It's a tragicomedy, really. Washington plays The Great Pretender, faking it full-time that Israel is not a nuclear-armed power while trying to convince the whole planet Israel is entitled to amass as many weapons as it wants while Iran is not allowed to even have conventional means to defend itself. Not to mention that nuclear-armed Israel has threatened and invaded virtually all of its neighbors, while Iran has invaded nothing.
Dance to the energy balletAs harsh as they really are, sanctions did not force Tehran to kneel and submit. Khamenei has repeatedly said he's not optimistic about a nuclear deal. What he really wants, much more than a deal, is an improved economy. Now, with the sanctions cracking after the initial Geneva agreement, there is light at the end of the tunnel.
Enter turbo-charged Russia-Iran negotiations. They include a power deal worth up to $10 billion, including new thermal and hydroelectric plants and a transmission network.
And of course the oil-for-goods swap according to which Russia may buy 500,000 barrels of Iranian oil a day. Details are to be finalized in early September. No wonder Washington is fuming; this deal should propel Iran's oil exports over one million barrels a day, something that was initially agreed upon in Geneva.
With Russia now also under US and EU sanctions, predictably Tehran had to start openly courting Europe as the ideal alternative source of natural gas. I have been writing about this for years now. Europe is desperate to diversify from Gazprom. Iran has all it takes to sell gas to Europe transiting especially via Turkey. Yet there are so many political and logistical roadblocks -- starting with the necessity of a final nuclear deal -- which this is an extremely long-term scenario at best.
The energy ballet involving Iran, Russia, the EU and the US is worthy of a geopolitical neo-Stravinsky. Tehran is careful not to antagonize Moscow -- the largest supplier of natural gas to Europe. But Tehran also knows that with US-Iran possibly entering a detente, the EU will go for broke to seduce and invest in Iran.
Iranian Deputy Oil Minister for International and Trade Affairs Ali Majedi definitely has seen which way the wind is blowing. He is already talking about three different routes Tehran could use for its energy exports to the West.
According to the BP Statistical Review of World Energy, Iran's proven natural gas reserves are at a whopping 33.6 trillion cubic meters, while Russia's are at 32.9 trillion cubic meters. Talk about two powerhouses.
The problem is Iran is way behind Russia in investment and production. A few years ago, in Tehran, energy experts measured it for me at $200 billion needed to upgrade the industry and invest in domestic transport and export infrastructure.
So, realistically, Russia will remain the key gas supplier to the EU in the foreseeable future, predominating over the strategic value of Iranian and Central Asian gas. And that includes the fact that plenty of EU nations, despite non-stop political shenanigans in Brussels, support the construction of the Russia-favored South Stream pipeline.
Tehran, though, is now in the game -- already attracting a host of prospective, powerful foreign investors from Europe and Asia. A recent international oil, gas, refining and petrochemicals exhibition in Tehran attracted no less than 600 foreign companies from 32 countries.
We got it all coveredIranian Deputy Foreign Minister Majid Takht Ravanchi -- part of the nuclear negotiating team -- has been positively ecstatic lately; "Naturally Iran and Europe could have much better cooperation on the economy, trade, and energy. We believe there is much room for improvement."
But it was Iran's Deputy Oil Minister Ali Mejidi who went a colossal step further -- resuscitating the moribund Nabucco pipeline; "With Nabucco, Iran can provide Europe with gas. We are the best alternative to Russia."
Nabucco, a "Pipelineistan" saga I have followed in detail, was all about a pipeline to Europe via Turkey, Bulgaria, Romania, Hungary and Austria filled with sometimes Azerbaijani, sometimes Iraqi gas, before it spectacularly floundered for lack of investment.
Does that mean Iran is picking an energy war with Russia? Not really. Nabucco is a major, expensive "if," and extremely long-term. South Stream, although momentarily stalled, is ready to go.
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