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Donald Trump ‘decertifies’ Iran; US foreign policy becomes irrational

‘Decertifying’ Iran despite its compliance with JCPOA is further example of a US foreign policy which is becoming ever more erratic and which has lost touch with reality

Alexander Mercouris

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“Whom the gods would destroy they first make mad”.

The above quote – often misattributed to Euripides – came to me irresistibly as I listened to Donald Trump’s speech on Iran, the complete text of which can be found here.

Suffice to say that in many years of following US Presidential addresses (some of them very weird) I have never heard or read any other speech from a US President on an important foreign policy issue which was so completely detached from reality or so frankly bizarre (the only one which comes close is George W. Bush’s address given on the eve of his invasion of Iraq).

I do not propose to analyse the speech in any detail since this has already been done thoroughly and excellently by my colleague Adam Garrie.

I would however draw attention to three particular statements in Donald Trump’s speech which seemed to me especially surreaI

“Iran is under the control of a fanatical regime that seized power in 1979 and forced a proud people to submit to its extremist rule.”

(bold italics added)

Opinions on the Iranian Revolution of 1979 differ but I do not know a single person well-informed about recent Iranian history who would recognise this description of it.

The reality – as I remember very well, having observed the Iranian Revolution closely when it was actually happening – is that in 1979 support for the Shah of Iran – a dictator of doubtful legitimacy, whose father was a Persian Cossack officer who became Iran’s Shah as a result of a coup, and who was himself installed by the US as Iran’s ruler following a CIA organised coup which overthrew Iran’s democratically elected government – had completely collapsed, so that Iranian society was almost completely united against him.

Far from Iran’s Islamic republic having been “forced on a proud people” by a faction that “seized power” – Trump presumably means illegally – it was what the overwhelming majority of people in Iran in 1979 wanted, and what they had gone onto the streets in their millions – risking death in confrontations with the Shah’s soldiers – to demand.

The idea that Iran’s current system of government lacks legitimacy is a fundamental error – shared by many people in the US and the West, not just by Donald Trump – which completely misunderstands its origins as well as recent Iranian history and contemporary Iranian society.

Unfortunately, it is an error which leads directly to the second of Donald Trump’s statements which I found surreal

…….the previous administration lifted these sanctions, just before what would have been the total collapse of the Iranian regime, through the deeply controversial 2015 nuclear deal with Iran. This deal is known as the Joint Comprehensive Plan of Action, or JCPOA……The nuclear deal threw Iran’s dictatorship a political and economic lifeline, providing urgently needed relief from the intense domestic pressure the sanctions had created.

(bold italics added)

I do not know a single credible analyst who believes that in 2015 – on the eve of the JCPOA being signed – the ‘Iranian regime’ was on the brink of total collapse.  On the contrary the situation in Iran was then – as it is now – politically stable, with the country holding in an orderly and peaceful way a contested Presidential election just two years before.

As for the sanctions, though they were undoubtedly the cause of real hardship, the evidence suggests that it was the US who the Iranian people blamed for them rather than their own government.

The idea that in 2015 Iran’s Islamic republic – which had by then endured years of US hostility and a terrible war with Saddam Hussein’s Iraq – was on the brink of collapse is a fantasy.

I would add that it is not merely a fantasy. It is actually the reverse of the truth.  Far from “throwing a collapsing regime a lifeline” the reason the Obama administration very grudgingly agreed to the JCPOA was because international support for the sanctions regime against Iran was collapsing, with the US intelligence community continuing to report since 2007 that Iran was not working towards a nuclear weapons capability, with the Russians on the brink of agreeing  a massive ‘goods-for-oil’ barter deal with Iran, and – most importantly – with the US’s own European allies becoming increasingly disenchanted with the sanctions policy, and hinting that they might pull out of it.

