The US-Iran agreement, albeit temporary, may well be the diplomatic coup of the decade, or indeed the biggest peaceful shifting of the tectonic plates since the last World War in the most dangerous area on the planet. But it is as well, for future reference, to identify the specific mechanisms which allowed this breakthrough to proceed.
First, it came about because sanctions were applied to Iran which seriously threatened the political and economic stability of the country. These pressures had caused Iran’s currency to halve in value against the US dollar in the last 2 years, its foreign exchange holdings in excess of $50bn to be frozen, and crucially its oil revenues to be cut by more than half. Restrictions had been placed on Iran’s trade in gold, petrochemicals, car and plane parts which cumulatively took their toll. Continue reading