A man walks past Azadi Tower (Liberty Tower) in Azadi Square in Tehran, Iran, January 17, 2016..
(photo credit: RAHEB HOMAVANDI/TIMA VIA REUTERS)
VIENNA - Major powers and Iran agreed on Friday to move quickly to offset the U.S. pullout from its nuclear deal and Washington's renewed sanctions, with Tehran pressuring Europe to come up with a package of economic measures by May 31.
The 2015 agreement between Iran and world powers lifted international sanctions on Tehran. In return, Iran agreed to restrictions on its nuclear activities, increasing the time it would need to produce an atom bomb if it chose to do so.
Since President Donald Trump withdrew the United States this month, calling the agreement deeply flawed, European states have been scrambling to ensure Iran gets enough economic benefits to persuade it to stay in the deal.
But this has proven difficult, with many European firms alarmed at the specter of far-reaching U.S. financial penalties.
Nations that remain in the deal - Britain, China, France, Germany and Russia - held a formal meeting on Friday without the United States for the first time since Trump's announcement, but diplomats saw limited scope for salvaging the agreement.
"For the time being we are negotiating... to see if they can provide us with a package which can actually give Iran the benefits of sanctions-lifting and then the next step is to find guarantees for that package," Iran's Deputy Foreign Minister Abbas Araqchi told reporters after the meeting.
The talks between senior officials aimed at fleshing out the package of measures to keep oil and investments flowing.
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Those measures include banning EU-based firms from complying with the reimposed U.S. sanctions, urging governments to make transfers to Iran's central bank to avoid fines and creating alternative financing channels.
"We expect the (economic) package to be given to us by the end of May," a senior Iranian official said earlier, adding that Tehran was "weeks" away from deciding whether to quit the pact.
European measures would need to ensure that oil exports did not halt, and that Iran would still have access to the SWIFT international bank payments messaging system, he said.
A senior EU official said the participants had stressed on Friday that the package would not be immediate.
"We made it very clear today that there are things that will take more time," the official said.
Foreign ministers of the remaining countries will meet in the coming weeks.
Washington has not only reimposed sanctions but started to make them even tighter. U.S. Secretary of State Mike Pompeo threatened Iran on Monday with "the strongest sanctions in history" if it did not change its behavior in the Middle East.
"Pompeo was like taking a cold shower," said a European diplomat. "We'll try to cling to the deal, but... we're under no illusions."
Iranian Supreme Leader Ayatollah Ali Khamenei set out conditions on Wednesday for Iran to stay in the deal: unless Europe guarantees Iran's oil sales will not suffer, Tehran would resume enrichment activities that are currently prohibited. The deal lets Iran enrich but under tight restrictions.
"We were very clear we can’t give guarantees but we can create the necessary conditions for the Iranians to keep benefiting from the sanctions-lifting under the JCPOA (the nuclear deal) and to protect our interests and continue to develop legitimate business with Iran," the EU official said.
Iran has so far benefited less from the accord than it had initially hoped, partly because of remaining U.S. sanctions that have deterred major Western investors from doing business with Tehran. Some Western companies have already quit Iran or said they may have to leave because of the new U.S. sanctions.
Trump denounced the accord, completed under his predecessor Barack Obama, because it did not cover Iran's ballistic missile program or its role in Middle East wars, or address the issue of what happens after the deal begins to expire in 2025.
Khamenei rejected any new negotiations over Iran's ballistic missile program or its regional activities.
European nations share some U.S. concerns but say that torpedoing the nuclear deal makes it far harder to address them. They have said that as long as Tehran meets its commitments, they will stick to the deal.
The U.N. nuclear watchdog, which polices the pact, says Iran continues to comply with its terms.. (Additional reporting by Parisa Hafezi in Ankara, editing by Mark Heinrich and Gareth Jones)
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