All of this was made crystal clear in August 2015 by Obama’s Secretary of State John Kerry in a highly revealing interview he gave to Reuters where he said this about why the US agreed to the JCPOA,

But if everybody thinks, “Oh, no, we’re just tough; the United States of America, we have our secondary sanctions; we can force people to do what we want.” I actually heard that argument on television this morning. I’ve heard it from a number of the organisations that are working that are opposed to this agreement. They’re spreading the word, “America is strong enough, our banks are tough enough; we can just bring the hammer down and force our friends to do what we want them to.”

Well, look – a lot of business people in this room. Are you kidding me? The United States is going to start sanctioning our allies and their banks and their businesses because we walked away from a deal and we’re going to force them to do what we want them to do even though they agreed to the deal we came to? Are you kidding?

That is a recipe quickly, my friends, for them to walk away from Ukraine, where they are already very dicey and ready to say, “Well, we’ve done our bit.” They were ready in many cases to say, “Well, we’re the ones paying the price for your sanctions.” We – it was Obama who went out and actually put together a sanctions regime that had an impact. By – I went to China. We persuaded China, “Don’t buy more oil.” We persuaded India and other countries to step back.

Can you imagine trying to sanction them after persuading them to put in phased sanctions to bring Iran to the negotiating table, and when they have not only come to the table but they made a deal, we turn around and nix the deal and then tell them you’re going to have to obey our rules on the sanctions anyway? 

That is a recipe very quickly, my friends, businesspeople here, for the American dollar to cease to be the reserve currency of the world – which is already bubbling out there…..

(bold italics added)

In other words the US was pushed into the JCPOA somewhat against its will at the insistence of its European allies, who were considering lifting sanctions on Iran unilaterally if the US rejected the deal which was on offer.  The US submitted to their demands because it feared that the alternative – threatening economic war on its European allies by imposing sanctions on them – would have hastened the ending of the reserve currency status of the US dollar.

It is rare to say the least for US officials to contemplate in public the possibility of the US dollar losing its reserve currency status.  The fact that in August 2015 Secretary of State Kerry actually did so shows the pressure that the US was under.

In other words far from the Iranian ‘regime’ being on the brink of collapse, in 2015 it was the sanctions regime imposed on Iran which was about to collapse, which was why the US grudgingly agreed to the deal.

Many people including my colleague Adam Garrie have pointed to the absurdity of the third of the statements Donald Trump made in his speech – the one about Iran’s alleged support for terrorism – which seemed bizarre to me.  I need therefore say little about it.

The regime remains the world’s leading state sponsor of terrorism, and provides assistance to al Qaeda, the Taliban, Hezbollah, Hamas, and other terrorist networks.

(bold italics added)

Suffice to say that Al-Qaeda is a militant sectarian Sunni Salafi terrorist organisation deeply antithetical to Shia Iran.  From time to time Al-Qaeda’s central leadership (“Al-Qaeda Central”) has for tactical reasons attempted to rein in the pathological anti-Shia sectarianism of its followers.  Whenever it has done so it has however failed.  In Iraq its fighters – grouped in the organisation originally called “Al-Qaeda in Iraq” and originally led by the psychotic anti-Shia sectarian Abu Musab Al-Zarqawi – eventually morphed into ISIS, whose attitude to Iran and the Shia can be described as frankly genocidal.  In Syria Al-Qaeda’s fighters under the various names they have used (Jabhat Al-Nusra being the most famous) have also been pathologically murderous anti-Shia sectarians.

The idea that Iran could in any way support or patronise such an organisation is simply preposterous, and the fact that a number of Al-Qaeda operatives may – as Donald Trump claims – have following 9/11 passed through Iran does not (if it is even true) change that fact.

As for the Taliban, in 1998 – following the murder by the Taliban of 11 Iranian diplomats and journalists in the northern Afghan town of Mazar-i-Sharif – Iran and the Taliban almost went to war, with Iran mobilising 70,000 troops on its border with Afghanistan in preparation for an attack on the Taliban until concessions to Iran by the Taliban and UN mediation caused the crisis to be defused.

Subsequently, during the US invasion of Afghanistan in 2001, Iran cooperated with the US to defeat the Taliban, with US and Iranian Special Forces even working together to liberate the important Afghan city of Herat from them.

