Iran in the European Gas Market: a Russian Point of View

Summary:

Behind Iranian diplomacy lies the continuing hope for an easing of tensions between America and Iran, with its consequences, which have not yet been worked out satisfactorily, both for Russian interests in the sphere of energy and from the point of view of preserving the fully-formed configuration of Eurasia’s gas market.

It is possible to talk about Iran as a potentially significant participant in the Eurasian gas market, but only with one major concession: no military development may take place in the conflict with the global community on the problem of uranium treatment. As it turns out, such a concession is entirely justified, since an increasing number of signs are appearing that the potential for military confrontation between the West and Iran on nuclear issues is decreasing.

Western participants of Iran Six hope to convince Moscow and Beijing to introduce new sanctions against Tehran, such as restrictions for Iran sales of gas and oil and refined products import. This directly affects the interests of Russia and China, which do not follow the restrictions of the American “Iran and Libya Sanctions Act” of 2006 concerning Iran which has been extended for a further 5 years. It allows for sanctions in relation to foreign companies investing more than $20 million per year in the energy sector in these countries. The “Iran Freedom and Support Act” passed not long ago also strengthens the extent of the sanctions, having extended them not only to foreign oil companies but also to “private and state” creditors, underwriters and financial backers taking part in oil projects in Iran.

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