U.S. officials confirmed on Wednesday that the Biden administration sent its response to Iran's comments on the EU draft agreement that would restore the Iran nuclear deal.

Why it matters: The U.S. move is another step toward a deal, though there are still gaps between the parties on several issues. It's not clear whether there will be another round of negotiations as a result of the U.S. response.

Driving the news: An Iranian Foreign Ministry spokesperson confirmed the U.S. response was received through the EU coordinator.

• The spokesperson said Iran will carefully study it and will share its comments with the EU coordinator upon completion of the review.
• A State Department spokesperson did not provide any details about the U.S. response.

The big picture: Separately today, Israeli Prime Minister Yair Lapid stressed in a briefing with the international press that he is concerned the U.S. and other Western powers will give more concessions to Iran in order to reach a deal on a return to the 2015 nuclear agreement.

• The White House has repeatedly denied it's considering new concessions. But Lapid's warnings have become more urgent in recent days as signs emerge that negotiators are close to locking in an agreement.

What he's saying: Lapid said the EU draft agreement was defined as a “final offer” and presented as "take it or leave it," but the Iranian response to it included more changes that led to further discussions.

• “The Iranians are making demands again. The negotiators are ready to make concessions, again. The countries of the West draw a red line, the Iranians ignore it, and the red line moves. If the Iranians didn’t take it, why didn’t the world leave it?” Lapid said.
• The prime minister also said Israel thinks the nuclear deal does not meet the standards set by President Biden for preventing Iran from becoming a nuclear state.
• Lapid added that if a deal is signed, Israel won’t be bound by it and will act to keep Iran from becoming a nuclear power.

Israeli national security adviser Eyal Hulata met with his U.S. counterpart Jake Sullivan at the White House Tuesday to discuss the negotiations with Iran.

• One of the main goals of Hulata’s trip was to press the White House against any further concessions, mainly on the International Atomic Energy Agency investigations against Iran and the sanctions against the Islamic Revolutionary Guard Corps.
• Sullivan told Hulata that Biden is committed to ensuring Iran never acquires a nuclear weapon, the White House said in a readout of the meeting.
• Sullivan expressed Biden's "steadfast commitment to preserve and strengthen Israel’s capability to deter its enemies and to defend itself by itself against any threat or combination of threats, including from Iran and Iranian-backed proxies," the White House said.

Between the lines: Lapid’s strong public statements and Defense Minister Benny Gantz’s upcoming trip to Washington are also connected to the domestic political situation and the upcoming Israeli elections.

• The two Israeli leaders want to show they are taking a hard line and working against the nuclear deal, fearing attacks from their political rival and ardent Iran hawk Benjamin Netanyahu.

The Biden administration has urged the Palestinian Authority not to pursue a vote at the UN Security Council on gaining full UN membership, stressing it will likely veto any such move, U.S. and Palestinian sources said.

Driving the news: The Palestinian Authority announced several weeks ago it will renew its push to gain full UN membership during the upcoming UN General Assembly meeting in New York.

• Palestinian President Mahmoud Abbas wants to use this move to try to put the Israeli-Palestinian conflict back at the center of the international community’s attention and to break the current deadlock in the peace process.
• The possible UN bid is also a way for the PA and Abbas to try to win points domestically and get deliverables from the U.S. and the EU.

Behind the scenes: Several weeks ago, Palestinian Ambassador to the UN Riyad Mansour started quiet consultations in New York with Security Council members over a possible full membership bid, according to Palestinian, Israeli and U.S. sources.

• The Palestinians also discussed the issue with Biden administration officials, who raised strong reservations and said such a move won’t lead anywhere because of the veto, U.S. sources said.

Flashback: In November 2012, the Palestinians' UN status was upgraded to non-member observer state, but this was done through a vote at the UN General Assembly where no country has veto power.

• Since then, Palestinian leaders tried several times to get a vote at the UN Security Council but never garnered enough support — nine of 15 members — to even hold a vote.

What they're saying: PLO official and Palestinian Minister Hussein al-Sheikh confirmed there were talks with the Biden administration on the issue, but stressed that it is an ongoing discussion and the PA is still trying to convince countries to support it.

• A State Department spokesperson said the U.S. is committed to a two-state solution and is focused on trying to bring the Palestinians and Israelis closer together and create conditions for direct talks.
• “The only realistic path to a comprehensive and lasting peace is through direct negotiations between the parties. There are no shortcuts to Palestinian statehood outside direct negotiations with Israel," the State Department spokesperson added.

The deep political deadlock in Iraq has entered its 10th month with no solution in sight and fears there could be a violent escalation, Mustafa Alrawi, assistant editor-in-chief at The National, writes for Axios from Abu Dhabi.

Why it matters: Many are concerned the political crisis — the longest in Iraq since the 2003 U.S.-led invasion that toppled Saddam Hussein — will lead to a flare-up of armed conflict on the streets between supporters of the different parties.

• A civil war in Iraq could lead to a larger conflict in the region with neighboring countries weighing in.

State of play: Iraq held early elections in October 2021 in response to a nationwide, pro-reform protest movement that began in late 2019.