To suggest therefore that Iran and the Taliban – also incidentally a sectarian Sunni organisation, though not an international terrorist organisation like Al-Qaeda – are in alliance with each other is quite simply preposterous.

These three absurd statements in Donald Trump’s speech are in fact only the most absurd in a speech filled with absurdity.  What for example is one to make of this comment about the notional connections between Iran and North Korea?

There are also many people who believe that Iran is dealing with North Korea. I am going to instruct our intelligence agencies to do a thorough analysis and report back their findings beyond what they have already reviewed.

(bold italics added)

What is this if not an admission that the US does not actually possess any knowledge that Iran is in fact dealing with North Korea?  If the US does not have any knowledge that Iran is dealing with North Korea why is this comment even in Donald Trump’s speech?

What makes this statement especially bizarre is that though the US has no knowledge that Iran is dealing with North Korea, it does have knowledge – or at least information – that its ally Ukraine is.

I discussed all this at length in an article I wrote for The Duran on 20th August 2017.  Subsequently, I noticed this comment on this same subject in an article on the North Korean nuclear weapon and ballistic missile programme published by the Guardian on 11th September 2017

There is a growing consensus that former Soviet missile engines acquired on the black market in Ukraine have enabled Kim’s scientists to take the strides seen this year.

(bold italics added)

Why does Donald Trump not order US intelligence to investigate the dealings between North Korea and Ukraine about which a “growing consensus” exists, instead of wasting their time by ordering them to investigate dealings between North Korea and Iran about which the US has no knowledge?

The central absurdity of the whole speech is however that Donald Trump is unable to point to any single major breach by Iran of the JCPOA such as would justify his decision to decertify it.   The various breaches he does refer to – all denied by Iran – are minor.

In other words Trump is decertifying Iran and encouraging Congress to punish it notwithstanding that Iran is in compliance with the deal it made with the US, and is doing nothing wrong other than conduct in the Middle East a foreign policy the US doesn’t like.

As to that, the fact that the US and Iran are at the present time adversaries in the Middle East is a fact of life, a reality which any responsible statesman would accept and work around.

Many states at many times in history have found themselves in adversarial relationships with each other.  Acting to tear up a critical international agreement which is being successfully implemented and is working simply because two states don’t get on with each other is not an act of statesmanship or a master-stroke of policy.  It is an act of childish petulance, a teenage tantrum, unworthy of a country which still likes to think of itself as the world’s foremost Great Power.

Unfortunately this pattern of behaviour goes far beyond Donald Trump.  Thus over the course of the last year the whole foreign policy of the US has been held hostage to a concocted scandal based on a farfetched conspiracy theory which any reasonable person can see is preposterous.  Matters have reached the point where it is now being suggested – apparently in all seriousness – that this conspiracy involved ‘weaponising’ Pokemon Go.

Moreover in December the US imposed sanctions on Russia purportedly because of this scandal.  Then – despite Russia having done nothing more that would justify more sanctions – in August the US imposed more sanctions on Russia for the same reason, all over again.

In relation to the crisis over North Korea’s nuclear weapons and ballistic missile programme the US has reneged on agreements it previously made with North Korea, cannot decide whether it wants to talk with North Korea or not, and piles on sanctions against North Korea, despite two decades of evidence that this only makes the North Koreans more determined to press ahead with their nuclear weapons and ballistic missile programme, as the Chinese and the Russians repeatedly point out to them.

In relation to the so-called “War on Terror”, the US purports to fight Al-Qaeda in Afghanistan and Pakistan, but has been de facto in alliance with Al-Qaeda in Libya, Syria and Yemen.

In Iraq, Egypt, Libya and Syria the US has worked to undermine and overthrow secular governments which were the region’s major bulwark against the very Jihadi terrorism which the US says it opposes.

This increasingly erratic behaviour has now reached a new level with this latest speech of Donald Trump’s.

Like most people I believe that the immediate damage done by this speech is limited.  Though I am sure that the US Congress will impose further sanctions on Iran – I cannot think of a single case where Congress has been invited to impose sanctions on another country and has failed to do so – I believe that international support for the JCPOA is too strong, and Iran is too sensible, to cause it to unravel.

