President Donald Trump, citing "glaring flaws" in the 2015 Iran nuclear deal, withdrew the United States from the agreement on Tuesday, in effect reinstating economic sanctions on Iran and on companies that do business with it.
"The deal lifted crippling economic sanctions on Iran in exchange for very weak limits on the regime's nuclear activity, and no limits at all on its other malign behaviour, including its sinister activities in Syria, Yemen and other places all around the world," said Mr Trump.
"In the years since the deal was reached, Iran's military budget has grown by almost 40 per cent," he noted. "At the heart of the Iran deal was a giant fiction that a murderous regime desired only a peaceful nuclear energy programme."
The move came as no surprise, given Mr Trump's long-maintained dislike of the deal. And the fact that Iran is in compliance with the deal held little relevance, as National Security Adviser John Bolton made clear to journalists.
"This deal was fundamentally flawed," he said. "It... allows them, even if they're in compliance... to increase their research and development on the sophistication of their nuclear capabilities."
Iranian President Hassan Rouhani will be weakened by the US' pullout, analysts say, to the advantage of hardliners. Yet, Iranian public opinion may well coalesce around the powerful clergy led by Supreme Leader Ali Khamenei and the government.
"A lot of Iranians, clerical or not clerical, are united on one issue: they believe Iranians have a right to have a nuclear programme," a senior diplomat in Washington who is familiar with Iran told The Straits Times.
We cannot prevent an Iranian nuclear bomb under the decaying and rotten structure of the current agreement. The Iran deal is defective at its core.
US PRESIDENT DONALD TRUMP
PSYCHOLOGICAL WAR AGAINST IRAN
This decision was an act of psychological warfare against Iran. I have instructed the Iranian Atomic Energy Organisation to take the necessary measures for future actions so that, if necessary, we can resume industrial enrichment without limit.
IRANIAN PRESIDENT HASSAN ROUHANI
A REGRETTABLE DECISION
France, Germany and the UK regret the US decision to leave the JCPOA. The nuclear non-proliferation regime is at stake. We will work collectively on a broader framework, covering nuclear activity, the post-2025 period, ballistic activity and stability in the Middle East, notably Syria, Yemen and Iraq.
FRENCH PRESIDENT EMMANUEL MACRON, on Twitter, referring to the Iran deal by its formal name, the Joint Comprehensive Plan of Action.
CHINA TO STAY IMPARTIAL
China will continue to uphold an impartial, objective and responsible attitude, remain in dialogue with all parties and continue to devote itself to safeguard and implement the deal.
CHINA'S FOREIGN MINISTRY SPOKESMAN GENG SHUANG
"They may be amenable to a discussion on how to manage it, but not to give it up. They believe it is their natural right; they say if Israel has it, why can't we have it?"
Mr Rouhani has said Teheran considers the deal still valid with its other signatories - China, France, Germany, Russia, Britain and the European Union. But reimposed economic sanctions will also affect US allies in Europe and elsewhere who do business with Iran.
"The big question mark is what the US government might do to non-US companies that continue to work with Iran and, by doing so, open themselves up to US secondary sanctions," Ms Janet Kim, a partner at Washington-based international law firm Baker McKenzie, said.
A senior State Department official told journalists on Tuesday: "We do think that... companies should not do business in Iran. That's an intended consequence."
There is a "wind down" period of 90 to 180 days to allow companies to unravel business deals, according to the official. "We're providing a six-month wind down for energy-related sanctions," he said. "That's oil, petroleum, petrochemicals... and ancillaries."
France, Britain and Germany are among those saddled with a balancing act as they weigh their ties with the US with their business ties with Iran, which is a major oil exporter. India will also be affected; Iran was India's third largest source of oil last year, and India has commercial and strategic interests in Iran's Chabahar port.
In an e-mail bulletin, the consultancy Soufan Group wrote: "European and other reactions to the US withdrawal suggest that global cooperation with reimposed sanctions on Iran will be limited, if not absent."
In Washington, hawks are celebrating Mr Trump's move. But while many analysts agree the Iran deal was badly constructed, they say it has worked thus far, and the US pullout will further destabilise the Middle East, where Iran and Israel are already in a proxy war in Syria, and Saudi Arabia and Iran are in a proxy war in Yemen.
The pullout also sends a wider message about American foreign policy under Mr Trump, who articulated it on Tuesday: "Today's action sends a critical message: The United States no longer makes empty threats. When I make promises, I keep them."
"This is US hard power," said international politics professor Inderjeet Parmar of the City, University of London.
"The US has been losing global positions and influence to regional rivals, and it is now using its economic and military muscle to try to reverse trends," he said.
At home, Mr Trump's core supporters, including largely pro-Israel evangelical and Jewish voters, would be happy, said Cornell University's professor of American studies Glenn Altschuler.
"The principle message to the President's domestic audience is that unlike his predecessors, he is tough and puts America first... and if it's a bad deal, then he will not make it just because some people say any deal is better than no deal."
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