• Since the vote, a political deadlock, mainly among Shiite parties, has prevented the formation of a new government.

Last October's elections made Shiite cleric Muqtada al-Sadr's Sadrist movement the largest bloc in Parliament.

• His rivals — the Coordination Framework grouping of Shiite parties, which includes Iran-backed former Prime Minister Nouri al-Maliki — have thwarted al-Sadr’s efforts to form a coalition government with leading Sunni and Kurdish parties.
• The Framework, for example, has been able to prevent enough MPs from attending parliament to vote on forming a new government.
• Al-Sadr has ordered his own MPs to resign and blocked the Framework from nominating its own prime minister.
• Both camps, which command heavily armed militias, also organized protests in the capital Baghdad in recent weeks.

Between the lines: Iraq’s oil wealth — with foreign currency reserves expected to surge to $90 billion by the end of the year — has not translated into an improved economic situation for many Iraqis.

• Al-Sadr has capitalized on the anger and frustration felt by Iraqis, casting himself as a nationalist bulwark against foreign interests, particularly Tehran’s influence.

Driving the news: Outgoing Prime Minister Mustafa al-Kadhimi hosted a national dialogue last week that the Sadrist movement refused to take part in, though most other major groups did, as well as the UN envoy to Iraq.

• Al-Sadr has demanded the country's judiciary dissolve Parliament, but this has been rejected.
• Al-Sadr’s followers protested outside the Supreme Judiciary Council in Baghdad's Green Zone yesterday, escalating the situation.
• The council responded by closing down all courts across the country for a day. A Baghdad court has also issued arrest warrants against three Sadrist leaders for “threatening the judiciary."

What to watch: Holding early elections as a way to end the crisis was not ruled out during last week's national dialogue meeting, but it is not clear how this can happen amid the current deadlock.

The U.S. has been pressing the Israeli government to uphold a commitment it made to President Biden to ease travel delays for Palestinians across the main border crossing between the occupied West Bank and Jordan, three senior Israeli officials tell me.

Why it matters: Biden announced during his visit to the region last month that Israel had agreed to facilitate 24/7 access for Palestinians to the Allenby Bridge by Sept. 30. But senior Israeli officials expect to miss that deadline.

• The bridge is currently closed between 11:30pm and 8am Sunday to Thursday, and closes at 3:30pm on Friday and Saturday. Palestinians have had to wait many hours or even days to cross during a recent period of heavy travel.

Behind the scenes: Since Biden’s trip, U.S. Ambassador to Israel Tom Nides has been pushing the Israelis to implement the policy, and he even visited the bridge himself.

• During the visit, Nides asked representatives of the Israel Airports Authority, which manages the bridge, whether the border crossing would be ready to operate 24/7 by Sept. 30 and was surprised when the answer was no, the Israeli officials say.
• Nides and other U.S. Embassy officials contacted Transport Minister Merav Michaeli and her team and stressed that the Israeli government should make good on its commitment to Biden.
• Michaeli and her team replied that they would try, but it was unlikely to happen due to a shortage of qualified workers — and added that the Transport Ministry never committed to the Sept. 30 deadline.

What they're saying: The situation created tensions between the Transport and Defense ministries, the former blaming the latter for agreeing to the deadline and the latter blaming the former for failing to meet it.

• “The Ministry of Defense gave empty promises to the U.S. without asking us," a senior Transport official told me.
• “The minister of transportation was happy to tweet about this agreement but now nothing is ready," a senior Defense official said.
• Both ministries acknowledge that the issue has been a diplomatic embarrassment for Israel with the Biden administration.

A State Department spokesperson said the Biden administration "supports creating a more autonomous, efficient and reliable Palestinian experience of traveling abroad."

The British special envoy for Syria told Israeli officials during a visit to Jerusalem several weeks ago that the Israeli airstrike campaign against Iranian military targets is "probably the only thing that works in Syria," Israeli Foreign Ministry officials briefed on the meetings told me.

The big picture: The Israeli air force in recent years conducted hundreds of airstrikes in Syria against targets mostly connected to Iran and Hezbollah.

• Israel said the goal of the campaign was to delay and discourage Iran’s military entrenchment efforts in Syria and prevent the transfer of sophisticated weapon systems like precision rockets from Syria to Hezbollah in Lebanon.

Behind the scenes: In private discussions in Jerusalem in June, U.K. envoy Jonathan Hargreaves praised the Israeli airstrike campaign in Syria and said the U.K. and other Western countries are basing some of their policies on its results, the Israeli officials said.

• Hargreaves said that because the political process in Syria is deadlocked, Western countries could switch the focus of their diplomatic efforts to the need to end the Iranian presence there, per the Israeli officials.

A senior British diplomat told me that the embassy officials who attended the meeting do not remember Hargreaves praising the airstrikes.

State of play: In the meeting, the U.K. envoy stressed that the West has realized that outside pressure won’t lead to regime change in Syria. He added that instead of continuing their calls for the ouster of Syrian President Bashar al-Assad, they have decided to focus on trying to change the regime’s behavior, the Israeli officials said.