Iran Expects First Batch of Russian Vaccine This Week

Iran's ambassador to Russia said Saturday that Tehran expects to receive the first batch of Moscow's Sputnik V coronavirus vaccine by February 4, state news agency IRNA reported.

The news comes just days after Iran's Foreign Minister Mohammad Javad Zarif announced the vaccine had been approved by the Islamic Republic.

"A contract for the purchase and joint production was signed yesterday between Iran and Russia," envoy Kazem Jalali said, quoted by IRNA.

Two more batches are to be delivered by February 18 and 28, he added, without specifying quantities.

Iran's supreme leader Ayatollah Ali Khamenei earlier this month banned the use of vaccines made by the United States and Britain, calling them "completely untrustworthy".

Iran is fighting the Middle East's deadliest outbreak of COVID-19 with more than 57,800 dead out of over 1.4 million cases.

The country says arch enemy US has blocked its access to vaccines through Washington's tough sanctions regime.

While food and medicine are technically exempt, international banks tend to refuse transactions involving Iran.

Russia registered the jab—named after the Soviet-era satellite—in August last year, before the start of large-scale clinical trials, leaving some experts wary.

Sputnik V's developers have since said the vaccine is more than 90 percent effective and several countries outside of Russia have begun administering it, including Argentina.

Hungary has also said it has reached a deal to buy the vaccine, although it has not been approved by the European Union.

Iran started clinical trials of its own vaccine in late December.

Photo: IRNA

Russia Says Biden Must Lift Sanctions to Save Iran Nuclear Deal

By Jonathan Brown

Russia said Tuesday it was up to Washington to take the first steps if US President Joe Biden wants to salvage the landmark Iran nuclear deal.

Foreign Minister Sergei Lavrov urged Washington to lift sanctions on Tehran and save the historic agreement during his first talks with his Iranian counterpart since Biden's election victory raised hopes for the fate of the deal.

Lavrov said that Russia and Iran "share the same position" on the preservation of the 2015 accord, urging the United States to lift sanctions as a condition for Iran's return to compliance

"This in turn will provide the preconditions for the implementation of all requirements of the nuclear deal by the Islamic Republic of Iran," he told journalists.

The talks in Moscow came days after Iranian Foreign Minister Mohammad Javad Zarif urged the United States to make the "fundamental choice" to end its sanctions regime and reverse the "failed policies" of the previous White House administration, which took a hawkish position on Tehran.

He cautioned that any efforts by Washington to extract additional concessions would ultimately end in failure.

"Iran wants the nuclear deal it made," Zarif wrote in an op-ed in the US foreign policy magazine Foreign Affairs last week.

He reiterated Iran's position while in the Russian capital Tuesday, saying that if Washington cancels its penalties on Tehran, then Iran will not restrict the work of inspectors and return to its obligations under the accord.

"We will resume their complete implementation," Zarif said. The agreement was largely left in tatters after former US president Donald Trump unilaterally withdrew and ordered officials to reimpose tough penalties against Tehran as part of his administration's "maximum pressure" policy. Known as the Joint Comprehensive Plan of Action (JCPOA), the deal was agreed between Iran, the United States, China, Russian, Britain, France and Germany in 2015.

'Businesslike and Pragmatic'

The deal offered sanctions relief in exchange for curbs on Tehran's nuclear ambitions and guarantees it would not seek an atomic bomb. Iran maintains it has only pursued a civilian nuclear energy programme.

Immediately following the talks in Moscow, the French presidency on Tuesday said Iran must comply with the accord in order to see a US return, in direct contradiction to Russia's stance.

"If they are serious about negotiations and want to obtain a new commitmentfrom all participants in the JCPOA, first they must refrain from further provocations and second they must respect what they are no longer respecting" in terms of commitments, an official said on condition of anonymity.

Later Tuesday, Zarif tweeted: "It was the US that broke the deal—for no reason. It must remedy its wrong; then Iran will respond." A new wave of US sanctions has hit hard Iran's vital oil sector and its international banking ties, plunging the economy into a recession. Biden's pick for secretary of state, Antony Blinken, said at a Senate confirmation hearing this month that Trump's policies had made Iran "more dangerous.”

While Blinken confirmed Biden's desire for Washington to return to the nuclear agreement, both the United States and Iran have said the other must return to full compliance before the accord is implemented again.

Since the US exit, Russia and European signatories had advocated efforts to save the accord and cautioned Iran against bolstering its nuclear enrichment. Russia's Deputy Foreign Minister Sergei Ryabkov in December called on Iran to take "maximum responsibility" after Tehran announced plans to install advanced centrifuges in the country's main nuclear enrichment plant.

The ministry earlier this month blamed Iran's departure from the nuclear deal on "systematic crude violations" by the United States. Moscow appears cautiously optimistic over the fate of the deal under the new White House administration after its arms negotiator Mikhail Ulyanov described Washington's position as "businesslike and pragmatic.”

But time is running out for signatories to restore the nuclear deal and bring all parties back on track.

Legislation passed by Iran's parliament in December requires Tehran to boost uranium enrichment and limit UN inspections if sanctions are not removed by February.

Photo: IRNA

Trump Vows 'Snapback' to Force Return of UN Iran Sanctions

By Sebastian Smith with David Vujanovic

US President Donald Trump vowed Saturday to use a controversial technique to unilaterally reinstate UN sanctions on Tehran, a move with huge repercussions for the Iran nuclear deal.

His declaration came a day after the UN Security Council overwhelmingly rejected a US resolution to extend an Iranian arms embargo.

"We'll be doing a snapback," Trump said during a news conference at his New Jersey golf club. "You'll be watching it next week."

The president was referring to the contested argument that the US remains a "participant" in the 2015 Iran nuclear deal—despite Trump's withdrawal from it—and therefore can force a return to sanctions if it sees Iran as being in violation of its terms.

Iranian President Hassan Rouhani said the US had failed to kill off what he called the "half alive" deal with major powers that gave Iran relief from sanctions in exchange for curbs on its nuclear program.

"The United States failed in this conspiracy with humiliation," said Rouhani.

"This day will go down in the history of our Iran and in the history of fighting global arrogance."

Only two of the Council's 15 members voted in favor of the US resolution seeking to extend the embargo, highlighting the division between Washington and its European allies since Trump withdrew from the nuclear accord in 2018.

The Europeans on the Council all abstained, and Iran mocked the Trump administration for winning the support of just one other country, the Dominican Republic.

"In the 75 years of United Nations history, America has never been so isolated," foreign ministry spokesman Abbas Mousavi tweeted.

