Iran

US and Iran reportedly initiate indirect negotiations over nuclear program
According to various but somewhat conflicting reports this week, Iran and US officials have initiated informal and limited negotiations regarding the Iranian nuclear program – possibly aimed at restoring the 2015 Joint Comprehensive Plan of Action (JCPOA). As discussed in the previous Talos Regional Report, the discussions were first reported by the Middle East Eye, with the outlet claiming an initial agreement of sanctions relief was reached. This was almost immediately denied by US and Iranian officials, yet various reports subsequently confirmed that negotiations between the two sides have restarted. On 14 June, the New York Times reported that the Biden administration has been “negotiating quietly” with Iran with a view to reach “an informal, unwritten agreement” to prevent “further escalation.” Citing unnamed US, Israeli, and Iranian officials speaking anonymously, the report says the negotiations have been taking place in Oman, where the negotiations preceding the JCPOA were initiated.

The content of the discussions remains characteristically vague but separate reports discussed efforts to curb Iranian nuclear activities in exchange for limited sanctions relief which, if true, would suggest a small first step towards a broader agreement similar to the JCPOA. The reports notably coincide with a change in rhetoric from Iranian officials, including Supreme Leader Ayatollah Khamenei who, on 11 June, said there is “nothing wrong with an agreement with the West” as long as Iranian nuclear infrastructure remains intact.

To recall, talks to restore that deal were suspended following the outbreak of anti-government protests in Iran in September 2022, but the reported restart of negotiations follows multiple disconcerting developments associated with the Iranian nuclear program that may have incentivized the West to consider re-engagement. This includes the construction of an underground facility near Natanz and advancements in Tehran’s ballistic missile program, including the recent unveiling of a hypersonic missile which, while separate from the JCPOA negotiations, has fuelled broader concerns about Iranian activities. The reports notably follow several prisoner exchanges conducted between Iran and several countries in the West which were likewise assessed as initial steps of a broader dialogue.

The future progress of the discussions will be monitored closely yet it remains to be seen if the resumption of negotiations will produce the sort of breakthrough both sides were unable to achieve during 2021-2022. Political opposition on both sides for a restoration of the JCPOA remains high and has arguably increased in the West considering Iran’s crackdown on the 2022 protest wave as well as its increasingly close alliance with Russia since the Ukraine invasion. Reactions from regional stakeholders – including Israel, Saudi Arabia and other GCC states – will also be important to consider in terms of assessing the prospects for a permanent agreement.

President Raisi embarks on regional tour in Latin America
Iranian President Ibrahim Raisi arrived in Venezuela this week where he met with his counterpart Nicolas Maduro as part of a five-day tour in Latin America that also included visits to Nicaragua and Cuba. The two sides reportedly signed 19 Memorandums of Understanding (MoU) in various fields including energy, petrochemicals, agriculture and maritime support which Raisi said aimed to increase bilateral trade to up to $20 billion. In a press conference, the two leaders alluded to the existence of “common enemies” and a mutual desire to enhance their “strategic relationship” as part of a wider outreach to other “freedom-seeking nations” in a “new world order”.

The visit came only days after Maduro visited Tehran during a regional tour in the Middle East and follows the signing of similar agreements in 2022, which are intended to expand oil trade cooperation as part of a wider effort to circumvent US sanctions. The timing of the latest visit is noteworthy in light of Iran’s simultaneous re-engagement with the US and is plausibly aimed to enhance Iranian leverage in any negotiations. Similar to its ties with Russia and China, by enhancing economic relations with states like Cuba, Venezuela, and Nicaragua, Tehran seeks to consolidate an “anti-western” alliance that would limit its dependence on the West and, by extension, the perceived need for sanctions relief.

Saudi Foreign Minister to visit Iran
According to Iranian state-linked sources, Saudi Arabia’s Foreign Minister Prince Faisal Bin Farhan will visit Tehran on 17 June where he is expected to meet with his counterpart Hossein Amirabdollahian, President Raisi and other senior officials. The visit has fueled speculation of an impending reopening of the Saudi Embassy in Tehran which is likely to be the main topic of discussion during the visit. This follows the reopening of the Iranian embassy in Riyadh on 7 June. Saudi officials and state media have not confirmed the visit.

