Both Israel and the United States have for years accused Iran of pursuing a clandestine nuclear weapons program. For its part, the Islamic Republic has been forthright in both its declarations about the purpose and progress of its nuclear program and its adherence to the Nuclear Non-Proliferation Pact, which is more than can be said for either Israel and the United States. Despite repeated unsubstantiated allegations, inspections by the International Atomic Energy Agency (IAEA) have so far failed to reveal any trace of an Iranian nuclear weapons program. Not prepared to let the facts get in their way, the Bush administration has continued to repeat its barefaced allegations in the hope of creating an impression of crisis where one doesn’t actually exist.
The US’ latest demand that the Iranian’s justify their nuclear program suggests that Iran has failed in the past to provide such justification. In fact Iran has repeatedly provided the IAEA detailed explanations of the scope of the Islamic Republic’s nuclear program. In a document dated 6 May 2003 addressed to the IAEA, Vice President Mr Reza Aghazadeh declared "our prime priority of nuclear program is generation of nuclear electricity [sic]…our country needs to develop a long-term strategy to reverse the trend of unrestrained use of fossil resources."  The official US response to Iran’s statements is summed up by State Department official, Richard Boucher, "There’s no economic justification for a state that is so rich in oil and gas like Iran to build these hugely expensive nuclear fuel cycle facilities."  Given that the United States’ argument against the peaceful nature of the Iranian nuclear program revolves around this singular objection, it is worthwhile to examine the Iranian justification in detail to determine its merit.
Iran & Oil
At first glance, Iran’s justification of its nuclear program appears counter intuitive. Iran is an oil rich nation with the third largest confirmed reserves in the world.  Oil extraction costs equate to approximately $2 to $4 per barrel.  Iranian oil therefore is extremely cheap to produce, far cheaper than the massive infrastructure and development costs of a civil nuclear energy program. However, reliance upon Iran’s oil reserves does not factor into the Islamic Republic’s long-term energy strategy.
Firstly, like most oil producers, Iran has recognised that its oil reserves are limited. There is good reason to suspect the accuracy of OPEC’s estimate that Iran has oil reserves of approximately 99080 million barrels. In the late 1980’s all OPEC member states revised their reserves upward, some by almost 200%. There was a simple methodology behind these revisions: oil production quotas were based on declared oil reserves; the greater the reserve, the more oil could be pumped.  There is little qualitative research to back up these revisions. There are also signs that worldwide oil discoveries have peaked and some producers, such as Saudi Arabia, have now reached the maximum level of production capacity.
Like all industrialised nations, Iran faces an increasing domestic demand for energy. According to Iran’s IAEA statement of 5 May 2003, domestic demand consumes 932.9 million barrels of crude per annum, one quarter of which is used to generate electricity.  At this rate of consumption (and assuming continued rate of demand growth of 5%) it does not take a rocket scientist to recognise that Iran’s oil reserves would be depleted by its own domestic consumption within 10 years. This places Iran in an economic quandary. Because Iran subsidises domestic fuel, diverting an increasing share of oil production to meet domestic energy requirements represents both a cost to the Iranian government and a significant loss in export revenue. As Iran’s 5 May statement makes clear, it makes greater economic sense to divert Iran’s oil resources towards the export market and seek alternative energy sources to meet domestic energy needs.
It is worth noting that Iran has substantial natural gas reserves that could be tapped to provide an energy alternative to oil. Nevertheless, this solution does not resolve all Iran’s future energy concerns. Firstly, the plateauing of worldwide oil resources over the next decade will increase demand for fossil fuel alternatives, such as natural gas.  Regardless of natural gas reserves, once oil production rates plateau, the price of both oil and alternative fuels will begin to dramatically increase. Iran (and other producers) will face significant economic and political pressure to divert larger and larger shares of her fuel resources to the export market.
One final concern, which is not regularly reported in the press, is the problematic issue of Iran’s existing energy infrastructure. Iran’s main oil and gas fields lie in the south of the country, mostly along the Persian Gulf littoral; Iran’s capital and 80% of the country’s population lies in the country’s north. Currently, oil is piped north from the Gulf port at Khark, but energy demand has now exceeded the pipe’s 1.4 million barrel a day capacity.  Enlarging the pipeline to increase the flow of oil or gas is both uneconomical and does not address long-term concerns. For several years Iran has sought to overcome this problem by negotiating oil swap transactions with Central Asian oil producers, such as Azerbaijan, Kazakhstan and Turkmenistan. In an oil swap, the Central Asian states deliver an agreed volume of oil to Iran’s Caspian Sea port of Neka, where it is processed for domestic use. Iran then makes available the same volume of oil from its Gulf port at Khark. All parties benefit from the transaction: Iran supplies its own domestic energy needs without the expense of cross country piping and the landlocked Central Asian states are able to get their oil to international markets. US pressure on Azerbaijan and Kazakhstan not to trade with Iran has stymied earlier oil swap negotiations, however, Kazakhstan has recently agreed to begin supplying Iran with 500,000 barrels a day in an oil swap contract. 