People on the streets of Tehran had mixed reactions.

"This is an American political game. One day they give a resolution to the Security Council, the next they say they have taken" Iranian fuel, said a worker at the city's Grand Bazaar who gave his name only as Ahmadi.

A drugstore employee named Abdoli told AFP she was happy Iran won, but added that it "should interact with the United States and establish relations.

Crisis

European allies have been skeptical on whether Washington can force sanctions, with experts saying a "snapback" threatens to plunge the Council into one of its worst-ever diplomatic crises.

Trump also said Saturday he would "probably not" take part in a summit proposed by Russian President Vladimir Putin on addressing the situation.

"I think we'll wait until after the election," he said, with the US set to hold its presidential poll in November. 

Putin had appealed to China, France, Britain, the US, Germany and Iran to convene an emergency video summit to avoid an escalation of tensions in the Gulf.

US Secretary of State Mike Pompeo, on a visit to Poland on Saturday, made it clear the United States would press on.

"It is unfortunate that the French and the United Kingdom... didn't support what the Gulf states have demanded, what the Israelis have demanded... I regret that deeply," Pompeo told reporters. 

"The United States is determined to make sure that the Iranians and this regime, this theocratic regime does not have the capacity to inflict even more harm on the world."

Israeli Prime Minister Benjamin Netanyahu denounced a "scandalous" UN vote.

"Iranian terrorism and aggression threaten the peace of the region and the entire world. Instead of opposing weapons sales, the Security Council is encouraging them," he said.

Threatened

The embargo on conventional arms is due to expire on October 18 under the terms of a resolution that blessed the Iran nuclear deal, officially known as the Joint Comprehensive Plan of Action.

Since Trump pulled out of the JCPOA and slapped unilateral sanctions on Iran, Tehran has taken small but escalatory steps away from compliance with the accord as it presses for sanctions relief.

European allies of the United States—who, along with Russia and China, signed the deal with Iran—have voiced support for extending the 13-year-long conventional arms embargo, saying an expiry threatens stability in the Middle East.

However, their priority is to preserve the JCPOA.

The US text at the Security Council on Friday, seen by AFP, effectively called for an indefinite extension of the embargo on Iran, which diplomats said would threaten the nuclear deal.

Iran says it has the right to self-defense and that a continuation of the ban would mean an end to the agreement.

Apart from 11 abstentions, Russia and China opposed the resolution.

"The result shows again that unilateralism enjoys no support, and bullying will fail," China's UN mission tweeted.

Photo: Wikicommons

Moscow Sees 'Chance' to Save Iran Nuclear Deal

Russia still believes there is hope of rescuing the nuclear deal with Iran, Foreign Minister Sergei Lavrov said Tuesday.

"We are convinced that there is still a chance to return the (Joint Comprehensive Plan of Action) into a stable situation," Russia's top diplomat said as he met with Iranian counterpart Mohammad Javad Zarif in Moscow.

"In any case, we will do everything to make it happen, just like our Iranian friends," he said.

Iran signed the agreement with the five UN Security Council members plus Germany in 2015, agreeing to limit its nuclear program in exchange for sanctions relief, but the deal has been on life support since US President Donald Trump withdrew from it and unilaterally reimposed sanctions in 2018.

Iran has since taken small but escalating steps away from compliance with the nuclear accord as it presses for renewed relief from sanctions.

Both ministers remarked that the deal "turned five years old" last week, with Zarif calling it a "historical international agreement."

After the two greeted each other with an elbow bump, Zarif thanked Russia for its "remarkable" efforts to keep the deal alive.

Iran's economy has been hard-hit by the US sanctions, which have scared off most international banks and firms from re-engaging with Tehran, and it has been further battered by the coronavirus epidemic.

Photo: Russian MFA

Sanctions Push Iran Past Russia as Biggest Buyer of Indian Tea

By Pradipta Mukherjee

Iran overtook Russia to emerge as the top buyer of Indian tea last year, after sanctions against the Islamic Republic halted imports other than specially negotiated deals.

India and Iran have been trading through a rupee-based bank account to bypass restrictions imposed by the U.S. While this bilateral trade has boosted imports of the Indian leaf at higher-than-normal prices, the outlook for orthodox teas is uncertain with even Lipton owner Unilever Plc weighing a sale of one of its best-known brands.

“This boost really has come because of the rupee-rial trade arrangement that we have had with Iran,” said Azam Monem, a director at McLeod Russel India Ltd., which is among the nation’s largest tea exporters. “India’s diplomacy should allow us to remain a partner to Iran where we supply humanitarian aid, tea and rice.”

Iranian Imports:

• Iran imported 53.5 million kilograms of tea from India last year, a rise of 74% from 2018

• The price per kilogram for Iranian purchases rose to about 276 rupees ($4) from 255 rupees, data from India’s Tea Board show

• Russian shipments dipped 3% to 46 million kilograms

Overall, Indian exports dropped 3% to 248 million kilograms last year as bad weather hit production in the crucial months of June and July. Prices rose 8.5% to 226 rupees per kilogram.

India also saw a 30% increase in shipments to China, the world’s biggest producer of tea, due to rising demand in the green-tea-drinking nation for India’s black-tea brands. Indian leaves such as Darjeeling, Assam and Nilgiri are used in processing the ready-to-drink milk tea popular across Asian nations.

However, India’s tea industry faces headwinds in controlling costs, after an increase in wages last year. Prices are unlikely to rise in 2020 unless consumption surges, according to Vivek Goenka, chairman of the Indian Tea Association.

“Any material increase in wage rates in the new season, without a substantial increase in tea prices, would prolong the stress,” said Kaushik Das, an analyst at Icra Ltd.

Photo: IRNA

Russia Rejects Extending Iran Arms Embargo, Defying U.S.

By Henry Meyer

Russia, seeing prospects for multi-billion dollar deals, ruled out extending a United Nations-approved arms embargo on Iran that expires in October next year, despite U.S. warnings that lifting the restrictions will jeopardize global security.

“We’re not ready to do the bidding of our American colleagues,” Deputy Foreign Minister Sergei Ryabkov told the Interfax news agency in an interview published Friday.

U.S. Secretary of State Michael Pompeo earlier this year warned that allowing renewed weapons sales to Iran will mean the country will be “unleashed to create new global turmoil.”

The removal of the UN arms embargo within five years was part of the 2015 nuclear deal with Iran, which the U.S. withdrew from last year. President Donald Trump’s administration has pursued a policy of “maximum pressure” on Iran in a bid to force the Islamic Republic back to the negotiating table. Russia, China and European powers have tried unsuccessfully to salvage the landmark accord curbing Iran’s nuclear activities, though formally it’s still in existence.