IRGC announce launch of military operation in Kurdistan Province
On 14 June, the Islamic Revolutionary Guard Corps (IRGC) released a statement announcing the start of a limited military operation targeting areas in the Kurdistan Province of northwestern Iran. The operation is targeting what the IRGC described as “anti-revolutionary groups” in the Sarvabad district, near the border with the KR-I. A local IRGC commander accused these groups of creating instability in the area and of harming local civilians and said the operation will continue until these groups are fully eliminated.

Further details of the operation remain limited however multiple opposition-linked sources reported clashes in the vicinity of Sarvabad, with at least one IRGC member killed in a confrontation with the Kurdistan Free Life Party (PJAK). Local reports also discussed UAV and artillery strikes targeting positions near the cities of Ravansar and Paveh, located in the neighboring Kermanshah province. The start of the operation follows the previously discussed reports of security deployments to these areas which, combined with Iranian diplomatic pressure on the Government of Iraq, spurred concerns of cross-border strikes into the KR-I.

Shop owners strike in Saqqez, Iran
Limited protest activity continues to be reported across the country. Shop owners in Saqqez, a Kurdish city in western Iran, staged a strike on 13 June in protest against the arrest of the family members of demonstrators and alterations to a cemetery holding the bodies of protestors, including Zhina (Mahsa) Amini. Activist groups had encouraged this peaceful demonstration in response to the arrest of families in Sanandaj, Divandarreh, and Dehgolan by Iranian security forces. Concurrently, the city’s municipality was reported to be reducing the visibility and accessibility of Amini’s shrine in Aichi cemetery, which has also been desecrated multiple times in recent months. Despite the deployment of large numbers of security forces to the streets of Saqqez, similar strikes were also observed in parts of Sanandaj.

Syria

Israeli airstrikes conducted near Damascus
On 14 June, according to Syrian state-linked sources, suspected Israeli airstrikes targeted various sites in the vicinity of Damascus, with at least one Syrian government soldier wounded. The relatively limited reporting discussed strikes in areas southwest of the capital, including near Damascus International Airport – an area associated with military sites operated by Syrian government forces and Iran-backed militia groups that have been targeted repeatedly in the past. Air defense systems reportedly intercepted the majority of the missiles, but material damage was inflicted as a result. The operations on 14 June follow similar strikes conducted in late May which subsequent reports stated targeted military warehouses and arms depots operated by Syrian government forces.

Jordanian army intercepts UAV carrying narcotics from Syria
On 13 June, the Jordanian Army announced that a UAV carrying narcotics was intercepted and prevented from entering Jordanian territory. The UAV carried approximately 500 grams of crystal methamphetamine and was intercepted on the Jordanian side of the border, in an unspecified location. The statement refrained from attributing blame but underscored that security forces will continue to take action to disrupt narcotics smuggling activities.

The interception is significant in light of Jordan’s intensified efforts to disrupt the cross-border narcotics trade which the government attributes in part to Iran-linked militia groups and the Syrian Amy. In January, Jordanian army elements engaged in a lethal firefight with cross-border smugglers near the city of Mafraq, and some of the smugglers were later identified as members of the Syrian army. Jordan has since increasingly publicly accused the Syrian Government and Iranian elements of being complicit in the trade. In May, Jordan also escalated operations by conducting rare cross-border airstrikes targeting narcotics sites in the Da’ra province, which Jordanian security claimed were being operated by Iranian-backed militias. The Syrian government, Iran, and Iranian-backed factions continue to deny these accusations however the interception this week again elucidates the issue which is increasingly emerging as a source of tension between Jordan, Syria, and Iran.

Intensification in Turkey-PKK activity in northern Syria
An escalation in Turkey-PKK activity was observed this week in northern Syria, as both sides conducted several attacks during the week. On 10 June, YPG-linked sources said an airstrike targeted a vehicle carrying YPG members in the Ahdath area of Aleppo province, killing three members of the organization. The next day, at least ten rockets targeted the Turkish Kaljebrin base, located near the Bab al-Salama Border Crossing Point in northern Aleppo.

