deal," Trump said.

2. Wall Street drops in choppy session on uncertainty over Iran deal: Wall Street was lower in choppy trading on Tuesday. Stocks were lower for most part of the morning before sharply paring losses after CNN reported Trump was expected to impose sanctions on Iran, but may also allow for "a grace period that may offer the deal's proponents an opening to negotiate." But those moves evaporated just as quickly after the New York Times reported that Trump told French President Emmanuel Macron the United States was going to pull out. "We're getting conflicting reports about the Iran deal. The market will struggle until we get clarity on this," said Michael Antonelli, managing director, institutional sales trading at Robert W. Baird in Milwaukee. The S&P energy sector, which led a rally on Wall Street in the past two days, was down 0.7 per cent.

3. Impact on crude on Iran deal reports: Oil prices dived as much as 4 per cent on Tuesday as media reports rattled markets with doubts about whether U.S. President Donald Trump would withdraw Washington from the Iran nuclear deal as most had expected.

Brent crude futures were down 2.3 percent at $74.42 a barrel by 12:35 p.m. EDT (1635 GMT), while U.S. West Texas Intermediate (WTI) crude futures fell 2.8 percent to $68.73.

4. Gold slips as dollar hits 2018 high: Gold fell on Tuesday as the dollar surged to a new 2018 high, though the precious metal's losses were limited by worries the United States may be set to pull out of a key nuclear accord with Iran.

The decisions to leave the iran accord should raise risk aversion in the broader markets, helping gold, seen as a safe asset that holds its value in times of geopolitical turmoil, though the precious metal is for now under pressure from a strong dollar.

"A stronger dollar has created headwinds for gold but we don't see the dollar going much higher on a medium-term basis and in terms of geopolitics, there are some factors to keep an eye on," said Jens Pederson, senior analyst at Danske Bank.

Spot gold was down 0.6 percent at $1,306.26 per ounce at 1401 GMT. The precious metal has lost some 3.5 percent of its value over the last three weeks.

U.S. gold futures for June delivery were down 0.6 percent at $1,306.40.

5. Trump tells Kerry to 'stay away' from Iran talk: On Twitter, Trump said: "Stay away from negotiations John, you are hurting your country!" The US President said former US Secretary of State John Kerry "can't get over the fact that he had his chance and blew it" with Iran. Trump was reacting to reports that Kerry quietly has been promoting the Iran nuclear deal. Kerry was the lead negotiator on the deal for the Obama administration.

John Kerry can’t get over the fact that he had his chance and blew it! Stay away from negotiations John, you are hurting your country!

— Donald J. Trump (@realDonaldTrump) May 8, 2018
6. France says challenging Iran n-deal can escalate tensions: France's Defence Minister Florence Parly warned that challenging the 2015 Iran nuclear deal risks escalating tensions in "very eruptive region" and called for more efforts to improve the agreement. "It's not the best of agreements. (But,) it is a factor of peace and stabilization in a very eruptive region," Parly added. "It will be necessary to constantly continue to plead for the improvement of this agreement, whether the US is there or not," she said.

7. Iran prepares to export new oil grade amid sanctions threat: Iran has already been shipping samples of the grade to customers since production from the West Karoun oilfields in southwest Iran nearly doubled in the past year to 300,000 barrels per day (bpd), the sources said. A new export facility allows West Karoun to be shipped directly rather than blended with other grades. "Initial cargoes of West Karoun will be sold on a spot basis as the quality of the crude is yet to be established." said one of the two sources. This means that buyers have no obligation to take regular amounts of the crude as they do under the long-term off-take agreements that are typical for Middle East oil sales. "Some refiners have taken the sample," the second source said, adding West Karoun is new production so Iran "needs to wait for the quality to stabilise".

8. Iran president warns of 'problems': Iran's president Rouhani on Tuesday warned the country could face "some problems" ahead of President Donald Trump's decision on whether to pull out of its nuclear deal with world powers. "It is possible that we will face some problems for two or three months, but we will pass through this," Rouhani said.

Rouhani also stressed Iran wants to keep "working with the world and constructive engagement with the world."

9. Won't let Iran acquire nuclear weapons: Accusing Iran of fuelling bloodshed in the Middle East, President Donald Trump said the US would not let "murderous regime" in Tehran acquire nuclear weapons. "We must ensure that this murderous regime does not even get close to a nuclear weapon, and that Iran ends its proliferation of dangerous missiles, and its support for terrorism. No matter where you go in the Middle East, wherever there's a problem, Iran is right there," he said.

10. What is the Iran nuclear deal? - The Iran deal, also known as Joint Comprehensive Plan of Action (JCPOA), is an international agreement reached on July 14, 2015 between Iran and six world countries - China, France, Russia, Britain, the US and Germany, plus the EU.

Iran, in a pact with the world powers, had agreed to halt its nuclear programme in return for an easing of economic sanctions on Tehran.

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