<p class="font_8">Iran will hold presidential elections on June 18 and despite considerable efforts by the authorities, the battle at the ballot box is set to be a lifeless affair. A solid majority of Iranian voters have by now entirely lost hope that voting makes any difference. Actual turnout could be as low as 20% as compared to the 73% recorded in 2017. Ayatollah Ali Khamenei, the unelected supreme leader who has ruled over Iran since 1989, is not on the ballot. Nor are the Revolutionary Guards, the armed defenders of the Islamic Republic’s theocratic system. These two institutions wield the real power in Tehran, not the Presidential Palace.</p>

<p class="font_8">The 25-year agreement between Iran and China that made headlines this past month is far from new. It was first announced in 2016 during a state visit by President Xi Jinping to Tehran, at a time when sanctions on Iran were being lifted as part of the 2015 nuclear deal. Chinese and Iranian officials have been working out the details of the deal ever since as part of a slow process of consultation and negotiations.</p>

<p class="font_8">There have been some Iranian advances in building relations with Black Sea states over the last 30 years. However, Tehran’s wavering commitment to deeper ties with its northern neighbors, with the exception of Russia, has considerably reduced the potential footprint Iran could have otherwise had in the Black Sea region. Tehran’s ongoing standoff with the United States, its ideologically driven preoccupation to make advances in the Arab world, and a gradual but clear submission to Russian hegemony has meant that the Black Sea region is a policy matter of secondary importance to decision-makers in Tehran.</p>

<p class="font_8">Given its size, Qatar might seem a curious choice. Other top contenders to mediate are either diplomatic heavy-hitters, such as Japan or France, or have a long track record in this area, like Oman, which has over recent years hosted multiple rounds of backchannel U.S.-Iran talks. But the Qataris have good reasons to want to do this. An outright conflict between Iran and the U.S. will put Qatar on the frontlines. It is, after all, home to the largest American military base in the Middle East. The Qataris have also had clandestine intelligence relations with their Iranian counterparts, unlike very many other countries. That is a facility that can be of value to both Iran and the U.S.&nbsp;</p>

<p class="font_8">Iran was caught off guard by the July 2020 round of conflict between Armenia and Azerbaijan. Tehran was even more alarmed by the proactive role Moscow and Ankara played during and in the aftermath of the six-week war that ended with the Russian-brokered ceasefire on November 10. In fear of being kept on the sidelines, Iran’s Foreign Minister Javad Zarif embarked on a regional tour last month to Azerbaijan, Armenia, Russia, Georgia and Turkey.</p>

<p class="font_8">There is a lot riding on the success of the recent cease-fire agreement between Azerbaijan and Armenia. NATO’s energy security is now intertwined with the fragile deal. Fueled by Russian arms and military training, the Armenia-Azerbaijan conflict threatens to shake confidence in Europe’s drive to reduce its energy reliance on Moscow.</p>
<p class="font_8">It’s no secret that Russia remains determined to weaken&nbsp;the United States and NATO. Not long ago, Moscow weaponized gas exports to Europe to aid an expansionist military campaign against Ukraine. To address these threats, the United States supported the creation of new energy infrastructure routed through Azerbaijan. The intent was to strengthen Western Europe’s energy security.</p>

<p class="font_8">The recent peace deal between Armenia and Azerbaijan that ended weeks of military conflict right on Iran’s doorstep showcases Tehran’s near irrelevance in the dynamics of the fragile South Caucasus. Despite Iran’s efforts to broker some kind of regional agreement to end the conflict, Tehran was quickly proven to be nearly a non-factor. Put simply, it did not have the clout to influence the outcome of the conflict. Instead, the Russians and the Turks shaped the course of the war and its cessation. Now, the Iranians are nervously watching as Russian and Turkish military forces deploy to keep Armenian and Azerbaijan troops apart and uphold the peace agreement. The Iranian regime is embarrassed and it should be. Tehran’s close geographic proximity and deep historic ties to the South Caucasus should make it a natural player in the region, were it not for the Islamic Republic’s overwhelming focus on the Arab world.</p>

