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Oil Product Demand Growth In Asia Crashes

Oil Product Demand Growth In Asia Crashes

Asia, one of the drivers…

What Iran’s Election Result Means For Oil Markets

What Iran’s Election Result Means For Oil Markets

Hardliners have won the Parliamentary…

Iran Focused On Moscow, Not Washington, After Nuclear Deal

Iran Focused On Moscow, Not Washington, After Nuclear Deal

Both Russia and the United States sat on the same side of the table during negotiations with Iran over its nuclear program, but now that a deal has been reached, Tehran seems to be warming to Moscow while keeping Washington at arm’s length.

Probably the best example of the continued sour relations between Iran and the United States is that at least three men with U.S. links have been arrested in Iran since the nuclear deal was struck on July 14.

Iranian-born U.S. citizen Siamak Namazi, an oil executive based in Dubai, was arrested a month ago as he was visiting relatives in Tehran. And Nizar, a Lebanese citizen with permanent U.S. residence status, disappeared a month earlier in Tehran where he was to attend an Internet-freedom conference.

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Namazi, Nizar and Jason Rezaian, a reporter for The Washington Post, who was arrested in July 2014 and convicted last month, were all accused of spying on behalf of the United States. Their arrests appear to be the work not of moderate Iranian President Hassan Rouhani but of Iran’s hard-line Revolutionary Guard, who have opposed any deal with the West over its nuclear program.

President Obama has touted such a deal not only as a way to prevent Iran from developing nuclear weapons, but also a step toward opening Iran to greater involvement in the world community, as his predecessor, Richard Nixon, did in his historic visit to Beijing in 1972 when China was isolated and hostile to the West.

And while Iran’s supreme leader, Ayatollah Ali Khameini, has formally approved the agreement, he has also made it clear that the United States should not view the agreement as carte blanche for its companies to begin striking business deals with their Iranian counterparts, a move that they evidently fear will bring the kind of social change that could weaken conservatives’ grip on Iranian citizens.

Related: A Bit Of Good News For The Global Coal Industry At Last

Russia, however, seems to be another story. The Iranian government has invited President Vladimir Putin to visit Tehran on Nov. 23 for a summit of gas-exporting countries. The visit, confirmed by presidential aide Yuri Ushakov, will be Putin’s first to Iran since 2007. Iran is holding the forum to prepare for the expected lifting of sanctions in early 2016 because of the nuclear deal.

The invitation to Putin, extended by Rouhani, is part of a trend of warming relations between the two countries. Another element is Moscow’s consideration of two loans to the Iranian government worth a total of $7 billion. And the Russian newspaper Kommersant reports that Russia plans to go ahead with a program to equip Iran with modern air-defense missiles.

Further, Moscow has called for Iran to be represented in the multinational negotiations on dealing with the conflict in Syria. Russia supports Syrian President Bashar al-Assad, if only as a known quantity in the war-ravaged country. Iran, which is predominantly made up of Shi’a Muslims, also supports him because he represents the Alawite branch of Shi’a.

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Most Western leaders want al-Assad to resign the presidency, saying he brutally repressed his people for demonstrating their desire for more a representative government in the spring of 2011.

As Moscow and Tehran exchange favors, there is little back-and-forth between the United States and Iran, and that may explain the Islamic Republic’s warming ties with Russia. It is unlikely that Obama or his successor after the 2016 U.S. presidential election could come close to matching Moscow’s friendly gestures to Tehran, given the opposition in Congress to any accommodation with Iran.

As a result, it appears that any U.S. leader who may wish to improve relations with Iran can only hope for progress, as taking active steps toward an entente appears to be out of the question.

By Andy Tully of Oilprice.com

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  • Lee James on November 17 2015 said:
    I see Iran and Russia as two peas in a thoroughly authoritarian pod. All of the thoroughly authoritarian regimes that I know have a designated enemy squarely in their sights. We're it -- the designated enemy -- for Russia and Iran.

    The interesting thing here is that Russia and Iran need to sell their petroleum to the devils. We, the The Great Satan, will do best for ourselves and the world if we do not support ideological petroleum consumption.

    In fact, we will be wise devils if we ramp up our efforts to generally consume less fossil fuel, and grow clean energy close to home.

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