Tehran and Moscow can devise effective financial mechanisms to circumvent US sanctions, says a political analyst, who argues that Iran can become a major transit hub for Russian oil and gas exports to Asia.
“Iran and Russia are subject to sanctions by the United States and Europe and can get around many of the sanctions and strengthen the [Russian] ruble and the [Iranian] rial by developing banking and financial mechanisms,” Sabah Zanganeh told ISNA in remarks published on Sunday.
He was referring to the renewed US sanctions against Tehran over its nuclear program and international sanctions against Russia’s economy, including its energy sector, for its 2014 annexation of Crimea from Ukraine.
Iran and Russia are currently using their own currencies in bilateral trade but are under the influence of the dollar as crude oil and oil products are priced in the green back, according to Qadir Qiafeh, the former vice chairman of Iran-Russia Chamber of Commerce.
Energy Market
“Iran…has an important role among oil and gas exporting countries, and Russia enjoys a similar status. The two sides can and should adopt effective measures that can help serve mutual interests,” Zanganeh said.
He maintains that Iran can influence policies governing the global energy market if it cooperates with Russia in a way that its national interests are safeguarded.
“Iran and Russia can further build solidarity to advance the interests of both peoples in the face of tensions created by Trump in the energy market,” the Middle East expert said, in reference to US President Donald Trump’s recent criticism of Germany’s energy cooperation with the Russians. Trump launched a sharp public attack on Berlin last week for supporting a Baltic Sea gas pipeline deal with Moscow, saying it had become “a captive to Russia”, according to Reuters.
Transit State
Zanganeh says Iran can serve as a major transit country for Russian oil and gas exports to the Persian Gulf states and other Asian markets.
The realization of such goals requires the strong backing of both governments, he stated, adding that the recent trip to Moscow by Ali Akbar Velayati, a senior advisor to the Leader , will contribute greatly to the expansion of two-way ties.
Velayati met President Vladimir Putin on July 12, after which he said Moscow is prepared to invest $50 billion in Iran’s energy sector.
In November 2017, it was announced that Russian oil producer Rosneft and the National Iranian Oil Company had signed a deal on the implementation of “strategic” projects in Iran with total investments up to $30 billion.
Russian Market
Mohammad Nabi Habibi, secretary-general of the Islamic Coalition Party, says Tehran needs to enhance its economic and trade ties with Moscow. “Russia is a safe route for Iranian oil exports, banking transactions and economic activities. Russia’s 150-million-strong market is open to our businesses. Opportunities exist for us there,” Tasnim News Agency quoted him as saying on Sunday.
Look East Policy
Habibi said Tehran needs to readjust its policy and move closer to the East, adding that Moscow can help pave the way for Iran’s full membership of the Shanghai Cooperation Organization, a regional security and economic cooperation body led by China and Russia. “We have to keep this path open.” Iran is currently an observer member of the bloc, and both Russian and Chinese leaders have supported its call for full membership.
Velayati is expected to visit China soon.