Ending the ban on military sales “is important for Russia as it will bring it closer to Iran and opens up the world’s last big untapped weapons markets,” said Ruslan Pukhov, head of the Center of Analysis of Strategies and Technologies, a defense-industry consultancy in Moscow. According to a recent report published by the think-tank, Iran could become a major customer for Russian hardware, including fighter jets, submarines and air-defense systems.

The arms embargo bars Iran from buying offensive weapons. Russia has sold its S-300 anti-aircraft system to Iran after ending a self-imposed moratorium that it put in place at Israel’s request.

Iran wants to purchase weapons “it has largely been unable to acquire for decades” when the embargo expires, an assessment released by the U.S. Defense Intelligence Agency said in November.

Iran is already targeting military supplies, primarily from Russia but also from China, the Pentagon report found. Iran’s potential acquisitions include Russian Su-30 fighters, Yak-130 trainers and T-90 tanks. Iran has also shown interest in buying the S-400 air-defense system and Bastion coastal defense system from Russia, it said.

Photo: Wikicommons

China, Russia, Iran to Hold Joint Naval Drills

China, Russia and Iran will hold joint naval drills starting Friday in the Gulf of Oman, Beijing and Tehran said, at a time of heightened tensions since the US withdrew from a landmark nuclear deal with Tehran.

Set to take place from December 27 to 30, the military exercises aim to "deepen exchange and cooperation between the navies of the three countries", Chinese defence ministry spokesman Wu Qian told reporters Thursday.

Wu said the Chinese navy would deploy its Xining guided missile destroyer—nicknamed the "carrier killer" for its array of anti-ship and land attack cruise missiles—in the drills.

But he did not give details on how many personnel or ships would take part overall.

For Iran, the drill's purpose was to bolster "international commerce security in the region" and "fighting terrorism and piracy," said senior armed forces spokesman Brigadier General Aboldazl Shekarchi.

The exercise would "stabilise security" in the region and benefit the world, state news agency IRNA quoted him as saying on Wednesday.

The US reimposed crippling sanctions on Iran in May last year after withdrawing from the international deal aimed at tackling the Islamic Republic's nuclear program, prompting Tehran to hit back with countermeasures.

Remaining parties to the badly weakened 2015 deal include China, Russia, Britain, France and Germany.

China's foreign minister said the exercises were part of "normal military cooperation" between the three countries.

In June, US President Donald Trump authorized a military strike after Iran shot down a US drone, only to call off the retaliation at the last moment.

Photo: IRNA

Iran to Seek Advanced Arms as UN Embargo Expires, Pentagon Says

By David Wainer and Tony Capaccio

Iran will seek to modernize its forces by purchasing advanced weapons systems once a United Nations arms embargo expires next year, the Pentagon is warning in a new report.

Iran wants to purchase weapons “it has largely been unable to acquire for decades” when the embargo expires in October 2020 in a compromise that’s part of the 2015 nuclear accord with world powers, according to an assessment released Tuesday by the Defense Intelligence Agency. Iran will be permitted to purchase weapons that it’s unable to produce domestically, such as advanced fighter aircraft and main battle tanks.

While U.S. President Donald Trump withdrew from the nuclear accord, his administration is pushing the international community to keep Iran from purchasing advanced weapons, arguing it will add to instability in the region. During a UN Security Council meeting in August, Secretary of State Michael Pompeo warned that the expiration of the embargo will unshackle Iran “to create new turmoil.”

“Because of the flawed Iran deal, the UN arms embargo on Iran will expire in one year,” Pompeo tweeted last month. “Countries like Russia and China will be able to sell Iran sophisticated weapons. The Iranian regime will be free to sell weapons to anyone. This will trigger a new arms race in the Middle East.”

Russian Weapons

Iran is already evaluating and discussing military hardware for purchase, primarily from Russia, but also to a lesser extent from China, the Pentagon report found. Iran’s potential acquisitions include Russian Su-30 fighters, Yak-130 trainers and T-90 tanks. Iran has also shown interest in acquiring the S-400 air defense system and Bastian coastal defense system from Russia, it said.

The report also highlights Iran’s growing use of unconventional tactics to deter large Western countries such as the U.S. Iran maintains an estimated inventory of more than 5,000 naval mines, which it can rapidly deploy in the Persian Gulf and Strait of Hormuz using high-speed small boats, it said.

It also warns that Iran’s forces are becoming “increasingly survivable, precise, and responsive.” It said the Islamic Republic’s capabilities, such as “swarms of small boats, large inventory of naval mines, and arsenal of antiship missiles” are a significant threat to maritime traffic in the Strait of Hormuz.

Kenneth Katzman, the primary Iran expert for the nonpartisan Congressional Research Service, said the report reinforces a “growing consensus in the expert community that Iran is close to accomplishing its core national security goals—the ability to project power in all corners of the region and thereby deter any regional or international actor from attacking Iran.”

Photo: IRNA

Iran, Russia Launch New Phase of Nuclear Power Reactor Construction

Tehran and Moscow inaugurated on Sunday a new phase of construction for a second reactor at Iran's sole nuclear power plant in Bushehr on the Persian Gulf coast.

Ali Akbar Salehi, head of the Atomic Energy Organization of Iran (AEOI), and deputy chief of Russia's nuclear agency Rosatom, Alexander Lokshin, launched the new stage at a ceremony where concrete was poured for the reactor base.

The reactor is one of two officially under construction since 2017 at the Bushehr site that is around 750 kilometres (460 miles) south of Tehran.

The landmark 2015 nuclear deal Iran signed with six major powers, including Russia, placed restrictions on the sort of nuclear reactor Tehran could develop and its production of nuclear fuel but it did not require Iran to halt its use of nuclear energy for power generation.

"In a long term vision until 2027-2028, when these projects are finished, we will have 3,000 megawatts of nuclear plant-generated electricity," Salehi said at the ceremony.

The Islamic republic has been seeking to reduce its reliance on oil and gas through the development of nuclear power facilities.

Russia built the existing 1,000 megawatt reactor at Bushehr that came online in September 2011 and is expected to undertake construction of a a third in future, according to the AEOI.

As part of the 2015 agreement, Moscow provides Tehran with the fuel it needs for its electricity-generating nuclear reactors.

Intended to guarantee that Iran's long-controversial nuclear program would never be used for military purposes, the survival of the deal has been under threat since the United States unilaterally withdrew from the agreement in May 2018, reimposing biting sanctions.

