The announcement by the IAEA that Iran has fulfilled its obligations according to the Joint Comprehensive Plan of Action (JCPOA) has triggered “Implementation Day” and the removal of the nuclear-related sanctions on Iran. The JCPOA, however, did not deal with Iran’s ballistic missile program, and the sanctions related to it are still nominally in force. These sanctions are minor and will not have any real effect on the Iranian missile program. The missile program will mature during this period and will include Ghadr missiles with ranges of 1,650-1,950 km, which may be capable of carrying nuclear warheads.

The question now is: whither the Iranian nuclear program? After the lifting of sanctions, and taking into account the impracticality of “snap-back” of sanctions, we assess that Iran will now initiate a parallel nuclear program. This will, of course, be far slower than the program that was dismantled by the JCPOA, but it will be realized long before the 10-year target of the JCPOA. One possibility for Iran to continue its nuclear program is through North Korea. The wording of the JCPOA is ambiguous on nuclear Iranian nuclear cooperation with other countries that are not a party to the agreement. North Korea could produce the whole chain of nuclear weapons and put it at Iran’s disposal in return for Iranian funding. North Korea would certainly profit economically from such collaboration and would not risk further sanctions. Such cooperation would be difficult to detect, and even if detected, may not reach the threshold of a material breach of the JCPOA.

The most immediate reward that Iran will receive is the release of frozen Iranian funds ($100-$150 billion). In addition, Iran may now market oil stored offshore in tankers (about 50 billion barrels) and is preparing to increase its production by 500 thousand bpd (from 2.8 million bpd). It is doubtful that Iran can truly increase its production as planned. Even if it does, the addition of Iranian oil is likely to drive prices down even further, counter-balancing much of the potential profit. Sanctions relief also is not a quick fix for the Iranian economy. While it removes legal impediments for investment and business in Iran, the risks that Western companies will face due to residual non-nuclear sanctions (that may be enhanced and enforced by a future American administration), lack of government protection, corruption, and the weakness of the Iranian market cannot be removed by decree. Therefore, European banks and investors may not hurry to invest in Iran at the levels needed to jump-start the Iranian economy after years of sanctions.

The Iranian regime’s goal is not only to block the path to the reformists or reformist-minded, but also to the extremists on the right to Supreme Leader Ali Khamenei. Such a balance could help the Iranian system maintain its “centrist” orientation and guarantee the continuity in the event of Khamenei’s death and the appointment of a new successor (or a triumvirate of several potential leaders). It will also facilitate the eventual takeover of the regime by the Islamic Revolutionary Guards Corps (IRGC) after the demise of Khamenei. The backing that the Guardian Council received from the Supreme Leader for the results of its vetting process, in the face of Rouhani’s condemnation of the disapproval of almost all reformists, is also indicative of the balance of power in the regime.

The Iranian seizure of two US Navy patrol boats on January 12 and the publication of drone pictures of a US Navy aircraft carrier underlined the sense of immunity that Iran has achieved. These actions should be seen in the context of Iran’s attempt to change the rules of the game in the Persian Gulf, while testing the waters of American tolerance and sending to Saudi Arabia and the Gulf States an indirect message that Iran is ready and willing to risk conflict with the US and that the US is a paper tiger that cannot be relied upon in a confrontation between the Gulf States and Iran. In our assessment, Iran will continue with shows of force such as seizing of naval vessels of Saudi Arabia and the Gulf States, stop and search operations of commercial vessels en route to the Gulf States, naval exercises — including missile tests close to Gulf sea-lanes and to the territorial waters of the Gulf States — in international waterways that implicitly interrupt and threaten shipping in the Gulf, “spooking” of Gulf aircraft and even false flag operations of mining, piracy or attacks by proxies in the Gulf and the Red Sea along the Yemeni coast. We may expect as a result possible frontier skirmishes on the shared littoral borders of Iran and Saudi Arabia, gas fields and disputed islands and in the international waters of the Gulf.

The Iranian seizure of two US Navy patrol boats on January 12 underlined the sense of immunity that Iran has achieved.

Saudi Arabia is drawing up its own map of interests and areas of influence that it is projecting as “no-go zones” for Iran — a Saudi “Monroe Doctrine” for the region. The most critical of these are: Yemen (due to the potential for threatening the Bab al-Mandeb Straits), subversion in the Gulf States (primarily Bahrain), the Strait of Hormuz and the international waters of the Gulf. To this list one must add the obvious: any Iranian-inspired or -planned attack on the Saudi homeland itself — government facilities, oil installations etc. — would be perceived as crossing a red line. While neither Saudi Arabia nor Iran is interested in direct conflict, and both would prefer to continue to work through proxies and in areas outside their respective sovereign territories, the dynamic nature of the situation can easily lend itself to misreading of such red lines and such miscalculation may lead to direct confrontation between them. While all-out direct war between Iran and Saudi Arabia remains a low probability, this assessment should be revisited again in the near future.

In Syria, American positions have undergone a strategic shift that reflects the new balance of power created by the Russian intervention. On the military side, the Russian presence imposes a heavy constraint on the American activities, and U.S. officials caution that the success of the Ramadi operation will not be followed by a concerted effort to roll back the “Islamic State” in the Syrian theater. In regards to a political solution, the US has accepted the Russian-Iranian four-point-plan that envisages Bashar al-Assad remaining in office during a transition period and being allowed to run for President in “internationally supervised elections”. In our assessment, the Syrian opposition and their Arab supporters cannot accept any blueprint that would leave any doubt regarding Bashar al-Assad relinquishing power before any process begins. These developments will only feed the sense of the Sunni Arabs that the United States has turned its back on them and is supporting Iranian-Russian hegemony in the region. On this background, the prospects that the Syrian “peace talks” in Geneva will achieve any progress towards resolution or even mitigation of the civil war are close to nil.

