Iran is moving quickly to comply with all aspects of the nuclear deal reached with the P5+1 nations earlier this year, and that includes shipping its nuclear fuel stockpile abroad.
The Wall Street Journal reported on December 8 that Iran is looking to ship its nuclear fuel to Kazakhstan, a country that has a history of storing nuclear fuel.
Kazakhstan is closely watched by IAEA inspectors and also has a positive relationship with Iran, the United States, and Russia. As such, all parties feel that its nuclear fuel stockpile is under close oversight, so diverting any nuclear material would be difficult. The emerging deal, which is not yet finalized, could see Iran sending enriched uranium to Kazakhstan. Most of Iran’s nuclear fuel is low-enriched uranium (less than 5 percent purity), but some of its more highly enriched uranium (upwards of 20 percent purity) is of concern. Although weapons grade uranium needs to be enriched to 90 percent purity, moving from 20 percent to 90 percent is vastly easier than producing weapons grade uranium from just 5 percent purity. Related: Venezuelan Government Losing Grip As Low Oil Prices Take Their Toll
Iran could reach a commercial agreement that would entail Kazakhstan storing dozens of kilograms of Iran’s 20 percent uranium, possibly for years.
But there are still some moving parts with Iran’s relationship with the international community. On the one hand, the P5+1 nations moved on December 7 to propose a resolution to finally close the 10-year investigation into Iran’s nuclear weapons program after the IAEA found no credible evidence that Iran had pursued its nuclear program after 2009. American officials say the resolution will pass within the next few days. The intention is to remove sanctions ahead of Iranian parliamentary elections in February, which would bolster the Iranian President Hassan Rouhani, seen as a moderate in Iran by the West. Related: The Pain Game – How Low Can Oil Prices Go?
At the same time, Iran reportedly conducted a second ballistic missile test in November in violation of a UN resolution. That has fueled skepticism of Iran’s intentions with Republican members of the U.S. Congress, and has raised the possibility of fresh sanctions on the Iranian regime. The Supreme Leader of Iran, Ayatollah Ali Khamenei, has said that any new sanctions would violate the July nuclear deal.
For the purposes of oil markets, things are still moving forward quickly. Iran is nearing the long-anticipated point at which it can bring back significant volumes of oil exports.
By Charles Kennedy of Oilprice.com
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