The New Geopolitics of Energy
On September 14, drones and cruise missiles struck Saudi Arabia’s most important oil-processing facility, at Abqaiq. The attacks don’t just threaten the global oil supply, of which Abqaiq accounts for roughly five percent. They pose a critical test for the administration of U.S. President Donald Trump.
Iran has chosen to act very brazenly with these strikes. If there is no consequence for that choice, the Islamic Republic will be even more emboldened. Worse, an ineffectual response will send a message internationally that there are no rules, no limits, and anything goes.
The day of the strikes, U.S. Secretary of State Mike Pompeo lost no time in attributing them to the Iranians. The Saudi Ministry of Defense has displayed remnants of the drones and cruise missiles used—all Iranian made—and the ministry’s spokesman, Colonel Turki al-Malki, said the attack was “unquestionably sponsored by Iran.”
That choice of words left vague whether the Iranians had conducted the attack themselves from Iranian territory. But U.S. officials have said in background statements that the cruise missiles were launched from Iranian bases. Pompeo declared the strikes an “act of war”—certainly implying that the United States must do something about them.
So far, the president has responded with his instrument of choice: sanctions. His administration has called its approach to Iran to date “maximum pressure,” though it might more accurately be called “maximum economic pressure.” Now Washington needs to ask itself whether this approach matches the current test.
If the Iranians attacked Saudi Arabia’s most important oil facility directly, from their own territory, they have crossed a threshold. They have also acted in a manner completely out of character. The Islamic Republic typically works in the region through proxies, allowing for plausible deniability. Iranian President Hassan Rouhani and Foreign Minister Mohammad Javad Zarif have denied that Iran was behind the recent strikes. But the attackers clearly used Iranian weapons, including short-range drones that could not have reached Abqaiq if fired from Yemen—making Houthi claims of responsibility an obvious deception and cover for Iran.
The Iranians have some motivation for such out-of-character behavior. To begin with, they think they can get away with it. They have lost their fear of the United States and believe it won’t respond. Add to that the fact that they are being terribly squeezed by the Trump administration’s maximum economic pressure policy, which they believe gives them reason to push back.
The Iranians have observed the Trump administration closely. On May 5, John Bolton, then the U.S. national security adviser, announced that the United States was sending a carrier strike group to the Gulf because it had intelligence that the Iranians were planning attacks on U.S. forces in the region. Bolton declared that Washington would respond with “unrelenting force” to attacks on U.S. forces, interests, or friends in the Middle East. In the days and then weeks that followed, limpet mines blew holes in the hulls of four oil tankers; Houthi drones attacked Saudi civilian airfields and oil-pumping stations; mines exploded more tankers in the Gulf of Oman; Shiite militias fired rockets about 300 meters from the American embassy in Baghdad, as well as at American bases north of Baghdad; and the Iranian military shot down a U.S. drone. Only for the last of these did Iran take credit.
The United States did not use “unrelenting force”—or any force—in response to the string of attacks. On the contrary, the administration appeared to retreat from long-standing U.S. commitments. Back in January 1980, President Jimmy Carter had declared the Persian Gulf a vital national security interest of the United States. Trump abandoned that stance in late June of this year, when he tweeted that the United States does not get its oil from the Gulf region and that those who do should assume the principal responsibility for keeping the Strait of Hormuz open. According to the president, preserving the free flow of oil, at least from the Middle East, is no longer a vital American interest or security responsibility. Moreover, the president called off the planned military retaliation for the downing of the U.S. drone. The Iranians concluded that as long as they didn’t kill American servicemen and servicewomen in a direct, overt strike, the United States would not respond. Everything below that threshold was fair game.
The Iranians concluded that as long as they didn’t kill American servicemen and servicewomen in a direct, overt strike, the United States would not respond.
The foregoing explains why the Iranians have not been deterred from attacking U.S. allies and interests. But it does not account for Tehran’s motivation in intensifying that campaign in the first place. The economic pressure policy is relevant here. On May 4, the Trump administration ended the waivers that permitted several countries to buy Iranian oil despite U.S. sanctions. The express purpose was to drive Iranian oil sales to zero. The Iranian leadership decided then to meet Trump’s maximum pressure with its version of maximum pressure on U.S. allies and interests in the Middle East. Until that time, Iran’s “malign activities” were part of the landscape, but they were not escalating. After the end of the waivers, the Iranians began not only to attack the oil supply—by way of the tankers and smaller Saudi oil facilities and pumping stations—but also to gradually walk away from their end of the Iran nuclear deal.
That the Iranians would respond to the Trump administration’s maximum economic pressure campaign should not have come as a surprise. After all, Iran has long maintained that if it could not export oil, no one else in the region would be able to either. Moreover, Tehran has made clear at the highest levels that it views the U.S. sanctions policy as one of economic warfare against the Islamic Republic. Supreme Leader Ali Khamenei said in a speech on September 17 that the Islamic Republic should therefore “create deterrence . . . so that the enemy realizes he cannot pressure the nation through the economic sector.”
By “creating deterrence,” Khamenei means to raise the price for the United States such that it will back off of its economic pressure campaign. The posture is not a new one for Iran’s supreme leader. Back in May, he noted that the United States was trying to weaken Iran so that it would come back to the negotiating table and concede. Khamenei said that the Islamic Republic would do no such thing—rather, it would apply its own “leverage.”
