If the arrangement comes to fruition, it would constitute the most open break between US President Trump and European allies that objected vociferously to his decision to pull out of the 2015 nuclear deal.
Several of those countries openly confronted Trump on Wednesday, when he led a United Nations Security Council meeting. They argued that he was throwing away the best chance the world has.
In an hour-long conversation with reporters at the Iranian mission to the United Nations in New York on Saturday evening, Zarif, who negotiated the nuclear accord, sounded far more optimistic than he had in recent months that he could peel away America’s traditional allies to break Trump’s effort to cut off Iran’s revenues.
Zarif is capitalizing on a renewed enthusiasm among some of the allies to push back at what they term bullying by Washington to sever ties with Iran simply because Trump decided to forsake the nuclear pact. All the other signatories to the agreement — Britain, China, France, Germany, Iran and Russia — have vowed to stand by it.
The attempts to evade US sanctions are rooted in the belief that the nuclear deal is working as intended, and that Iran has kept its commitments to the agreement under monitoring by the International Atomic Energy Agency. In effect, Iran and the other countries involved in the agreement are trying to keep the deal alive.
Only a handful of countries agree with the US decision to abandon the nuclear deal. The European Union said Monday that its member countries would establish a system to allow oil companies and private businesses to keep trading with Iran.
“No sovereign country or organization can accept that somebody else decides with whom you are allowed to do trade with,” Federica Mogherini, the European Union foreign policy chief, said this past week. She predicted that the financial arrangements could be in place before Trump issues the next set of sanctions in November, aimed at banks, businesses and countries that conduct business with Iran.
Trump announced in May that he was withdrawing from the deal, US officials have pressured countries around the world to stop their oil sales from Iran to prevent it from its chief source of income. They also threatened secondary sanctions if the sanctions are defied.
At the core of the agreement that Iran and Europe are trying to forge is a mechanism for paying for Iran’s oil in barter and local currencies, rather than in American dollars. The idea is to route around the United States and prevent it from blocking financial transfers — and perhaps from identifying those involved in the transactions.
“The actual mechanism would be to avoid dollars,” Zarif said, adding that countries are starting to make agreements to use their own currencies in bilateral trade.
“You can use your own currency,” he explained. “Sell stuff in your own currency, buy stuff in the other country’s currency, and at the end of a specific period, balance it out in a non-dollar currency. It’s quite possible and may even be profitable.”
“This is for us to sell our oil and get the proceeds,” Zarif said, noting that under the United Nations resolutions passed once the 2015 agreement was reached, countries have the legal right to trade with Iran.
Iran might leave JCPOA
Zarif said Iran might pull out of the deal, officially called the JCPOA if the special mechanism being created by the Europeans doesn’t work. Asked if that would open the door to a US military attack, he said, “I think if the United States believed it could succeed in such an attack, it would have done so.”
The uncertainty over the looming US sanctions has sent oil prices to a four-year high. The sanctions against Iran, which is the third largest producer in the Organization of the Petroleum Exporting Countries, become effective November 4.
US officials have excoriated Iran for getting involved in regional conflicts in Syria, Iraq, Lebanon and Yemen. But Zarif portrayed the United States as the aggressor in the region.
“Have you seen that map with all the US bases around us and said, ‘Why are these Iranians putting their country in the middle of all these bases?” he said sarcastically. “We are in our region. We have not invaded any country. We have not sent troops anywhere we were not asked. We have not bombed any country. We have not taken territory from any country. We are content with our size, with our geography, with our resources. We have no eye on anybody else’s territory, resources or people.”
Trump and US Secretary of State Mike Pompeo have denounced former secretary of state John Kerry for holding talks with Zarif. Kerry and Zarif formed a professional friendship during long months of negotiating the deal.
“I didn’t know that you still had witch hunts here in the US,” Zarif said when asked to characterize the conversations with Kerry.
“What he has done has been to encourage us to stay in the deal,” he added, lauding the virtues of dialogue between Americans and Iranians.
The New York Times and The Washington Post contributed to this story.