Like most people I also believe that the very same US Deep State which has made Donald Trump’s life miserable in relation to Russia, will now act as a restraint on him.  Apparently it was the cabal of generals who now all but run the US government – Mattis, McMaster and Kelly, along with General Dunford, the Chairman of the Joint Chiefs of Staff – who along with Secretary of State Tillerson managed to talk Trump out of pulling out of the JCPOA completely as he apparently wanted to do.

This was not because they have any love of Iran or of the JCPOA.  Rather it was because they were acting in the classic tradition of the US military: always willing to attack without hesitation a state which is unable to resist or hit back; but balking at attacking states like Russia, North Korea or Iran, which not only can hit back, but which are able to put up a determined resistance if they are attacked.

The damage done by Trump’s speech is not to Iran or (probably) to the JCPOA.  It is to the international perception of the US, which is conducting itself ever more irrationally, so that one administration sets out to undermine an agreement reached by a previous administration, even when doing so is contrary to US interests, so that no one can put any trust in the US’s word any more.

After the huge damage done to the US’s international reputation by George W. Bush’s incompetence and belligerence and by Barack Obama’s arrogance and narrow-mindedness, many governments around the world welcomed the new Trump administration which came with – apparently – fresh ideas, and – seemingly – a willingness to turn a new leaf in international relations.

At a blistering pace they are all becoming increasingly disillusioned as they face the reality of another disastrous US Presidency, functioning against a backdrop of a US political system which has been exposed as hopelessly dysfunctional and increasingly irrational, offering no promise of things ever getting better at any time in the future.

Truly in the lunatic asylum, which is what the once great American Republic has become, the inmates have taken over.

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Republicans call Justice Department’s Bruce Ohr to testify, but where is British Spy Steele? (Video)

The Duran – News in Review – Episode 78.

Alex Christoforou

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Representative Mark Meadows tweeted Friday…

“DOJ official Bruce Ohr will come before Congress on August 28 to answer why he had 60+ contacts with dossier author Chris Steele, as far back as January 2016. He owes the American public the full truth.”

Lawmakers believe former Associate Deputy Attorney General Bruce Ohr is a central figure to finding out how the Hillary Clinton campaign and the Democratic National Committee paid PR smear firm Fusion GPS and British spy Christopher Steele to fuel a conspiracy of Trump campaign collusion with Russians at the top levels of the Justice Department and the FBI.

House Intelligence Committee Chairman Devin Nunes (R-CA) said Sunday to Fox News’ Maria Bartiromo…

So here you have information flowing from the Clinton campaign from the Russians, likely — I believe was handed directly from Russian propaganda arms to the Clinton campaign, fed into the top levels of the FBI and Department of Justice to open up a counter-intelligence investigation into a political campaign that has now polluted nearly every top official at the DOJ and FBI over the course of the last couple years. It is absolutely amazing,

According to Breitbart, during the 2016 election, Ohr served as associate deputy attorney general, and as an assistant to former Deputy Attorney General Sally Yates and to then-Deputy Attorney General Rod Rosenstein. His office was four doors down from Rosenstein on the fourth floor. He was also dual-hatted as the director of the DOJ’s Organized Crime Drug Enforcement Task Force.

Ohr’s contacts with Steele, an ex-British spy, are said to date back more than a decade. Steele is a former FBI informant who had helped the FBI prosecute corruption by FIFA officials. But it is Ohr and Steele’s communications in 2016 that lawmakers are most interested in.

Emails handed over to Congress by the Justice Department show that Ohr, Steele, and Simpson communicated throughout 2016, as Steele and Simpson were being paid by the Clinton campaign and the DNC to dig up dirt on Trump.

The Duran’s Alex Christoforou and Editor-in-Chief Alexander Mercouris examine the role Bruce Ohr played in Hillary Clinton’s Deep State attack against the Presidency of Donald Trump, and why the most central of figures in the Trump-Russia collusion hoax, British spy for hire Christopher Steele, is not sitting before Congress, testifying to the real election collusion between the UK, the Obama White House, the FBI and the DOJ.