<p class="font_8">The fighting between Armenia and Azerbaijan comes at a particularly bad time for Iran. At home, it faces an extremely difficult economic situation thanks to U.S. sanctions. Abroad, it is involved in multiple unfinished geopolitical adventures in the Arab world—from Iraq to Syria and beyond—in which it has invested considerably in recent years.</p>
<p class="font_8">Although it might like to involve itself in the conflict in the South Caucasus, where it has played the role of mediator before, Tehran’s bandwidth to do so is considerably less than its geographic proximity to the conflict might suggest. Worse still, Tehran does not enjoy the diplomatic independence it had in the early 1990s, when fighting between Armenia and Azerbaijan over the disputed territory of Nagorno-Karabakh last erupted on this scale and when the Iranians could more effectively work between the two sides.</p>

<p class="font_8">With the latest polls suggesting a likely victory for the Democrats in the November U.S. presidential elections, a looming foreign policy crisis awaits a potential Biden administration: escalating tensions with Iran. The Democrats have already vowed to abandon Washington’s current “maximum pressure” policy against Tehran — what they refer to as the "Trump administration's race to war with Iran” — and return to the 2015 nuclear agreement, which the U.S. walked away from in 2018. Joe Biden himself recently asserted that he would not only "rejoin the [2015] agreement,” but would use the deal as a “starting point for follow-on negotiations.” In essence, this would be a return to the 2015 Obama-era Iran policy, centered on negotiations and a future deal with Tehran.</p>

<p class="font_8">Following the outbreak of the COVID-19 pandemic, the Tehran Stock Exchange (TSE) took a different path than the rest of the financial world. As markets around the globe plunged, the TSE soared to new heights. In the first four months of the Iranian fiscal year (March 20-July 21), the value of trades increased by 625 percent as compared with the corresponding period a year earlier, and the market hit a record high in early August. In this bull market, even loss-making companies among the roughly 1,000 firms registered on the exchange saw their share prices rise. The TSE lists 500,000 active traders and a total of 12 million registered to buy and sell stocks — equal to around one-seventh of Iran’s 82 million people.</p>

<p class="font_8">In recent weeks, reports of a potential 25-year, $400-billion deal between Iran and China have dominated the conversation about Tehran’s options for freeing itself from the punishing U.S.-imposed sanctions regime on the country. Only time will tell if this so-called strategic agreement can live up to the hype, but China is not alone in seeing an embattled Iran as a major geopolitical and commercial opportunity. Russia too has ambitions of strengthening ties with Iran and its plans for closer economic cooperation appear to revolve around three main drivers at present: Russian arms sales, joint oil and gas projects, and Iran’s role as a transit hub for Moscow’s broader transportation projects connecting Russia to South Asia.&nbsp;</p>

<p class="font_8">On July 27, the White House announced that President Donald Trump has appointed retired U.S. Army Colonel Douglas Macgregor to be the&nbsp;<a href="https://www.whitehouse.gov/presidential-actions/president-donald-j-trump-announces-intent-nominate-appoint-following-individuals-key-administration-posts-072720/" target="_blank">next American ambassador</a>&nbsp;to Berlin. Macgregor, a man who since he retired from the military in 2004 has articulated the need for an overhaul of U.S.&nbsp;<a href="https://www.politico.eu/article/trump-taps-renegade-retired-colonel-for-germany-ambassador-post/" target="_blank">military and foreign policies</a>, has plenty of both supporters and critics in Washington. It turns out, he is quickly dividing Iranians as well. Macgregor’s appointment is already seen by some in Tehran as about more than just an American&nbsp;<a href="https://www.khabaronline.ir/news/1415655/%D8%A2%DB%8C%D8%A7-%D8%A8%D8%A7%DB%8C%D8%AF-%D9%85%D9%86%D8%AA%D8%B8%D8%B1-%D8%AA%D8%BA%DB%8C%DB%8C%D8%B1-%D8%B3%DB%8C%D8%A7%D8%B3%D8%AA-%D9%87%D8%A7%DB%8C-%D8%A2%D9%85%D8%B1%DB%8C%DA%A9%D8%A7-%D8%A8%D8%A7%D8%B4%DB%8C%D9%85" target="_blank">military drawdown in Germany</a>: it is seen as a sign of a broader American policy reorientation in Europe and beyond. While there is clearly an element of wishful thinking on Tehran’s part, if true, this could be good news for the Islamic Republic, which is teetering under the Trump administration’s “maximum pressure” campaign. After all, Macgregor has on record repeatedly&nbsp;<a href="https://www.jns.org/trump-to-nominate-retired-colonel-who-downplays-iran-threat-points-fingers-at-jews/" target="_blank">questioned Washington’s policy toward Tehran</a>.</p>