TND Guest Contributor: Petr
Lvov
When less than a week ago Russia and
Turkey unexpectedly began normalizing their relations, experts were left
guessing what this normalization was all about. Yet, they have completely
forgotten about a very important economic factor – gas. One must note that
the United States and the European Union maintain a sanctions regime against
Russia in the gas sector, while having lifted their embargo against Iran, pitting those two states against each other in a battle
for energy markets around the world, including European markets. This has
created a rather uncomfortable situation for both countries, which shared a
mutual distrust towards each other but were forced to cooperate in order to
achieve a common goal – to push back the dictates of the US and the West as a
whole.
And then again, there were rumors of secret deals between Washington and
Tehran over the Iranian gas pipeline project that could stretch across
Iran-Iraq and Syria. One couldn’t help but note that the three-parties
memorandum on the construction of such a pipeline that was to deliver Iranian
gas to Greece was signed in Bushehr back in 2011. The pipeline with a
projected capacity of 110 million cubic meters per day was to begin
operations in 2016. The total amount of investments in this project was to
approach 10 billion dollars. However, the conflict in Syria has jeopardize
this project, although there were rumors that the Iranians had allegedly
built a 350 miles long section across its territory to carry on the
construction when the time is right. But nobody has ever seen this.
In light of the current balance of power in the region, this project seems
to be totally unrealistic. And the real problem is not the absence of any
definitive conclusion to the Syrian conflict, which obstructs the
construction of the pipeline. Iran’s regional rival, opposing this project,
is directly are directly associating this project with Tehran’s capacity to
establish a “Shia arc” which would encompass Iran, Iraq, Syria and Lebanon,
therefore Tehran’s rivals would never allow this project to become a reality.
One couldn’t help but notice that the so-called revolt in Syria began
virtually simultaneously with the signing of the memorandum on the
construction of the Iranian pipeline. Arabian monarchies immediately began
taking steps to derail this project at whatever cost. Experts note that the
Saudi-led camp despises the very idea of the Shia arc” being created, and
Turkey and Saudi Arabia and not the only ones to ring the alarm, since Israel
dislikes this idea as well.
That is why these states remain deeply
concerned with American attempts to hold negotiations with Iran behind closed
doors. The successful squeezing of the Russian Federation from European gas
markets plays a pivotal role in Washington’s policies, therefore it has been
obstructing the construction of a Russian gas pipeline across Turkey to
Greece (the so-called “Turkish Stream”). It leaves us with a fairly curious
group of interests, we have Moscow, Doha, Riyadh, Ankara, Tel Aviv on one
side, and Tehran, Washington and Brussels on the other. The problem is that
Russia cannot be an ally to Saudi Arabia or Qatar, since all of the GCC
countries depend on the United States in matters of security.
However, Russia has nothing to be worried about yet.
Despite the fact that Iran can boast the world’s largest reserves of natural
gas (18.2% of total reserves), it can not compete with Russia in the short
term for the following reasons:
- low production volumes of natural gas in Iran;
- strong domestic demand;
- a relatively small share Tehran has in the world gas
trade which amount to 1% of all contracts;
- outdated extraction technology;
- 60% of Iranian gas is located in the world’s largest
offshore field in South Pars and is difficult to extract;
- the pressure Saudi Arabia, Qatar and Israel are applying
on potential buyers of Iranian gas
At the same time, Russia and Iran have joined their forces to prevent the
implementation of the “Western” project to build a trans-Caspian gas pipeline
to the EU (Nabucco), which was supposed to provide Europe with Turkmenistan
gas via Azerbaijan and Turkey. The official reason for the stalling of the
project: “undefined legal status of the Caspian Sea.”
So Ankara, after facing a sharp deterioration of
its relations with Russia after downing a Russian SU-24 warplane
over Syria, has finally understood that it is better to become a transit
state for Russian gas than wait for the successful implementation of the
Iranian project. Moreover, the Kurds supported by the US are a step away from
capturing Al-Raqqah in northern Syria, while Sunni tribes are nearing the
Iraqi city of Mosul.
While no major change has taken place, Tehran plans to sell its gas at a
very low price in the strategic port of Chābahār in the Persian Gulf which
will likely become a part of the Chinese New Silk Road project. It has also
aimed at establishing itself as a regional leader in terms of gas supply
across the Middle East and to Asia.
Moscow, however, is reluctant to lag behind as it has already announced
that is going to increase its production
capacities of natural gas by 40% until 2035, taking its own share of Asian
markets.
Yet another blow for Iran is news that Russia plans to proceed with the
implementation of theTurkmenistan – Afghanistan – Pakistan – India (TAPI)
project, which was one of the main reasons for NATO’s occupation of
Afghanistan. This will effectively be the end for the gas pipeline running
through Iran – Pakistan – India, which would help to strengthen the
geopolitical position of Iran in the region. Russia has offered New Delhi the
resumption of construction, while Russian-Chinese companies have already
started extracting gas in the Afghan province of Sari Pul. So maybe that’s
why the United States is trying to expand the chaos it creates across the
Central Asia.
Now Tehran faces a choice: whether to treat Russia as a competitor, or as
a partner that can serve as a bulwark against Israeli and Saudi plans against
Iran.
So far one thing is clear: today, even such a gas superpower like Iran
cannot replace Russia in Europe. But Turkey could easily become a “southern
hub” of gas supplies from Russia to the EU, thus burying Ukraine as a transit
country for Russian gas, and with it the root cause of the regular extension
of the anti-Russian sanctions. There will be no Ukraine as we know it now
without the Russian gas transit, therefore there will be no motivation for
continued destabilization in Ukraine once it is circumvented. So a
partnership between Moscow and Ankara can affect the whole geopolitical
situation, including the Chinese “Silk Road”. After all, Moscow does not need
it, what it needs is the “Southern Corridor” across the Baltic Sea and the
Caspian Sea to the Indian Ocean. Moreover, Russia doesn’t need Iran as a powerful
gas player either. Apparently, Ankara has finally comprehended this fact.