Last month’s visit by Chinese President Xi Jin Ping to Saudi Arabia, Egypt and Iran was the first such visit of a Chinese President in the region since 2002, and the first foreign head of state to visit Iran since the announcement of “Implementation Day” of the JCPOA. The Chinese emphasis in all the visits was on economic cooperation, development and stability, but above all — in an implicit stab at the US and Russia — emphasizing that China does not seek proxies, to fill a power vacuum or hegemony in the region. The leitmotif of the visit was the integration of the Middle Eastern partners (i.e. the Arabs in general and Iran) into China’s “Belt and Road Initiative.” In spite of the inclusion of Iran in the visit, President Xi took care not to offend the Arabs. The agreements with Saudi Arabia included nuclear cooperation in a scope far greater than that which was offered to Iran, and the joint statement reflected the Saudi position on Yemen, stating, “both sides stressed support for the legitimate regime of Yemen.”

The “Arab Policy Paper” published on the eve of the visit stresses China’s commitment to “non-intervention and opposition to interference in the affairs of other countries”. This is seen by the Arab policy communities as a sign of implicit Chinese support for their position vis-à-vis Iran’s activities in the region, though they would have welcomed more explicit statements of support. There is no expectation in the region that China is going to play the “Big Power” card in the region. Taking sides in this conflict would be out of character for China. Saudi Arabia and the other Arab states will attempt to convince China to refrain from demonstrations of rapprochement with Iran and to support the Arab positions vis-à-vis Iranian provocations in the Gulf, Syria and Yemen. While China may show a slight implicit leaning towards the Arab position on these issues, it is not likely to take a clear anti-Iranian/pro-Arab position in the near future.

The European Union-Turkey agreement of 25 November, which provided Turkey with 3 billion euros over two years in order to stop the flow of refugees to Europe, has not achieved that goal. Speaking privately, EU officials complain that Turkey has not taken any concrete measures to reduce the flow of refugees. In our assessment, Turkey will continue to prevaricate on steps to stem the flow of refugees as pressure on the EU to give more concessions. Turkey has already signaled that the sum will not suffice for the task of maintaining the refugees inside Turkey alone, and certainly not for other security measures such as blocking the border with Turkey to prevent passage to and fro of “Islamic State” foreign fighters.

Aside from the 3 billion euros, the EU commitments will also not be easily implemented; visa waivers for Turkish citizens in general will encounter massive opposition within the EU. The road to Turkish accession to the EU must also go through complex negotiations on various aspects of compatibility of Turkey to the standards of the EU. All these discussions will encounter a veto by Cyprus, pending a peace deal with Turkish-occupied Northern Cyprus. This veto may be resolved if a referendum on unification of Cyprus takes place and supports re-unification later this year. However, the real obstacle towards Turkish accession is not technical or due to the Cyprus question; it revolves around the shift in European public opinion towards absorption of immigrants from Muslim countries. During the coming year, there will certainly be further terrorist attacks that will push European public opinion further to the right. Under these circumstances, Turkish accession or even visa waiver will be very unlikely.

In our assessment, the trend towards Kurdish independence will eventually lead to an independent Iraqi Kurdistan. The events in Syrian Kurdistan will also affect the pace and direction of the independence movement in Iraq’s Kurdistan Regional Government (KRG). Unification of the parts of Syrian Kurdistan in the face of Turkish opposition and under Russian protection will give impetus to the demand to create a political fait accompli of independence in Iraqi Kurdistan. As the principle of Kurdish independence in Iraq gains more and more support and becomes a reality, the irredentist demand for unification of Kurdistan — Iraqi and Syrian — will also begin to be heard. This is the fulfillment of the Kurdish nightmare that Turkey has always feared. With the deterioration of relations between the AKP government and the Turkish Kurds inside Turkey, such a political reality of independent Kurdistan will add fire to the flames of the Kurdish rebellion in southern Turkey. It is highly likely that Russia will take advantage of the trend and support the Kurds, effectively turning an American ally into a Russian one. If this happens, the US will have lost an important potential ally in the new map of the Middle East.

The large number of players on the ground that may take a part in the campaign for Mosul will only complicate the campaign further and — if the city or part of it is retaken, will increase the chances of internal fighting between the components of the ad-hoc alliance of Iraqi government forces, Shiite militias, Sunni militias, Kurdish Peshmarga, Turks and American forces.

On this background, the Syrian “Peace Talks” in Geneva started (29 January) as “proximity talks” in which the UN representatives shuttle between the rooms of the opposing parties. The Saudi supported High Negotiations Committee (HNC) of the Syrian opposition ceded their original conditions — cessation of the attacks on civilians — though they refuse to meet with the regime representatives while the latter refuse to meet with “terrorists”. The Syrian regime representation is low-level as an indication that there is no intention to hold real negotiations. Furthermore, the Kurdish Democratic Union Party (PYD), whose military wing, the YPG, is the most effective fighting force on the ground against the “Islamic State,” were not included in the opposition delegation because of the Turkish threat to boycott the Geneva negotiations if it participates. Under these conditions, the prospects that the talks will achieve any progress towards resolution or even mitigation of the civil war are close to nil.

Dr. Shmuel Bar is a senior research fellow at Israel’s Institute for Policy and Strategy at the Interdisciplinary Center Herzliya in Israel and a veteran of Israel’s intelligence community.