In response to the sanctions, which deprive Iran of anticipated benefits from the deal, Tehran began walking back on its commitments from May this year.

Photo: Rosatom

Unable to Buy Iran Oil, New Turkish Refinery Turns to Russia

By Ercan Ersoy and Baris Balci

Azerbaijan’s state oil company is turning to Russia to supply a new $6.3 billion refinery it built in Turkey because shipments from one of its preferred suppliers—Iran—are off the table due to U.S. sanctions.

The Star Refinery in Aliaga on the Aegean coast agreed to buy an initial 1 million tons of Urals crude—about one tenth of the plant’s annual processing—from Russia’s Rosneft PJSC, Mesut Ilter, the facility’s chief executive officer, said in an interview.

“If there were no restrictions, we would buy Iranian crude,” he said, adding that the refinery can purchase oil from anywhere “as long as our model supports it,” although in practice Azerbaijan’s own light crude isn’t really suitable.

The Trump administration this year ended waivers that allowed a handful of countries including Turkey to continue importing Iranian oil. Turkey has long opposed U.S. sanctions on Iran, with President Recep Tayyip Erdogan saying the measures violate international law and diplomacy. Tracking shipments from Iran toward Turkey has become trickier since the sanctions ramped up, making it hard to know how much, if any, Iranian oil Turkey is buying.

The State Oil Co. of Azerbaijan, or Socar, started operating the 200,000 barrel-a-day Star Refinery in October, helping to meet Turkey’s growing appetite for processed fuels while curbing imports. The project marked a growing energy interdependence between the two countries, with Turkey already a major destination for Azeri natural gas.

Turkey’s Tupras Turkiye Petrol Rafinerileri AS, owned by Koc Holding AS, was the country’s sole refiner until the Star plant came on stream. The new facility now accounts for a quarter of the nation’s refining capacity.

Product Range

The refinery, which is expanding storage capacity by more than 50% to 2.5 million cubic meters, will process almost 8 million tons of crude this year and 10 million tons thereafter, Ilter said. Refining margins range from $5 to $8 a barrel, he said.

At full capacity, the plant will produce 5 million tons of diesel a year, 2.5 million tons of petrochemical raw materials such as naphtha, and 1.5 million tons of jet fuel.

Turkey will cut its diesel imports to 40% of annual demand from 60% thanks to the new refinery, Ilter said. Along with Tupras, the Star facility will be able to meet all the nation’s domestic jet-fuel demand, even once Istanbul’s new airport reaches full capacity, he said.

However, future growth in demand for oil products will be centered on petrochemicals rather than transportation, according to the CEO.

“We have built this refinery considering Turkey’s long-term dynamics and petrochemical needs.”

Photo: Wikicommons

Moscow, Iran Urge Europe to 'Fulfil Obligations' Under Nuclear Deal

Russian Foreign Minister Sergei Lavrov and Iranian counterpart Mohammad Javad Zarif on Wednesday called on European signatories to abide by the Iran nuclear deal, following a meeting in Moscow. 

Zarif's visit came as Tehran said it had stopped respecting limits on its nuclear activities agreed under the deal until other signatories find a way to bypass renewed US sanctions.

Lavrov said during a joint press conference that the 2015 agreement had been "fragile" since US President Donald Trump announced Washington would pull out a year ago.

European signatories of the deal, known as the Joint Comprehensive Plan of Action (JCPOA), were trying to "divert attention" from their inability to implement points of the agreement, Lavrov said. 

 "We will call on them, as we have done before, to concentrate on implementing everything that is enshrined in the JCPOA and approved by the UN Security Council."

Lavrov said European mechanisms to allow banking transactions with Iran despite US sanctions were inefficient. 

"For Iran, it is important that this mechanism allows for the export of Iranian oil. We support the Iranians. This is a legal requirement and part of the JCPOA."

Zarif meanwhile said "our friends in Russia and China maintained very good relations with us in this year," since the US withdrawal.

"But the rest of the JCPOA participants did not meet any of their obligations," he said, referring to Britain, France and Germany.

“Yes, they issued good statements, but in practice nothing happened."

Lavrov also criticized Washington for sending aircraft carriers to the Persian Gulf, "suggesting a willingness to use force.”

Washington reimposed sanctions after it quit the agreement one year ago, dealing a severe blow to the Iranian economy.

Photo: IRNA

Russia's Lavrov to Hold Talks with Iran's Zarif

Russian Foreign Minister Sergei Lavrov will meet his Iranian counterpart Javad Zarif in Moscow on Wednesday, the Russian foreign ministry said Tuesday.

The two diplomats, longtime allies on a number of issues including the Syrian conflict, will discuss "key issues of the international and regional agenda" as well as bilateral cooperation, the ministry said in a statement.

"Cooperation with Iran is an important condition of ensuring our country's national interests" and stability in the South Caucasus and the Middle East, it said.

Moscow has backed Iran since helping orchestrate the multi-country nuclear deal in 2015 under which Tehran agreed to halt its nuclear program in exchange for the lifting of sanctions.

While Washington has pulled out from the nuclear deal, Russia argues that Tehran "remains a responsible participant", the ministry said.

The United States on Monday warned it would deploy an aircraft carrier strike group to the vicinity of Iran in response to "indications of a credible threat by Iranian regime forces."

Kremlin spokesman Dmitry Peskov said Zarif would not be meeting President Vladimir Putin on Wednesday.

Photo: IRNA

Oil Squeeze on Iran Aids Putin's Power Play in the Middle East

If President Donald Trump succeeds in cutting Iran’s oil exports to almost nothing, one of the main beneficiaries is likely to be Russia.

The economic blow to Iran will ease the Kremlin’s efforts to rein in Iranian influence in Syria, bolstering President Vladimir Putin’s efforts to project Russian power across the Middle East. Tehran and Moscow were one-time collaborators in the region, but they’ve found themselves increasingly at odds as Syria’s eight-year-old civil war winds down.

In recent months, the two main power brokers in Syria have engaged in deadly clashes, with Russian and Iranian forces and their proxies firing at one another, according to a Russian official and media reports. The relationship between the two countries is tense, three people close to the Russian government confirmed, speaking on condition of anonymity to discuss confidential matters.

Countering Iran will become easier after Trump removed waivers that allowed it to sell oil to countries including China, India and Turkey because the country “will be a lot more squeezed,” said Yury Barmin, a Middle East expert at the Moscow Policy Group research organization.

