The US and Iran face off at the UN

At last year's UN General Assembly, President Donald Trump called Iran a “murderous” and “corrupt dictatorship.” President Hassan Rouhani responded by describing Trump's comments as “ignorant, absurd and hateful.” This year's General Assembly is unlikely to go much better. Eurasia Group Iran expert Henry Rome discusses what to expect as world leaders gather this week in New York and the geopolitical fallout.
 
Will Trump and Rouhani meet on the UN sidelines?
 
Probably not. Trump has repeatedly dangled the possibility of meeting Rouhani, even suggesting that he would sit down “anytime” with “no preconditions.” But the Iranians are simply not interested. Supreme Leader Ali Khamenei, who has the final say on the issue, said in August that any meetings between Iranian and US officials “at any level” are prohibited at this time. No US president has ever met his Iranian counterpart—not even former president Barack Obama got more than a phone call. It is very difficult to imagine Khamenei making an exception for Trump. That's not to say a meeting is impossible in the future, especially if sanctions pressure intensifies. But it's very unlikely before 2019.
 
From Tehran's perspective, what is the best outcome of this week's UN General Assembly meetings? The absolute worst?
 
Rouhani and Foreign Minister Javad Zarif are seeking public, concrete assurances from their European counterparts that Iran will continue to benefit from the nuclear agreement. But few arrangements are finalized at this point, so probably the best Rouhani and Zarif can hope for is a public show of solidarity with other world leaders. This would come in bilateral meetings or at the UN Security Council meeting that Trump is scheduled to host on Wednesday. Tehran's worst nightmare would be the opposite: if Britain, France, and Germany, ostensibly its partners, decide to get in line with Trump by strongly criticizing Iran's behavior.
 
How isolated is Iran at the moment? How desperate is its economic situation?
 
This week's events will showcase two contradictory trends. On the one hand, Iran is far from isolated politically. Washington's withdrawal from the nuclear deal has only increased sympathy for Iran among its friends in the Non-Aligned Movement, and European states are working intently to preserve strong ties with Tehran. On the other hand, despite this political goodwill, Iran will face severe economic isolation when additional US sanctions snap back in November. The sanctions will likely depress Iranian crude exports to around 1.2 million barrels per day, a major blow. Already, the prospect of sanctions has put immense strain on the Iranian economy. The rial has lost 70% of its value against the dollar in 2018, and inflation has risen. The economy is not on the verge of collapse, but the government will likely face more frequent public protests.
 
Now that the US has withdrawn, is the nuclear deal dead?
 
Not quite. Since the US withdrew in May, Iran and the remaining signatories (UK, France, Germany, China, and Russia) have worked to keep the deal going. Iran has continued to respect the limits on its nuclear activity—as it has since the deal came into force. But the return of US sanctions will put the regime under immense pressure to withdraw. In last year's speech, Rouhani stated that Iran “will respond decisively and resolutely to [the deal's] violation by any party.” So far, it hasn't done so. Instead, Iran is waiting for the other signatories to keep up their end of the bargain: ensuring Iran sees economic benefit. Since Iran's oil exports and international financial links will dry up significantly, Tehran will likely decide to leave the agreement shortly after the sanctions return.