No casualties or damages were confirmed, however Turkish forces responded by conducting artillery and UAV strikes in multiple areas of Afrin, allegedly “neutralizing” seven YPG members. On 14 June, additional Turkish UAV strikes were conducted in Hasakah province, targeting a vehicle in the Shorek area between Qamishli and Qahtanyah. According to the Syrian Observatory of Human Rights, four members of the Syrian Democratic Forces were injured as a result, and several vehicles were damaged. The strikes are not unprecedented yet form part of a recent intensification in anti-PKK operations observed across the region, including in northern Iraq and Syria. Also, the 14 June UAV strike took place a day after the PKK announced an end to a four-month unilateral truce (see Turkey section).  Speaking with an international media outlet, a spokesperson for the SDF confirmed that Turkey has intensified operations in Syria since the Presidential elections.

Russian soldier killed by suspected Turkish artillery strikes
On 12 June, in a likely related development, a vehicle transporting Russian soldiers was targeted by Turkish artillery fire near Tall Rifa’at, killing a Russian soldier and injuring several others. The circumstances of the incident remain unclear, but it was reported in an area where both YBG and Syrian Government Forces remain present and maybe a case of mistaken identity. In an assessed effort to downplay any political tension, the Russian Ministry of Defence and the Syrian Government refrained from commenting on the incident, however video footage depicted several service members being evacuated by a Russian military helicopter in the aftermath. The Turkish Ministry of Defence dismissed the reports as “untrue”.

Turkey

PKK announce end of truce in response to heightened Turkish activity
In a statement disseminated via the Kurdistan Communities Union (KCK) – an umbrella organization for several Kurdish confederalist entities including the PKK – the PKK announced this week an end to the unilateral truce declared against Turkish forces in Turkey in February. To recall, the truce was initially declared to allow the mobilization of resources in areas affected by the earthquake on 6 February and was subsequently extended over the Turkish elections period, arguably to deny the ruling AK Party political ammunition resulting from PKK activities.

In its statement, the PKK cited various factors, including the continuation of Turkish operations during the truce period and a recent intensification in Turkish activity, as reasons to restart operations. The KCK pointed to the UAV strike near Sulaymaniyah Airport in April and the recent resumption of UAV strikes in the Sinjar district as examples of Turkish “aggression” during the truce. The statement also cited the Turkish government’s continued crackdown on Kurdish leaders and politicians in Turkey, as well the prison conditions of PKK co-founder Abdullah Ocalan.

The conclusion of the truce understandably sets conditions for an intensification in PKK-Turkey activity, as seen this week in Syria and as recently observed in Iraq following the general elections in Turkey. In its first meeting since the elections, the National Security Council in Turkey pledged last week that it would continue its operations against the PKK and other “terrorist elements” – a largely expected statement that confirms the continuity of Turkey’s regional posture under President Erdogan.

Iraq

Iraq Parliament approves national budget
On 12 June, the Iraqi Parliament voted to approve the national budget for the fiscal years 2023, 2024, and 2025. The $152 million bill is the largest ever in terms of total spending and is projected to generate $103.3 billion worth of revenue, calculated at oil prices averaging $70 USD/barrel and exports calculated at 3.5 million barrels per day. As discussed in the full report, the size of the budget was significantly inflated by a larger public sector wage bill that adds some 600 thousand new government employees that will raise the total cost of public wages and pensions to an estimated $58 billion. Nearly all of this will be financed with crude exports, leaving the national finances over the coming years significantly vulnerable to oil price fluctuations and export disruptions. The International Monetary Fund (IMF) warned of short-term inflationary concerns and exchange rate volatility associated with rising deficits that may impact financial stability. Worse, in the medium term, the fund warned that oil price fluctuations may lead to “critical macroeconomic stability risks” over the coming years. Further details and context of the budget discussions are provided in this report and the Talos Weekly Analysis Report.

Saudi Arabia

Arab-China Business Conference concludes several agreements
The Arab-China Business Conference, an annual two-day conference organized to promote investment ties between China and the Arab world, concluded in Riyadh on 12 June. More than 30 separate investment agreements, worth a combined $10 billion, were reportedly concluded over the course of the conference which attracted business leaders and government officials from 26 countries. The event concluded with the announcement of the Riyadh Framework –  a nine-point document outlining a plan to strengthen cooperation between the Arab countries and China in various fields. The majority of the agreements concluded were made between Saudi and China-based entities, and primarily involved Chinese plans to invest in Saudi Arabia.