Remember to Please Subscribe to The Duran’s YouTube Channel.

Via The Washington Times

Republicans in a joint session of House committees are set to interview former Associate Deputy Attorney General Bruce Ohr this month to gauge whether a complex conspiracy against Donald Trump existed among Hillary Clinton loyalists and the Justice Department.

“DOJ official Bruce Ohr will come before Congress on August 28 to answer why he had 60+contacts with dossier author Chris Steele as far back as January 2016. He owes the American public the full truth,” tweeted Rep. Mark Meadows, North Carolina Republican and member of the House Oversight and Government Reform Committee.

His panel and the House Judiciary Committee plan to hold a joint hearing to interview Mr. Ohr, according to The Daily Caller.

FBI documents show that the bureau bluntly told dossier writer Christopher Steele in November 2016 that it no longer wanted to hear about his collection of accusations against Mr. Trump.

But for months afterward, the FBI appeared to violate its own edict as agents continued to receive the former British spy’s scandalous charges centered on supposed TrumpRussia collusion.

 

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The US-Turkey Crisis: The NATO Alliance Forged in 1949 Is Today Largely Irrelevant

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Authored by Philip Giraldi via American Herald Tribune:


There has been some reporting in the United States mass media about the deteriorating relationship between Washington and Ankara and what it might mean. Such a falling out between NATO members has not been seen since France left the alliance in 1966 and observers note that the hostility emanating from both sides suggests that far worse is to come as neither party appears prepared to moderate its current position while diplomatic exchanges have been half-hearted and designed to lead nowhere.

The immediate cause of the breakdown is ostensibly President Donald Trump’s demand that an American Protestant minister who has lived in Turkey for twenty-three years be released from detention. Andrew Brunson was arrested 21 months ago and charged with being a supporter of the alleged conspiracy behind the military coup in 2016 that sought to kill or replace President Recep Tayyip Erdogan.

Erdogan has asserted that the coup was directed by former political associate Fetullah Gulen, who lives in exile in Pennsylvania, but has produced little credible evidence to support that claim. In the aftermath of the coup attempt, Erdogan has had himself voted extraordinary special powers to maintain public order and has arrested 160,000 people, including 20 Americans, who have been imprisoned. More than 170,000 civil servants, teachers, and military personnel have lost their jobs, the judiciary has been hobbled, and senior army officers have been replaced by loyalists.

Gulen is a religious leader who claims to promote a moderate brand of Islam that is compatible with western values. His power base consists of a large number of private schools that educate according to his curriculum, with particular emphasis on math and sciences. Many of the graduates become part of a loose affiliation that has sometimes been described as a cult. Gulen also owns and operates a number of media outlets, all of which have now been shut by Erdogan as part of his clamp down on the press. Turkey currently imprisons more journalists than any other country.

It is widely believed that Erdogan has been offering to release Brunson in exchange for Gulen, but President Donald Trump has instead offered only a Turkish banker currently in a U.S. prison while also turning the heat up in the belief that pressure on Turkey will force it to yield. Washington began the tit-for-tat by imposing sanctions on two cabinet-level officials in Erdogan’s government: Interior Minister Suleyman Soylu and Justice Minister Abdulhamit Gul. Ankara has now also been on the receiving end of a Trump tweet and tariffs have been placed on a broad range of Turkish products, to include steel and aluminum.

The view that economic pressure will force the Turks to yield could be mistaken and demonstrates that the Administration does not include anyone who knows that Americans have been unpopular in Turkey since the Gulf War. The threats from Washington might actually rally skeptical and normally pro-western Turks around Erdogan but U.S. sanctions have already hit the Turkish economy hard, with the lira having lost 40% of its value this year and continuing to sink rapidly. Foreign investors, who fueled much of Turkey’s recent economic growth, have fled the market, suggesting that a collapse in credit might be on the way. Those European banks that hold Turkish debt are fearing a possible default.

