Iran’s Supreme Leader rules out talks with U.S. as tensions rise in wake of attack on Saudi oil facilities

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Iran’s Supreme Leader has ruled out any negotiations with the United States, further escalating tensions in the wake of a stunning weekend attack that targeted the heart of Saudi Arabia’s oil industry.

Ayatollah Ali Khamenei said Tuesday that Iran will not negotiate with the United States until the Trump administration reverses course and rejoins the multiparty nuclear agreement that U.S. President Donald Trump walked away from in 2018. The statement seemed intended to quash talk that Mr. Trump would meet with Iranian President Hassan Rouhani on the sidelines of next week’s United Nations General Assembly meeting in New York. It also dimmed hopes that diplomacy could help avert a conflict between Iran and the U.S. and its allies.

Also in motion Tuesday was a crucial election in Israel, where the next prime minister could quickly find themselves dealing with conflict on one or more fronts should Tehran decide to activate allies such as the Hezbollah militia in Lebanon or the Islamic Jihad group in the Gaza Strip. With exit polls suggesting a virtual dead heat between Prime Minister Benjamin Netanyahu’s right-wing Likud party and the centrist Blue and White, it could be weeks before a new Israeli government is formed.

Tensions have spiked across the Middle East since Saturday, when a series of explosions rocked Saudi Arabia’s Abqaiq oil processing plant as well as the nearby Khurais oil field.

While Yemen’s Houthi rebels were quick to claim responsibility, there is widespread skepticism that the Iranian-backed insurgents have the technological capability to hit well-defended oil facilities.

Several U.S. media outlets, including The Wall Street Journal and CNN, quoted unnamed U.S. government officials saying there was a growing consensus in the intelligence community that the attack – which involved a mix of cruise missiles and explosives-laden drones – was carried out directly by Iran from Iranian soil.

If that consensus solidifies into a conclusion, the question will quickly become what Mr. Trump and Saudi Arabia’s de facto ruler, Crown Prince Mohammed bin Salman, decide to do about it. Both men have reputations for tough talk and unpredictable actions.

On Tuesday, Riyadh struck a distinctly multilateral note – calling on the international community to “shoulder its responsibility” and confront Iran, even as some in Washington are taking a more hawkish stance.

“The target list I would put on the table if there is a military strike would be the Iranian oil refineries,” Lindsey Graham, a prominent Republican senator seen as close to Mr. Trump, told CNN. “Nobody’s talking about invading Iran, but we want to make them pay a price for trying to disrupt world order.”

Mr. Trump himself has vacillated between implied threats of war and musing about a possible diplomatic resolution. He declared Sunday through Twitter that the U.S. was “locked and loaded” and waiting only for the Saudis to say who was responsible for the attack. A day later, he told reporters that the diplomatic route was “never exhausted,” adding that he “would certainly like to avoid” a war with Iran.

The shifting line from the White House is nothing new. Mr. Trump’s policy of trying to escalate pressure on the Iranian regime while also saying he wants to avoid getting tangled in a Middle Eastern war has created a situation where Iran feels both cornered and emboldened.

Ayatollah Khamenei’s remarks made clear that Tehran sees the current round of hostilities as rooted in Mr. Trump’s May, 2018, decision to withdraw from the multinational agreement known as the Joint Comprehensive Plan of Action, or JCPOA. That deal, which was signed in 2015 by the Obama administration, saw Iran suspend its nuclear ambitions in exchange for the lifting of some economic sanctions.

Mr. Trump came to office vowing to tear up the deal, saying that even if Iran was complying with caps on uranium enrichment, the deal was defective because it did not require Iran to give up its missile-building program or cease supporting armed groups around the Middle East.

To Tehran, Mr. Trump’s move to leave the pact and reimpose sanctions marked the beginning of renewed U.S. economic warfare. Iran’s gross domestic product contracted 3.9 per cent in 2018 – after two years of impressive growth – and is expected to shrink a further 6 per cent this year.

“If U.S. repents and returns to JCPOA … then it can join and talk with Iran,” Mr. Khamenei said in a statement. “Otherwise no negotiation will take place between Islamic Republic and U.S. officials at any level.”

As the economic pressure has escalated, Iran has been blamed for a series of increasingly brazen strikes targeting global energy supply. First came a series of mysterious attacks on oil tankers, and now the air strikes on Abqaiq and Khurais.

The curtains are also being pulled back on a regionwide shadow war between Iran and Saudi Arabia, the two would-be leaders of the Muslim world. For 15 years, they have battled each other through proxy forces – most recently in Syria and Yemen and before that in Lebanon and Iraq. Now, if U.S. intelligence is correct, Iran has decided to start hitting its enemies directly.

Iran has also threatened to target U.S. military forces in the region should Mr. Trump order them to get involved. “Everybody should know that all American bases and their aircraft carriers in a distance of up to 2,000 kilometres around Iran are within the range of our missiles,” Amirali Hajizadeh, the head of Iran’s Revolutionary Guards Corps Aerospace Force, said Monday.

Israel could quickly become another front if hostilities escalate. Tuesday’s election came less than three weeks after a tit-for-tat exchange of fire across the Israel-Lebanon border that was the biggest since the Israeli military and Hezbollah fought a devastating month-long war in 2006.

Mr. Netanyahu reportedly considered asking for the election to be postponed so he could order a military operation in the Gaza Strip after rockets fired by Islamic Jihad forced him to seek cover in the middle of a campaign event.