Sentiment Sours

Since Trump re-imposed sanctions last year, Iranians have been burned by a lack of solidarity from their one-time partners. Tabnak, a conservative news site founded by a former Revolutionary Guards commander, complained in a recent commentary that Moscow hasn’t shown any “serious determination” to stand with Tehran.

Iran’s ejection from international oil market also benefits Russia financially: it’ll be free to resume pumping at full capacity when output curbs agreed with OPEC expire in June, said Dmitry Marincheko, oil and gas director at Fitch Ratings. That will earn it about an extra $6 billion a year, at current prices.

As relations with Iran soured, Russia invested in unprecedented cooperation with its chief rival, Saudi Arabia, inking a joint agreement with OPEC on limiting oil production. That succeeded in stabilizing prices.

Although Moscow and Riyadh have backed opposing sides in Syria, Putin has been trying to persuade other Arab nations to drop their hostility to Syrian President Bashar al-Assad and reintegrate the nation into the Arab League. A smaller Iranian footprint in Syria makes that more palatable to Sunni Gulf states that see Shiite Iran as their primary rival, said Barmin of Moscow Policy Group.

Armed Clashes

Russian troops have been seeking to gradually push the Iranian-backed Lebanese Shiite militia, Hezbollah, out of Syria, and pro-Iranian and pro-Russian detachments have exchanged fire increasingly since late last year, with three armed incidents reported in April alone.

That included one on April 19 in the eastern province of Deir Ezzor in which two Iranian Revolutionary Guards were killed and four Russian military police wounded, according to Turkey’s Anadolu Agency. Far more deadly clashes occurred in January between rival branches of the Syrian military backed respectively by Iran and Russia, Russian newspaper Novaya Gazeta reported.

The conflict is partly over which side mans checkpoints and benefits from it financially, said Rami Abdurahman, director of the U.K.-based Syrian Observatory for Human Rights, which monitors the war through activists on the ground. But it also reflects a much broader standoff, said Nikolay Kozhanov, a Middle East expert at the European University at St. Petersburg, who served as a Russian diplomat in Tehran from 2006-2009.

Different Goals

“Although Russia and Iran are both interested in ensuring the survival of Assad, they have completely different strategic goals and priorities,” Kozhanov said.

Iran sees Syria as a key front in its battle to carve out a dominant regional role and threaten Israel. That runs afoul of Russia’s aim of using its footprint in Syria to advance Putin’s global ambitions while keeping ties to all major players in the region, including Israel, said Kozhanov. Russia has allowed repeated Israeli air raids on Iranian-backed targets in Syria, according to the ex-Russian envoy.

Russian Deputy Foreign Minister Sergei Ryabkov in January denied that Iran was an ally of Russia and said his country was committed to ensuring the “very strong security of the state of Israel.”

Financial Interests

Economically as well, Russia and Iran are competitors in Syria, London-based research group Chatham House said in a March report.

In early 2017, Syria and Iran signed a memorandum of understanding on a phosphate mining concession near the ancient site of Palmyra. But six months later, Syria signed rights over the same mine to a Russian company owned by a Putin ally, Chatham House said.

The U.S. designation of the Islamic Revolutionary Guards Corps, a branch of the Iranian army, as a terrorist organization in mid-April makes it more difficult for Iran to ship oil, and allows Russia to challenge its role as the main supplier of fuel to the Syrian government, said Barmin.

Disagreements could sharpen over which foreign forces should stay in Syria, said Diako Hosseini, director of the world studies program at the Center for Strategic Studies in Tehran, which is affiliated with the Iranian presidential office.

While the two sides continue to cooperate in efforts to engineer a political post-war settlement, there are concerns the tensions could spiral out of control.

In one possible worst-case scenario for Syria, the Russian-Iranian partnership collapses completely and military groups loyal to each side engage in a fight, said Andrei Kortunov, director general of the Russian International Affairs Council, a Kremlin-founded think tank.

“The once-implicit competition between Moscow and Tehran for influence in Damascus would then become explicit,” he said.

Photo Credit: Bloomberg

Russia Snubs US-Polish Conference on Iran

Russia on Tuesday slammed a planned US-Polish conference on peace and security in the Middle East as "counterproductive" because of its focus on countering Iran, and said it would not attend.

US Secretary of State Mike Pompeo has announced plans for the major conference in Warsaw on February 13 and 14 to be attended by ministers from a dozen countries.

Addressing the UN Security Council, Russian Ambassador Vassily Nebenzia said the conference would fail to bolster Middle East security because of its "one-country aspect" and failure to address the Israeli-Palestinian conflict.

"Attempts to create some kind of military alliances in the region by holding conferences and focussing on having a simplified unilateral approach that is clearly linked just to Iran are counterproductive," Nebenzia told a council debate on the Middle East.

Such a move "just further pushes away the prospects of finding a genuine security architecture for the region," he added.

In Moscow, the Russian foreign ministry released a statement saying Russia would not attend the meeting which is described as an "anti-Iran platform" and a bid to create conditions to weaken the Iran nuclear deal.

"Why has that conference not invited Iran, which is one of the most significant and large countries in the region?" asked Nebenzia.

Iran has reacted angrily to the planned conference and warned Poland that it could face consequences for hosting the gathering.

Pompeo first announced the conference on January 11 to bring together countries in addressing peace and security in the Middle East, and make "sure that Iran is not a destabilizing influence" in the region.

The conference has also received a cool reception from European countries. 

Facing a lack of enthusiasm, acting US Ambassador Jonathan Cohen described the Warsaw meeting as a "global brainstorming session" and stressed that it was "not the venue to demonize or attack Iran."

Some of the agenda items for the conference include the humanitarian crises in Syria and Yemen, missile development and cyber security, Cohen told the council.

Photo Credit: UN

Iran Sanctions Herald Energy Trouble for Caucasus Nations

This article has been republished with permission from Eurasianet.

The resumption of wide-ranging American sanctions on Iran promises economic uncertainty for the Islamic Republic’s neighbors in the Caucasus: Azerbaijan, Georgia and Armenia.

Washington's goal of reducing Iran's oil exports to zero will not directly impact any of three Caucasus states, as none of them imports Iranian crude. All three, however, have to various extents relied on Iran for natural gas, and stand to be affected—if only by uncertainty until the exact scope of the sanctions becomes clearer.

U.S. National Security Adviser John Bolton recently visited all three countries to try to shore up support for Washington’s efforts to isolate Tehran, though his results were inconclusive. When Washington imposed the new round of sanctions on November 5 it exempted eight countries, including neighboring Turkey, but none of the Caucasus states were spared.