It is a spectacle of one NATO member driving another NATO member’s economy into the ground over a political dispute. Erdogan has responded in his autocratic fashion by condemning “interest rates” and calling for an “economic war” against the U.S., telling his supporters to unload all their liquid valuables, gold and foreign to buy the plummeting lira, a certain recipe for disaster. If they do that, they will likely lose everything.

Other contentious issues involved in the badly damaged bilateral relationship are conflicting views on what to do about Syria, where the Turks have a legitimate interest due to potential Kurdish terrorism and are seeking a buffer zone, as well as Ankara’s interest in buying Russian air defense missile systems, which has prompted the U.S. to suspend sales of the new F-35 fighter. The Turks have also indicated that they have no interest in enforcing the sanctions on Iran that were re-imposed last week and they will continue to buy Iranian oil after the November 4th initiation of a U.S. ban on such purchases. The Trump Administration has warned that it will sanction any country that refuses to comply, setting the stage for a massive confrontation between Washington and Ankara involving the Turkish Central Bank.

In terms of U.S. interests, Turkey, which has the second largest army in NATO, is of strategic value because it is Muslim, countering arguments that the alliance is some kind of Christian club working to suppress Islam in the Middle East. And it is also important because of its geographic location close to hot spots where the American military is currently engaged. If the U.S. heeds Trump’s call to cut back on involvement in the region, Turkey will become less valuable, but currently, access to the Incirlik Airbase, near Adana and the Syrian border, is vital.

Indeed, Incirlik has become one of the flashpoints in the argument with Washington. Last week, a group of lawyers connected politically to Erdogan initiated legal action against U.S. officers at Incirlik over claimed ties to “terrorists” linked to Gulen. The “Association for Social Justice and Aid” has called for a temporary halt to all operations at the base to permit a search for evidence. The attorneys are asking for the detention of seven named American Colonels and Lieutenant Colonels. General Joseph Votel, head of U.S. Central Command based in Germany is also cited. If the lawyers are successful in court, it will mean a major conflict as Washington asserts the rights of the officers under the Status of Forces Agreement, while Turkey will no doubt insist that the Americans are criminals and have no protection.

Another trial balloon being floated by Erdogan is even more frightening in terms of the demons that it could be unleashing. Abdurrahman Dilipak, an Islamist columnist writing in the pro-government newspaper Yeni Atik, has suggested that there might well be a second terrorist attack on the United States like 9/11. Dilipak threatened that if Trump does nothing to reduce tension “…some people will teach him [to do] that. It must be seen that if internal tensions with the United States continue like this that a September 11 is no unlikely possibility.” Dilipak also warned that presumed Gulenist “U.S. collaborators” inside Turkey would be severely punished if they dared to go out into the streets to protest in support of Washington.

If recent developments in Turkey deteriorate further it might well suggest that Donald Trump’s instinct to disengage from the Middle East was the right call, though it could equally be seen as a rejection of the tactic being employed, i.e. using heavy-handed sanctions and tariffs to compel obedience from governments disinclined to follow Washington’s leadership. Either way, the Turkish-American relationship is in trouble and increasingly a liability for both sides, yet another indication that the NATO alliance forged in 1949 against the Soviet Union is today largely irrelevant.

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Is This The Most Important Geopolitical Deal Of 2018?

After more than 20 years of fraught diplomatic efforts, the five littoral Caspian nations agreed upon a legal framework for sharing the world’s largest inland body of water.

The Duran

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Authored by Olgu Okumus via Oilprice.com:


The two-decade-long dispute on the statute of the Caspian Sea, the world largest water reserve, came to an end last Sunday when five littoral states (Russia, Iran, Turkmenistan, Kazakhstan and Azerbaijan) agreed to give it a special legal status – it is now neither a sea, nor a lake. Before the final agreement became public, the BBC wrote that all littoral states will have the freedom of access beyond their territorial waters, but natural resources will be divided up. Russia, for its part, has guaranteed a military presence in the entire basin and won’t accept any NATO forces in the Caspian.

