Overview: Iran Analysis Weekly Report May 15, 2016
15 May, 2016
Vistar Business Monitor
Reformists and moderates have sent 121 candidates to the parliament under the Omid list. Some 40 moderate conservative candidates who are close to Ali Larijani have also been supported by the Reformists and sent to the parliament. Ultraconservatives, including the Paydari Front, managed to capture 90 seats, and 81 lawmakers are independent.
The figures show that the majority of the parliament seats have already been captured by Reformists and Moderates. Apart from moderate candidates, the majority of independent lawmakers are also expected to join the Reformist fraction. The Omid fraction, then, seems to be composed of 160-170 lawmakers. This fraction is expected to attract some conservatives and many of the independent lawmakers.
With the parliament elections behind us, and considering the relative victory for president Rouhani and the Reformist/Moderate camp, now all the focus has turned to who will become Majles speaker. Despite the fact that the majority fraction in the next parliament is composed of Reformists, pro-administration figures, moderate conservatives and a number of independent lawmakers, it would not be powerful enough to win when it comes to the speaker position.
Therefore, the expectation is the majority fraction will give up the position in favor of Ali Larijani. The reason is that Reformists’ position in the 10th Majles is still fragile (perhaps because of their mass disqualification by the Guardian Council), many independent lawmakers have not yet decided which way they would go. However, the external pressure prevents lawmakers from voting in favor of a Reformist like Mohammad Reza Aref to become speaker, simply because top conservative authorities believe they should not let Reformists and moderates to be in control of the administration and parliament both.
On the foreign banks note, last Thursday, nine large European banks held a meeting with John Kerry, US Secretary of State and Philip Hammond, the British Foreign Secretary regarding their concerns to resume working with Iran now that the sanctions have been removed. Some of these banks had been fined in previous years for sanctions violations through doing business with Iran. Since the removal of sanctions, the big banks have been reluctant to resume working with Iran, as some US sanctions are still imposed on the country. According to the media, Kerry has assured the banks that they can resume working with Iran, when it covers legitimate business and checks are carried out on the trade partners.
Oil prices seesawed last week, dipping as low as $43/b (WTI) early in the week, then surging past the $47/b mark briefly last Friday. The main cause of the initial price surge was market uncertainty over the unexpected replacement of the veteran Saudi Oil Minister Ali al-Naimi with new Minister Khalid al-Falih.
OPEC countries produced 32.44 million barrels per day of oil in April, indicating a 188,000 bpd increase over the month before, while forecasting that the supply glut will last over the course of 2016. The March to April jump in output is said to be the highest since 2008.
On the Syria note, over 13 IRGC 25th Karbala Division members were killed and 21 were wounded during an opposition offensive on the town of Khan Tuman located south of Aleppo. Supreme National Security Council Secretary Ali Shamkhani vowed retaliation for the attack.
Iranian news outlets also reported that an IRGC member from Tehran province, an IRGC brigadier general second class, an IRGC Quds Force commander, and a “large number” of casualties from the Afghan Shia militia Fatimiyoun Brigade were killed during the fighting in and around Khan Tuman.
Russia, Syria, and Hezbollah will not leave the attack in Khan Tuman unanswered. Supreme National Security Council Secretary Ali Shamkhani vowed retaliation for the attack in Khan Tuman and claimed that the opposition forces were “abusing the goodwill of Iran in the ceasefire.”
Table of Contents
Notes
Overview
News Highlights
Politics and International Affairs
Economy
Trade and Agreements
Economic Affairs
Macro-economy
How Political Hurdles and Power Struggles will affect Economic Growth in Iran
A Changing Economy
Large Economic Benefits
Rouhani’s Challenges
Infiltration into the Central Bank of Iran with the Excuse of Fighting Usury
Opposing a Fall in Reserve Requirement
Macro-economic Data
Oil and Gas
Weekly Review
Iran Offers a Discount to its Asian Oil Buyers
Domestic Affairs
10th Parliament, Fraction of Majority
Grapple to Conquer Parliament Speaker
Principlist Leader Speaks about Political Parties
Minoo Khaleghi Disqualification
No Easy Way for Rouhani to Implement Reforms
Key Political and Economic Calendar
International Affairs
Laws, Regulations and Policy Updates
Sanctions
Iran Sanctions-Lifting Continues to Be Unfulfilled
Financial Markets
Tehran Stock Exchange
Foreign Exchange Market
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