As a major exporter of both crude oil and natural gas, and a sometime importer of Iranian gas, Azerbaijan's position is most complex.

Azerbaijan shares long land and maritime borders with Iran, as well as ownership of a number of undeveloped Caspian oil and gas fields subject to a joint development agreement signed in March this year.

Development of those fields is now unlikely to proceed, but other joint ventures have advanced beyond the point where even Washington can impose a halt.

Azerbaijan's main gas field, Shah Deniz, is being developed by a consortium led by UK oil giant BP, but in which Iran's national oil company, NIOC, holds a 10 percent stake.

Shah Deniz is currently the only source of gas for the long-planned, EU-backed Southern Gas Corridor (SGC), aimed at lessening Europe’s dependence on Russian energy.

Already in August, Washington made the position of Shah Deniz and the SGC project clear when the Treasury Department granted a permanent waiver from Iran-related sanctions for "the development of natural gas and the construction and operation of a pipeline to transport natural gas from Azerbaijan to Turkey and Europe."

That concession means that neither BP, the Azerbaijani state oil company SOCAR, nor the other three shareholders will face sanctions related to that project.

Azerbaijan also stands potentially to benefit from any increase in global oil prices caused by the halting of Iranian exports. That uncertainty also would lead to an increase in natural gas prices, which are for the most part indexed to oil prices. 

"Azerbaijan may well reap some secondary benefits from U.S. sanctions on Iran, since it stands to gain if oil prices increase as a result of heightened tensions in the Persian Gulf," Caspian energy analyst and Atlantic Council fellow John Roberts told Eurasianet, though he cautioned that any potential benefits are unpredictable as they rely on factors beyond Baku's control.

Roberts added that Azerbaijan's position is further complicated by its position as an importer of natural gas from Iran.

Azerbaijan imports small volumes of Iranian gas into its exclave of Nakhchivan for local consumption. Also, in recent years, gas from Turkmenistan has transited via Iran into mainland Azerbaijan to supplement its own production and to meet export commitments to Georgia, which is expected to import around 2.7 billion cubic meters of gas from Azerbaijan this year.

SOCAR spokesman Ibrahim Ahmadov told Eurasianet that the company’s gas imports via Iran have now stopped thanks to increased domestic production. 

"A big part of the imported gas was used to fill our gas storage during summer which is then re-exported in winter when there is higher demand," Ahmadov said. With more than 3 billion cubic meters currently in storage, and further imports due from Russia before the end of the year, SOCAR doesn't anticipate shortages. "There should be no problems with the gas supply in Georgia," Ahmadov said.

Sandwiched between Iran and Armenia, and with a tiny outlet to Turkey, Nakhchivan's geography limits its alternatives. 

An agreement with Ankara for a pipeline link to bring gas into Nakhchivan from Turkey was signed in 2010, but to date no pipeline has been laid, leaving the exclave still dependent directly on swap arrangements with Iran.

Such barter deals would not necessarily put Baku in breach of the U.S. sanctions. Ahmadov confirmed that SOCAR is “not planning any payment-based transactions with Iran in the near future.”

If Azerbaijan's gas exports to Georgia will indeed be unaffected, then Georgia – which with its Black Sea coast has no need to import Iranian petroleum products – should be little troubled by the U.S. sanctions.

Few Options for Armenia

The same, though, cannot be said for Armenia, whose landlocked geography and regional political isolation leave it few options.  

With few natural resources of its own, and still getting over 40 percent of its power supply from the aging Metsamor nuclear power plant, Armenia has become increasingly dependent on imported gas to meet its energy needs.

The bulk of Armenia’s gas is imported from Russia (via Georgia), but Yerevan also imported about 400 million cubic meters of gas from Iran in 2017, and sends Iran power in exchange. In late 2017 an agreement was announced for Armenia to boost Iran gas imports by up to 25 percent, and to increase power exports by a similar amount.

The status of that agreement and of existing Iranian gas exports to Armenia is currently unclear.

On November 6, Armenian foreign ministry spokesperson Anna A. Naghdalyan tweeted that her ministry was closely monitoring developments. "A comprehensive examination of the effects the new sanctions will have on Armenia is ongoing," she said. She did not respond by press time to queries from Eurasianet.

Armenia's position is further complicated by the fact that much of its gas pipeline network is owned by Russia's Gazprom. The two have long bickered over the price Gazprom charges for the gas it supplies.

Forcing Yerevan to abandon Iranian imports will thus leave it more dependent on Russia, and in a far weaker bargaining position. 

Photo Credit: BP

Russia, Spain Slam US 'Ultimatums' on Iran

The foreign ministers of Spain and Russia on Tuesday hit out at US sanctions policy against Iran and ultimatums they say are being imposed by Donald Trump's administration.

President Trump in May abandoned a 2015 multi-nation deal with Iran aimed at reining in its nuclear program.

The deal had been unanimously endorsed by a United Nations Security Council resolution, making it legally binding.

On Monday, Washington reimposed its last tranche of sanctions—punitive measures targeting the Iranian oil and financial sectors.

The Trump administration nevertheless gave eight countries temporary waivers, allowing them to continue to buy oil from Iran—China, India, Turkey, Japan, South Korea, Taiwan, Italy and Greece.

But in general the US sanctions stipulate that to maintain access to the US market, countries and foreign companies must stop trading with Iran.

“Sanctions are absolutely illegitimate, they are are being imposed in flagrant violation of the UN Security Council's decision," Russian Foreign Minister Sergei Lavrov told reporters in Madrid.

"And the forms in which these measures are being declared and implemented cannot cause anything but deep disappointment.

"It is not acceptable in our age to pursue a policy based on ultimatums and unilateral demands."

Spanish Foreign Minister Josep Borrell concurred, saying he rejected "any kind of position that resembles an ultimatum from anyone and also from the United States.

"This notion of 'you're either with me or against me' is of another era."

Photo Credit: Wikicommons

After Bolton Takes aim at Russia and Iran, is Armenia the Collateral Damage?

Befitting his bull-in-a-china-shop reputation, John Bolton's whirlwind tour of the Caucasus left a trail of geopolitical wreckage that his hosts are still trying to pick up even after Bolton himself is back in Washington.

As expected, the visit of Bolton, the U.S. National Security Adviser, focused on getting the states of the South Caucasus—Georgia, Armenia, and Azerbaijan—on board with Washington's efforts to isolate Iran.

Bolton visited all three countries, but his public statements in Tbilisi and Baku were more or less pro forma for an American official visiting the Caucasus. It was in Yerevan where he repeatedly made provocative comments that vexed his hosts, and where the fallout from his visit continues.

