Today, the French gas and oil company Total has announced the finalisation of a $4.8 billion deal with Iran to cultivate and develop the South Pars gas field in the Persian Gulf.
This is the first major foreign investment in Iran’s lucrative energy market since the so-called ‘Iran deal’ went into effect, a deal which the EU has just confirmed is still being fully observed by the Iranian government.
Total’s Chief Executive Patrick Pouyanne has spoken optimistically about the gas deal in spite of the risks inherent in a deal that the US could potentially quash the deal due to its prolonged disputes with Iran.
This comes as Qatar’s Foreign Minister Sheikh Mohammed bin Abdulrahman al-Thani once again affirmed that Qatar has no interest in complying with the ridiculous Saudi authored ultimatum which if obeyed would see Saudi, the UAE, Bahrain and Egypt begin to restore normal relations with Doha.
Sheikh Mohammed bin Abdulrahman al-Thani stated,
“We believe that the world is governed by international laws, that don’t allow big countries to bully small countries. No one has the right to issue to a sovereign country an ultimatum”.
“There is no fear from whatever action would be taken; Qatar is prepared to face whatever consequence. But as I have mentioned… there is an international law that should not be violated and there is a border that should not be crossed”.
Qatar’s continued statements of defiance against what does in fact amount to Saudi bullying and the finalisation of the deal between Iran and Total are almost certainly not coincidental.
Qatar sits upon the same South Pars oil field in the Persian Gulf as does Iran. The primary reason for Saudi Arabia’s dispute with Qatar were statements attributed to Qatar’s Emir Tamim bin Hamad Al Thani in which he spoke positively of Doha’s warming relationship with Tehran.
Of course the warming relationship between Qatar and Iran is not about ideology and never was. Qatar is always going to be a Salafist monarchy (some would say kleptocracy) while Iran will always be a Shi’a Islamic Republic. The real worry for Saudi is over economics. With the demand for and consequently price of Saudi oil falling, if Qatar and Iran were to mutually cultivate the South Pars natural gas field, this could be a new energy monolith in the region which could further cut into the energy market shares of Saudi Arabia’s state-owned energy company Aramco.
With Qatar clearly ready to be cut off from Saudi Arabia and the UAE for the foreseeable short or even medium term future, it is looking increasingly possible that circumstance might push Qatar directly into Iran’s arms, especially now that the French company Total is about to begin its new gas project in Iran.
As a long term political ally of western states including the US and France, Qatar may in fact hold the key to bridging the economic divide between Iran and economies who do copious amounts of business with the west.
This is the clearest commercial indication yet that Saudi’s attempt to isolate Qatar and Iran from each other and from the wider world has failed miserable.