Russian energy companies can explore the Caspian’s 50 billion barrels of oil and its 8.4 trillion cubic meters of natural gas reserves, Turkmenistan can finally start considering linking its gas to the Turkish-Azeri joint project TANAP through a trans-Caspian pipeline, while Iran has gained increased energy supplies for its largest cities in the north of the country (Tehran, Tabriz, and Mashhad) – however, Iran has also put itself under the shadow of Russian ships. This controversy makes one wonder to what degree U.S. sanctions made Iran vulnerable enough to accept what it has always avoided – and how much these U.S. sanctions actually served NATO’s interests.

If the seabed, rich in oil and gas, is divided this means more wealth and energy for the region. From 1970 until the dissolution of the Soviet Union (USSR) in 1991, the Caspian Sea was divided into subsectors for Azerbaijan, Russia, Kazakhstan and Turkmenistan – all constituent republics of the USSR. The division was implemented on the basis of the internationally-accepted median line.

After the dissolution of the Soviet Union, the new order required new regulations. The question was over whether the Caspian was a sea or a lake? If it was treated as a sea, then it would have to be covered by international maritime law, namely the United Nations Law of the Sea. But if it is defined as a lake, then it could be divided equally between all five countries. The so-called “lake or sea” dispute revolved over the sovereignty of states, but also touched on some key global issues – exploiting oil and gas reserves in the Caspian Basin, freedom of access, the right to build beyond territorial waters, access to fishing and (last but not least) managing maritime pollution.

The IEA concluded in World Energy Outlook (WEO) 2017 that offshore energy has a promising future. More than a quarter of today’s oil and gas supply is produced offshore, and integrated offshore thinking will extend this beyond traditional sources onwards to renewables and more. Caspian offshore hydrocarbon reserves are around 50 billion barrels of oil equivalent (equivalent to one third of Iraq’s total oil reserves) and 8.4 trillion cubic meters of gas (almost equivalent to the U.S.’ entire proven gas reserves). As if these quantities were not themselves enough to rebalance Eurasian energy demand equations, the agreement will also allow Turkmenistan to build the Trans-Caspian pipeline, connecting Turkmenistan’s resources to the Azeri-Turkish joint project TANAP, and onwards to Europe – this could easily become a counter-balance factor to the growing LNG business in Europe.

Even though we still don’t have firm and total details on the agreement, Iran seems to have gained much less than its neighbors, as it has shortest border on the Caspian. From an energy perspective, Iran would be a natural market for the Caspian basin’s oil and gas, as Iran’s major cities (Tehran, Tabriz, and Mashhad) are closer to the Caspian than they are to Iran’s major oil and gas fields. Purchasing energy from the Caspian would also allow Iran to export more of its own oil and gas, making the country a transit route from the Caspian basin to world markets. For instance, for Turkmenistan (who would like to sell gas to Pakistan) Iran provides a convenient geography. Iran could earn fees for swap arrangements or for providing a transit route and justify its trade with Turkey and Turkmenistan as the swap deal is allowed under the Iran-Libya Sanctions Act (ILSA, or the D’Amato Act).

If the surface water will be in common usage, all littoral states will have access beyond their territorial waters. In practical terms, this represents an increasingly engaged Russian presence in the Basin. It also reduces any room for a NATO presence, as it seems to be understood that only the five littoral states will have a right to military presence in the Caspian. Considering the fact that Russia has already used its warships in the Caspian to launch missile attacks on targets within Syria, this increased Russian presence could potentially turn into a security threat for Iran.

Many questions can now be asked on what Tehran might have received in the swap but one piece of evidence for what might have pushed Iran into agreement in its vulnerable position in the face of increased U.S. sanctions. Given that the result of those sanctions seems to be Iran agreeing to a Caspian deal that allows Russia to place warships on its borders, remove NATO from the Caspian basin equation, and increase non-Western based energy supplies (themselves either directly or indirectly within Russia’s sphere of geopolitical influence) it makes one wonder whose interests those sanctions actually served?

By Olgu Okumus for Oilprice.com

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