Armenia's position vis-à-vis Iran is especially delicate, as the ongoing conflict with Azerbaijan has resulted in its borders to the east (with Azerbaijan) and west (with Turkey) being closed. So Armenia relies on its southern border with Iran as a key outlet.

In the past, the U.S. has tended to look the other way at Armenia-Iran ties, even as it pursues broad sanctions against Tehran, since it understands that Armenia has few other options. Bolton, though, suggested that that lenience may be coming to an end.

As the U.S. ratchets up pressure on Iran, the Armenian-Iranian border is “going to be a significant issue,” Bolton told the Armenian service of Radio Free Europe/Radio Liberty.“We are going to squeeze Iran because we think their behavior in the Middle East and, really globally, is malign and needs to be changed.”

Bolton acknowledged that he understood why Armenia needed Iran, but said that the solution was to end the conflict with Azerbaijan.

Bolton told RFE/RL that “current circumstances highlight” the importance of Armenia and Azerbaijan “finding a mutually satisfactory agreement to the Nagorno-Karabakh issue,” referring to the territory over which the two countries are fighting. “Once that happened, then the Armenian-Azerbaijani border would open,” Bolton said. “The Turkish border, I believe, would almost certainly open.”

That is all technically true, but the notion that Yerevan would orient its relations toward Azerbaijan—which it regards as an existential threat—around the U.S.'s policy of isolating Iran fell flat among Armenians.

“John Bolton, or anyone for that matter, cannot speak on my behalf,” Armenian Prime Minister Nikol Pashinyan told a news conference following Bolton's visit. “They are moving forward with the logic that they have some kind of ownership of the Karabakh issue, and now they are attempting to sell it to me, without asking my opinion.”

Bolton's dabbling in Karabakh diplomacy followed a controversial interview given the week before by the outgoing U.S. ambassador, Richard Mills, in which the envoy said it was “disturbing” how few Armenians were willing to make concessions to Azerbaijan over Nagorno-Karabakh. “The harsh reality is that any settlement is going to require the return of some portion of the occupied territories,” Mills told the news site EVN Report.

While that is also technically true, the combined effect of the Mills and Bolton statements added to a sense in Yerevan that the new Pashinyan government's tentative steps toward the West are being repaid by a conspicuous lack of sympathy toward Yerevan's position. On top of that, the Trump administration has evinced little interest in the Caucasus – even by the low standards of the U.S. – and little indication that Washington has anything to offer Armenia in exchange for the dramatic moves Bolton proposed.

“Not since the failed and dangerous Turkey-Armenia Protocols has the United States been so keen on pressuring Armenia to adapt to American priorities in the region,” wrote the Armenian-American news site Asbarez in a commentary on Bolton's visit.

That sense was seized on by members of the former regime. In a Facebook post, former defense minister Vigen Sargsyan criticized “Pashinyan's American fiasco” and complained that “Bolton not only repeated Azerbaijan's thesis that Armenia is to blame for the blockade [of the Armenia-Azerbaijan border], but also justified Turkey's closure of its border with Armenia.”

While in the Caucasus, Bolton also mooted the prospect of the U.S. reversing its policy of not selling arms to Armenia or Azerbaijan. That would almost certainly benefit Azerbaijan more, as Baku has far more money with which to buy American weapons, which are generally much more expensive than the Russian arms on which both Armenia and Azerbaijan largely rely.

Nevertheless, the offer was presented as a sort of carrot for Yerevan. “As I said to the prime minister, if it’s a question of buying Russian military equipment versus buying U.S. military equipment, we’d prefer the latter,” Bolton told RFE/RL. “We think our equipment is better than the Russians’ anyway.”

Bolton also targeted Armenia's recent announcement that it would send a small team of sappers to help Russia in its demining efforts in Syria. “It would be a mistake for anybody else to get involved militarily in the Syrian conflict at the moment,” Bolton told a news conference in Yerevan. “There are already … seven or eight different combatant sides. To get involved with any one of them for any other country would be a mistake,” he said.

The Kremlin, naturally, did not take kindly to Bolton's attempts to drive a wedge between Armenia and Russia; Yerevan is Moscow's closest ally in the Caucasus and Armenia depends heavily on subsidized Russian weaponry.

In a sharply worded statement issued after Bolton left, the Russian Ministry of Foreign Affairs seized on the American's reference to Armenia not needing to be constrained by “historical antecedents” in its foreign relations. Bolton “demanded openly that Armenia renounce historical clichés in its international relations and hardly bothered to conceal the fact that this implied Armenia’s traditional friendship with Russia,” the MFA said, calling the demand “impudent.”

The statement continued: “Incidentally, not all of John Bolton’s statements in Yerevan deserve to be criticized. In his October 25 interview to Radio Liberty, he made a wonderful comment: 'I think that’s really fundamental to Armenia exercising its full sovereignty and not being dependent on or subject to excessive foreign influence.' It would be good if John Bolton thinks over the meaning of his own words.”

Photo Credit: Armenian Prime Minister

Iran Says OPEC Has 'Not Much Credit' Left

Oil cartel OPEC has "not much credit" left as some members are turning it into "a tool for the US", a senior Iranian official said in comments published Saturday.

"Saudi Arabia and the UAE are turning OPEC into a tool for the US and consequently the organization has not much credit left," Iran's OPEC governor Hossein Kazempour Ardebili told the Shana newswire, affiliated to Iran's Oil Ministry.

"It is a fact that OPEC is losing its organizational character and becoming a forum," he added.

In a move heavily opposed by Iran, OPEC and other oil producers including Russia agreed in June to boost crude output by around a million barrels a day, reversing course after supply cuts that had cleared a global glut and boosted prices.

Iran, a founding member of the cartel, had been against the move which came as the country faces renewed US sanctions after Washington's decision to leave the 2015 nuclear deal between Tehran and world powers.

The US decision had stoked supply concerns on world markets.

Ardebili also accused Saudi Arabia and Russia of taking the market "hostage" through increased production and said that OPEC's responsibility is to restore market balance, not to boycott its founding members.

US President Donald Trump has repeatedly urged the cartel to raise its production and said that other countries must stop buying oil from Iran or face US sanctions.

Meanwhile, output from Iran has hit its lowest level since July 2016 as top buyers India and China distance themselves from Tehran due to looming US sanctions on November 5, according to the International Energy Agency.