Iran & Nuclear Energy
Iran’s research into the nuclear power option is not new. In fact, Iran’s nuclear program began in the March 1975, when the United States was contracted to construct eight large civil nuclear reactors.  Construction began at several sites, including an experimental reactor at the University of Tehran and at Bushehr on the Gulf coast. Construction ceased with the collapse of the Shah’s regime in 1979. The Bushehr reactor was severely damaged by Iraqi bombing during the Iran-Iraq War in the early 1980’s, undoubtedly to the great comfort of the United States.
In 1984, Iran revived its nuclear research program with Russian and Chinese help. The US has vehemently opposed these developments. US financial pressure delayed Russia’s fulfilment of its contract during the 1990’s, however, this only made Iran more determined than ever to implement a completely indigenous nuclear program. In order to free itself from reliance on Russian support, Iran accelerated the mining of domestic uranium resources from a site near the central Iranian city of Yazd. It is this, more than any other development, which causes alarm in the US. Iran now has the potential to successfully manage its own nuclear energy cycle; from mining and refining, through to energy generation and waste disposal (including the potential to reprocess weapons grade Plutonium), without reliance on any external party.
Iran, the US & Nuclear Proliferation
Iran has been a signatory of the Nuclear Non-Proliferation Treaty since 1970 and has always insisted its nuclear program is wholly peaceful. Nevertheless, we must also consider the possibility that a peaceful nuclear program may lead to a weapons program. India, Pakistan and Israel all developed a covert nuclear weapons program under the cover of a civil program. They have also refused to sign the Non-Proliferation Treaty. Despite Iran’s current compliance, there can be no guarantee that Iran will not pursue nuclear weapons in the future.
This is the crux of the US’ policy of pre-emption -” the prevention of future potential. The US argues that the issue is nuclear proliferation, which must be avoided at all costs. But the US itself sets a poor example. The Bush administration has withdrawn from nuclear test ban and proliferation treaties, refuses to open its own facilities to international inspectors, has active nuclear weapons development programs and has recently promulgated a foreign policy that approves limited nuclear war against non-nuclear armed nations. In an interview on BBC Radio Four, cheerleader and unofficial spokesman for US foreign policy, British Prime Minister, Tony Blair recently justified the joint US/UK invasion of Iraq on the basis of preventing nuclear proliferation. He said, "If we didn’t take a stand on Iraq how on earth were we going to get North Korea back into public dialogue and make Iran cooperate with the International Atomic Energy Agency?"  Once again an impression that Iran is not co-operating is created. Forgetting for one moment that Iraq did not have any active nuclear program, one must ask how the current US approach of ignoring North Korea’s stated nuclear capability prevents nuclear non-proliferation? 
There are other even more glaring contradictions. Why are Pakistan, India and Israel exempt from US pressure to sign or comply with the NPT? Also, the US has consistently refused to consider Iranian (and Iraqi) proposals to make the Middle East a nuclear free zone. Such a posture makes a mockery of the US’ stated concerns. In fact, it is the US and UK’s refusal to operate within the boundaries of international law that encourages nuclear proliferation; the lesson of Iraq invasion is clear -” nuclear weapons are perhaps the only defence against a rogue superpower. Even former staunch US ally Saudi Arabia has begun investigating its own nuclear deterrence options.
The United States’ claim that Iran, as an oil producer, has no legitimate need for a civil nuclear program does not stand close scrutiny. Iran’s oil wealth is limited and the development of alternative energy sources to replace fossil fuels is a prudent and legitimate undertaking for a sovereign state. In fact, such a claim flies against the United States’ own experience for the US began developing its civil nuclear program at a time when it was still a net oil exporter. The US’ primae facie case against Iran is clearly unsupported on the evidence, but then this is to be suspected. US -” Iranian relations have long been dominated by US arrogance, intransigence and misrepresentation. Unproductive statements and wild claims that "Iran aggressively pursues [nuclear] weapons and exports terror"  reveal continued US animosity towards Iran that dates back at least to the 1979 Revolution. As James Bill in his analysis of US -” Iranian relations observed, the US has never really attempted to understand Iranian motivation. The situation remains unchanged today. Iran’s nuclear program does have a purpose beyond generating electricity. It gives the Islamic Republic something that is fundamentally important to Iran but intolerable to the US -” freedom to act independently. A wholly indigenous nuclear program enables the Islamic Republic to manage its own energy resources to its maximum advantage, it frees the Iranians from reliance on Russian and other foreign technologies and supplies, and it allows Iran to manage its own technological development. It is a demonstration of national will and sovereignty.
. Iran’s Nuclear Policy (Peaceful, transparent, Independent). R Aghazadeh. 6 May 2003. IAEA statement
. US pressures Iran nuke pursuits. The Sunday Times. 11 March 2003
. OPEC 2002 Annual Statistical Bulletin (ASB).
99080 million barrels of oil and 26600 billion cubic metres of natural gas.
. George Bush, State of the Union address. 2002.