Skip to Content News Archives Economy Energy Oil & Gas Renewables Electric Vehicles Mining Commodities Agriculture Real Estate Mortgages Mortgage Rates Finance Banking Insurance Fintech Cryptocurrency Work Wealth Smart Money Wealth Management Investor Personal Finance Family Finance Retirement Taxes High Net Worth FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials More Innovation Information Technology FP500 Podcasts Small Business Lives Told Tails Told Shopping Financial Post Store Obituaries Place a Notice Advertising Advertising With Us Advertising Solutions Postmedia Ad Manager Sponsorship Requests Classifieds Place a Classifieds ad Working Profile Settings My Subscriptions Saved Articles My Offers Newsletters Customer Service FAQ News Economy Energy Mining Real Estate Finance Work Wealth Investor FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials HomePMN BusinessTrump's Fears About Economy Undercut US Leverage in Iran TalksPresident Donald Trump said the prospect of global economic collapse was a big reason he signed an interim peace deal with Iran. That admission exposes a key US weakness heading into the next round of talks with Tehran.Author of the article: You can save this article by registering for free here. Or sign-in if you have an account.71]61feeofygcga6gwuiy9oe_media_dl_1.png Organization for Economic Cooper(Bloomberg) — President Donald Trump said the prospect of global economic collapse was a big reason he signed an interim peace deal with Iran. That admission exposes a key US weakness heading into the next round of talks with Tehran.Subscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.Subscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountorThe memorandum of understanding that Trump signed on Wednesday reopened the Strait of Hormuz and set in motion waivers for sanctions on Iran’s oil sales to the international market. The effect was immediate: The price of oil tumbled further and US stocks rose, facts that Trump pointed to at a press conference in France this week.“I didn’t want to see economic catastrophe,” Trump said at a press conference in Evian, France on Thursday. “If you kept this going, that could’ve happened.”Get the latest headlines, breaking news and columns.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againThat acknowledgment undercuts the US negotiating position as the two sides plan to open talks in Switzerland on Sunday. Under the deal, they have 60 days to discuss imposing limits on Iran’s nuclear program and granting Iran economic relief. Knowing that Trump will be reluctant to restart the military campaign — and thus spark fresh economic turmoil — eases the pressure for Iran to end the talks quickly.Indeed, even before the talks opened, Iran on Saturday announced it was closing Hormuz in response to new strife between Israel and Lebanon.The pressure on the US may only get worse. A prolonged conflict could trigger the deepest global slowdown in 40 years. At home, the war in Iran has proved deeply unpopular, with 56% of Americans saying it has impacted US interests more negatively than positively, according to a poll from the University of Maryland. With midterm elections approaching in November, members of Trump’s own party are raising concerns and the Republican-led House even voted to halt the war with Iran earlier this month. “Taken as a whole, the 14 points in the MOU put Tehran in a strong negotiating position as the two sides tackle the nuclear file,” said Chris Kennedy, the economic statecraft lead at Bloomberg Economics and a former State Department official. While US officials have previously insisted that Iran’s nuclear program was important enough to justify going to war, Vice President JD Vance suggested this week it was already destroyed and appeared almost ambivalent about insisting the nuclear negotiations yield a breakthrough for Washington.“Iran is weakened, their nuclear program destroyed, their economy in desperate straits, and if they change their behavior, big things are going to happen for Iran and for the war,” Vance said. “If they don’t, no skin off our backs.”The problem for the US is that the deal was skewed in Iran’s favor, giving the country broad gains before the next round of talks even begin. A Bloomberg Economics analysis of the 14-point agreement found that 10 points favored Iran versus just one advantaging the US, with the other three being neutral. Under the memorandum, the US is set to grant sanctions waivers for Iran to restart oil exports immediately and open the door for eventually ending all sanctions programs as part of the 60-day negotiations. Iran also gets a $300 billion development program to help with reconstruction after the conflict. The US concessions have already prompted pushback and anger from Republican lawmakers. Iran’s main concession is that it has essentially reaffirmed never to pursue a nuclear weapon, a promise it had already made under the 2015 nuclear deal. The US may be able to re-open the Strait of Hormuz — the closure of which spiked global energy prices — but that waterway was open before Trump’s war.The agreement also says the planned 60-day negotiating period is “extendable,” which raises the prospect that talks could drag on for many months. That’s an outcome that suits Iran more than it does the US, according to Miad Maleki, a former US Treasury sanctions official who is now a senior fellow at the Foundation for Defense of Democracies.“You don’t trade away your nuclear program for sanctions relief you’re already receiving,” Maleki said. “The US can still escalate militarily, but it has dismantled its economic leverage at the exact moment it needs it most.” Join the Conversation This website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.