That Iran would meet Washington’s maximum pressure with a maximum pressure campaign of its own, designed to get the United States to back off, should have come as no surprise. But the Trump administration is clearly surprised, having assumed that the Iranians could be squeezed into coming back to the table and submitting. Washington neither anticipated nor planned for Iranian retaliation in the region. It did not prepare for the kinds of attacks the Iranians have been behind or are now carrying out. Ironically, an administration that often speaks of Iranian “malign activities” failed to anticipate that Iran could ratchet them up in response to the real economic squeeze it imposed on the Islamic Republic.
The problem is that the Trump administration has lacked a strategy toward Iran. It has principally been prepared to use a single instrument: economic pressure. But economic pressure is a means, not an end. If the objective is, as Trump says, not regime change but a change in the regime’s behavior, then the administration needs to employ all the tools of statecraft—diplomatic, political, economic, cyber, military, intelligence, and public messaging. Iran must be politically isolated, put on the defensive internationally, subject not just to U.S. pressure but to collective pressures. It must be named and shamed and exposed for its behaviors.
Washington has to show conclusively that many of the drones and cruise missiles were launched from Iranian bases. Given the Trump administration’s lack of credibility, it will need others to join with it in presenting the facts about the source of the attacks. If the United States has the proof; and the French send their analysts to investigate; and the United Nations takes up the Saudi invitation to investigate—then the information can be collectively released, exposing the Iranians and revealing that their denials are lies. At a minimum, the revelations will put the Iranians on the defensive and raise the pressure on the Europeans to respond.
If Iran has in fact directly conducted these attacks, it has undermined regional and international stability in a manner that Washington should highlight to the public both at home and abroad. At issue is not just the defense of Saudi Arabia but the establishment of international rules such that open aggression and attacks on critical infrastructure cannot be carried out with impunity.
The United States has an opportunity this week at the UN General Assembly to explain the dangers and mobilize a broad coalition, starting with the Europeans. If instead the United States fails to respond or issues empty warnings, the Iranians will be further emboldened. Sooner or later, Tehran will miscalculate and set off a wider war. Pompeo should make clear that to think that Trump will continue to show military restraint is a mistake. And the United States, taking advantage of the moment, should work to secure a commitment from the Europeans to join U.S. sanctions unless Iran acts immediately to defuse tensions.
Sooner or later, Tehran will miscalculate and set off a wider war.
China and Russia should be enlisted to convey similar messages to the Iranians. Beijing depends on oil from the region, and the last thing it wants is a major conflict or for more oil facilities to be attacked. The United States should persuade China to adhere to U.S. sanctions if Iran doesn’t stop the aggression and to tell Iran that the investments it receives under China’s Belt and Road Initiative are at risk. Russia doesn’t have the economic leverage with Iran that China has, but the Islamic Republic takes Moscow’s threats and warnings seriously. If President Vladimir Putin sees the Trump administration acting seriously—diplomatically and potentially militarily—he will likely to offer to mediate between Trump and the Iranians, in an effort to show that he can help shape events, and knowing that he has more sway with the Iranians than the French do and that Trump is responsive to him as well.
The Trump administration should also consider supplementing its diplomatic efforts by taking a page from the Iranian playbook. The United States can engage in deniable acts that nonetheless disable or destroy certain high-value Iranian targets. If deemed necessary, such actions would produce what appear to be accidents—but the supreme leader would get the message. He would understand that the adventures of the Islamic Revolutionary Guard Corps are becoming too risky and that the United States will not give in to Iranian pressure.
On the contrary, the Trump administration needs to turn that pressure around by isolating Tehran internationally, exposing its recent acts, and showing that U.S. restraint has limits. The trick will be to keep tightening that vise even while offering Iran a way out, lest the Iranians see us as more in need of a deal than they are.
Khamenei has said that Iran will talk only if the United States returns to the nuclear deal; Rouhani has stipulated that Washington drop sanctions. Both conditions indicate the purpose of Tehran’s maximum pressure campaign. The United States and Iran are unlikely to negotiate directly in the near term, but mediation remains possible and could focus on both the nuclear deal and defusing regional dangers.
For such a mediation to succeed, the Trump administration will have to clarify its aims. Washington must determine under what conditions it would consider returning to the nuclear agreement—for example, if the so-called sunset provisions, which set the timeline for Iran’s compliance, were extended for another 15 years. The president should lay out the changes to Iran’s regional behavior that he would accept: say, for Iran to stop providing Lebanese Hezbollah with advanced rockets and precision-guided munitions; for Tehran to pressure the Houthis to settle in Yemen; and for Iran to cease putting its rockets in areas of Iraq under Shiite militia control. Trump will need to make clear what he is prepared to offer in return for such actions. For example, he may offer to lift the nuclear-related sanctions. Given that many non-nuclear sanctions are enshrined in legislation, he could also offer to set up a special-purpose vehicle that would allow U.S. companies to transact with the Iranians within certain bounds.
Iran is testing the United States and the international community now. The Trump administration needs to show that it knows how to answer.