The conference and related agreements underscore Saudi Arabia’s growing economic ties with China, previously highlighted by President Xi Jinping’s participation in the China-GCC Summit in 2022 and Saudi oil company Aramco’s recent investments in China’s petrochemicals industry. The conference took place only days after US Secretary of State Anthony Blinken visited Saudi Arabia to hold what was described as “candid” talks with Crown Prince bin Salman. In a subsequent meeting with Saudi Foreign Minister Bin Farhan, Blinken appeared to play down any issues associated with Saudi Arabia’s growing ties with China, saying the US is not asking anyone to choose sides and even “applauded” China’s role in brokering the Iran-Saudi agreement. For their part, Saudi officials, including Prince Farhan, have reiterated that economic relations with China do not affect its security partnership with the US and that both partnerships yield positive but separate benefits for the country.

Kuwait

US approves sale of fighter jet support agreement to Kuwait
On 13 June, the US State Department approved the sale of a combat aircraft technical support agreement for Kuwait’s fleet of F/A-18 fighter jets. According to the Defense Security Cooperation Agency (SCA) of the Department of Defence, the agreement is worth $1.8 billion and includes the continuation of contractor engineering technical service, maintenance and avionics software over a three-year period.

The agreement allows Kuwait to extend the service of its current fleet of F/A-18 jets which are gradually being phased out for the new F/A-18E and F Super Hornets purchased as part of an agreement signed with the US in 2016. The new jets were initially planned to enter service by 2022 yet delays caused by the Covid-19 pandemic mean they have yet to enter service and it remains unclear when the new variants will be deployed.

In a separate development this week, Kuwait also announced the purchase of medium-range Baykar Bayraktar TB2 combat UAVs from Turkey. The agreement was announced by the Kuwait Army on 13 June and is reportedly worth approximately $367 million yet, as usual, the number of UAVs included in the deal was not made public. Kuwait is now the 28^th country that has purchased the combat UAV developed by Baykar.

Yemen

Three killed in clashes between AQ and pro-government forces in Yemen
On 10 June, clashes were reported in southern Shabwa province as suspected al-Qaeda militants conducted an attack against members of the pro-government Shabwa Defence Forces. At least two members of the Shabwa forces and one militant were killed in the clashes that reportedly lasted for several hours. Local sources claimed the engagement ended when the militants withdrew to a mountainous area nearby.

The incident follows months of reduced hostilities, including amongst militant factions like al-Qaeda that were not part of the previous six-month truce and is the deadliest attack conducted by al-Qaeda this year. The period of prolonged inactivity, while positive, has fueled some concerns about the ability of militant factions to reorganize and regroup, with the latest attack likely intended to underscore al-Qaeda’s continued presence and capability to inflict damages on pro-government forces.

US Envoy in Saudi Arabia to discuss peace process in Yemen
Relatedly, the US Envoy to Yemen Tim Lenderking arrived in Saudi Arabia to “advance efforts” to “launch a comprehensive peace process” in Yemen, according to a readout by the US State Department. Meeting with Saudi Prince Khalid bin Salman on 14 June, an official statement said the two discussed the “latest developments” in the conflict and ways to “reach a comprehensive political solution”, yet no further details or significant breakthrough was noted.

The visit follows months of relative diplomatic inactivity and a lack of progress that quelled expectations of a breakthrough in the peace process in March when leaders on both sides indicated a truce extension was likely. The initial optimism was fueled by the Iran-Saudi agreement concluded that same month, yet reports that the negotiation would be resumed never materialized and the current state of the peace process remains unclear. Last month, Lenderking said the US has not observed any significant change in Iranian activities, suggesting that Tehran continues to provide arms and equipment to the Houthi Movement.

Earlier this month, the Houthi Movement and Saudi-backed government also announced that a planned second round of prisoner exchanges was postponed indefinitely – a decision seen as a setback for the peace process. The relative lack of hostilities in the country remains a positive indicator still, however the prospects for a more permanent settlement to be reached remain currently limited.