(Washington, D.C.) - The Middle East Institute (MEI) hosted Kenneth Katzman (Congressional Research Service), Laura Rozen (Al-Monitor), Sara Vakhshouri (SVB Energy International), and Alex Vatanka (MEI) for a discussion about the impact of sanctions relief on Iran's economic and political future. Indira Lakshmanan moderated the event.
The panelists discussed Iran’s re-entry into the international oil trade, the Iran Petroleum Contract (IPC), the domestic political impact of sanctions removal, the upcoming parliamentary elections, and Iranian President Hassan Rouhani’s legacy and future challenges given Iran’s re-emergence on the international stage.
MEI Senior Fellow Alex Vatanka framed the discussion in a political history of President Rouhani’s impact on American-Iranian relations. He examined U.S.-Iranian negotiations prior to the lifting of sanctions, during which Rouhani successfully broke the “American taboo” in Iranian policy-making. Vatanka noted, however, the criticisms and attacks Rouhani faces from conservative hardliners regarding corruption and Western infiltration into the economy. He argued that Rouhani must confront these attacks in order to win a second term as president. Additionally, he addressed how the upcoming elections for the Iranian Parliament and the Assembly of Experts will impact Rouhani’s economic agenda. He explained Parliament’s significant influence over the budget and the IPC, making that body a critical factor in the implementation of Rouhani’s economic plans. Finally, he discussed the role Iran’s Supreme Leader, Ali Khamenei, plays in the economic and political future of Iran.
Kenneth Katzman examined the differences between the Iranian economy before, under, and after removal of sanctions, the possibility of sanctions snapback, and the economic and legal risks faced by countries engaging in business relations with Iran. He discussed the necessity of diversifying Iranian exports as the country shifts away from being primarily an oil producing, trading, and light manufacturing economy. He also highlighted the limitations and restrictions American companies will continue to face in engaging in trade with Iran, stating that only when other outstanding issues with Iran are solved will U.S. business dynamics with that country drastically change.
Laura Rozen described diplomatic relations between the U.S. and Iran, between the U.S. and Saudi Arabia, and the significance of the relationship between the Obama Administration and President Rouhani. She discussed whether the improved channels established over the course of the nuclear negotiations and anti-ISIS coordination led by John Kerry and Javad Zarif would continue beyond the current administration. Rozen argued that efforts do exist on both sides to institutionalize these channels, but the continuation of improved U.S.-Iranian relations depends heavily on the future “personalities and ideologies of the administrations.” She also mentioned Iran’s relations with other major international actors, noting that the urgency of the Syrian refugee crisis has made European countries “lean in more” to Iran.
Sara Vakhshouri focused on the possible challenges and opportunities Iran faces in re-entering the international oil market. She argued that the confluence of low oil prices and oversupplied energy markets make this a particularly difficult time for Iran to re-enter the global oil trade. Vakhshouri explained that Iran must first secure customers for its oil, many of whom were absorbed by Saudi Arabia and other Gulf countries during the sanction era, before it can begin to increase production. She also discussed the intricacies and variables of the Iran Petroleum Contract (IPC), including the Iranian constitutional claim to public ownership of oil reserves, corporate booking of reserves, and reform measures to float fees per barrel.
The panel concluded with a question and answer session, which covered the effects of the Syrian crisis on Iran’s foreign relations, the outlook for gas prices in Iran, and the impact and reach of the Iranian Revolutionary Guard Corps (IRGC) in Iranian government and business.
Summary by Brittany Thompson.
Speaker Biographies:
Kenneth Katzman
Specialist in Middle Eastern Affairs, Congressional Research Service
Kenneth Katzman has served in both government and the private sector as an analyst in Persian Gulf affairs, with special emphasis on Iran and Iraq. In his current position, Katzman analyzes U.S. policy and legislation on the Persian Gulf region for members of Congress and their staffs. He also has written numerous articles in various outside publications, including a book entitled The Warriors of Islam: Iran's Revolutionary Guard (Westview Pr, 1993). During 1996, Katzman was assigned to the House International Relations Committee. He has appeared on CNN, NBC Nightly News, Nightline, and The News Hour with Jim Lehrer and holds a Ph.D. in political science from New York University.
Laura Rozen
Foreign Policy Reporter, Al-Monitor
Laura Rozen writes the Back Channel news-blog for Al-Monitor. She previously served as senior foreign policy reporter for Politico and Yahoo News, and wrote the “Cable” blog for Foreign Policy magazine. Rozen has reported from the Balkans, Russia, and Turkey and earned a masters degree in public administration from the Harvard Kennedy School. Her reporting has been published by the Boston Globe, the Los Angeles Times, Washington Post, Christian Science Monitor, the Forward, the Tablet, National Journal, Mother Jones, the American Prospect and the Washington Monthly. She has appeared as a guest on CNN, NPR, the BBC, MSNBC and other public affairs programs. She is also a columnist for World Politics Review.
Sara Vakshouri
Founder and President, SVB Energy International and Non-Resident Senior Energy Fellow, Atlantic Council
Sara Vakhshouri has extensive experience in global energy market studies, energy security, and geopolitical risk, and consults numerous energy and policy leaders. She has experience working in both public and private sectors of the Iranian energy industry from 2000 to 2008. Based in Washington, D.C. since 2009, she has advised international corporations, think tanks, investment banks, and law firms on global energy markets, geopolitics of energy, and investment patterns. Vakshouri has published articles in numerous journals including The Economist, Middle East Economic Survey, and Oil and Gas Journal. She is frequently quoted and has appeared on Bloomberg, BBC, The Financial Times, Reuters, The Financial Post, Aljazeera, and Voice of America. She is the author of The Marketing and Sale of Iranian Export Crude Oil since the Islamic Revolution (The American Society of Business and Behavioral Sciences, 2011). Vakhshouri has a Ph.D. in energy security and Middle Eastern studies, and was a visiting fellow at Oxford Institute for Energy Studies.
Alex Vatanka
Senior Fellow, Middle East Institute
Alex Vatanka is a senior fellow at the Middle East Institute who specializes in Middle Eastern affairs with a particular focus on Iran. From 2006-2010, he was the managing editor of Jane’s Islamic Affairs Analyst, based in Washington. From 2001-2006, he was a senior political analyst at Jane’s in London, where he mainly covered political developments in the Middle East. He joined the Middle East Institute in 2007. His forthcoming book is Iran and Pakistan: Security, Diplomacy and American Influence.
Indira Lakshmanan (Moderator)
Foreign Policy Correspondent
Indira Lakshmanan has reported from 80 countries in Asia, Latin America, Europe and the Middle East over seven years as a State Department correspondent for Bloomberg News and more than a decade abroad for The Boston Globe. She traveled regularly with Secretaries of State Hillary Clinton and John Kerry, and covered the 2008 U.S. presidential campaign, traveling with Clinton, Barack Obama, John McCain and Mitt Romney. For two years, she wrote a page two column for the International Herald Tribune, the overseas edition of The New York Times, and Bloomberg. Lakshmanan has been a guest host for NPR’s “Weekend Edition” and “The Diane Rehm Show,” as well as a guest commentator on PBS’s “Washington Week” and “NewsHour,” and on NPR, Sirius XM and MSNBC. She chronicled the inside story of seven years of Obama Administration diplomacy with Iran for Politico Magazine. Indira was posted overseas for 12 years, as The Boston Globe's Asia bureau chief in Hong Kong and Shanghai, its Latin America bureau chief in Bogota, Colombia, and a Bosnia War correspondent.