Photo Credit: Wikicommons

Eyeing Reconstruction, Russia, Iran Take Centre Stage at Syria Expo

Companies from dozens of countries are showing their wares at the Damascus International Fair this week, but those from two in particular are getting special treatment—Russia and Iran.

Firms from the top two wartime allies of Syria's government are set up in an entirely separate building, hinting at the preferred status they hope to enjoy as the country tries to transition into reconstruction.

Packed pavilions feature Iranian cars and carpets, Russian wires and cables—and translators ready to help Syrian businessmen connect with potential foreign partners.

A flatscreen television in the Russian wing plays a sleek advertisement for Libena Agro Build, a metalworking company that produces farming equipment and grain silos.

“Foreign companies are scrambling and competing to invest in Syria, but Russia's got preference," says its regional representative, Lebanese-Russian national Leba Shehadeh.

"We were the ones defending Syria politically and militarily, so we expect the lion's share of the economy and of the reconstruction phase."

He flips through a pamphlet of irrigation products, metal recycling services, moulds, and more.

"Syria needs all this equipment," Shehadeh tells AFP, saying Libena Agro was aiming for large-scale deals with Damascus.

"We're here so that, together, we can draw the plan for rebuilding this country."

Seven years since war first broke out, President Bashar al-Assad has managed to recapture around two-thirds of Syria, with help from both Tehran and Moscow.

Iranian "military advisers" and Tehran-backed militias have supported troops on the ground, and Russian warplanes have battered rebel targets from the sky for the past three years.

’Attractive for Investment'

But fighting has left Syria in ruins, with the United Nations saying 
destruction has cost the country close to USD 400 billion. 

Assad has pledged to make reconstruction his top priority, saying Syria's "allies" would be the only ones allowed to take part.

Even during war, Russian companies have invested in Syria's oil, gas and mining sectors and won contracts to build flour mills and water-pumping stations. 

Syrian state companies have also issued tenders open exclusively to Iranian companies, according to the economic magazine Syria Report. 

Just last month, Tehran and Damascus reached a deal for Iran to rehabilitate Syria's defense industry. 

And on Friday, at the fair's opening, the Russian and Syrian ministries of industry inked a memorandum of understanding on future cooperation.

The Russian ministry had organized a delegation of investors to attend the fair, including representatives of Romax, a firm that produces storage silos and is involved in transportation and shipping. 

“The Syrian market is attractive for investment," says its representative at the fair, Aron Levashov.

"We're finding a window, a gate for Russia towards the Mediterranean sea, and from there to Europe and Africa," he tells AFP, speaking in Russian through an interpreter.

He says Russia's "familiarity with the situation on the ground, the markets, the depth and scope of destruction" gave it a better understanding of Syria's economic needs. 

"Russia proved herself with a show of force in the air, and it's continuing its political support. We should take advantage of the space afforded to us to crystalize our economic role," Levashov tells AFP. 

'Like Brothers'

Companies from 25 countries, as well as officials from another 23 are taking part in the fair, Syrian state media said.

Around 50 Russian firms are being represented, and Iran has made an equally strong showing. 

Mohammad Reza Khanzad, who runs the Iranian pavilion at the expo, says the wing "includes 50 Iranian companies, among them 32 firms specialising in reconstruction"—compared with 31 firms in total last year. 

"The rest are in various industries like car production, homeware, programming, reconstruction materials, handmade carpets and agriculture," he says.

At a nearby table, Iranian businessman Mehdi Qawwam, 38, is smoothly pitching his construction firm Maskan Omran to three Syrian entrepreneurs in Farsi through a translator. 

"After Syria's war, the market will need companies specialized in construction and will benefit from Iranians to rebuild an even stronger market," he says.

Dressed in a grey suit, Qawwam concludes his sit-down and tucks newly acquired business cards into his suitcase.

"We reached some preliminary agreements to facilitate the entry of Iranian goods exclusive to our company into Syria, and in the coming phases we'll have meetings in Tehran or Damascus to confirm those deals," he says.

Strolling through the expo, he waves to friends and rivals alike.

"Syria is one of the few countries that accepts our products in the wake of the US sanctions" reimposed by Washington last month, he says.

"These sanctions must not affect us, because the relationship between our two countries is like one between brothers."

Photo Credit: EPA

Caspian Sea Nations to Sign Landmark Deal

The leaders of the five states bordering the Caspian Sea meet in Kazakhstan on Sunday to sign a landmark deal on the inland sea which boasts a wealth of oil and gas reserves and sturgeon.

Azerbaijan, Iran, Kazakhstan, Russia and Turkmenistan are expected to agree a long-awaited convention on the legal status of the sea, which has been disputed since the collapse of the Soviet Union rendered obsolete agreements between Tehran and Moscow.

Talks in the port city of Aktau should help ease tensions in a militarized region where the legal limbo has scuppered lucrative projects and strained relations among nations along the Caspian's 7,000-kilometre (4,350-mile)  shoreline.

The Kremlin said the convention keeps most of the sea in shared use but divides up the seabed and underground resources. 

It does not allow military bases from any other countries to be sited on the Caspian.

'Once a Frontier Oil Province' 

Sunday's summit is the fifth of its kind since 2002 but there have been more than 50 lower-level meetings since the Soviet breakup spawned four new countries on the shores of the Caspian.

The deal will settle a long-lasting dispute on whether the Caspian is a sea or a lake—which means it falls under different international laws. 

The draft agreement, briefly made public on a Russian government portal in June, refers to the Caspian as a sea but the provisions give it "a special legal status", Russian deputy foreign minister Grigory Karasin told Kommersant daily.

It is the Caspian's vast hydrocarbon reserves -- estimated at around 50 billion barrels of oil and just under 300 trillion cubic feet (8.4 trillion cubic meters) of natural gas in proved and probable reserves -- that have made a deal both vital and complex to achieve. 

"Disputes arose when the Caspian was a frontier oil province," said John Roberts, a non-resident senior fellow at Atlantic Council's Eurasia Center,  while it is "now well established, with major fields approaching peak... production."

'Expand Cooperation'

Any deal will "expand the field for multilateral cooperation" between the five states, said Ilham Shaban, who heads the Caspian Barrel think tank.

But some are likely to view it as more of a breakthrough than others.

Energy-rich but isolated Turkmenistan is particularly excited and President Gurganguly Berdymukahmedov has called for annual Caspian Sea Day celebrations from Sunday onwards.

Turkmenistan could benefit from a concession allowing the construction of underwater pipelines, which were previously blocked by the other states. 

Nevertheless, analysts caution that Turkmenistan's long-held plan to send gas through a trans-Caspian pipeline to markets in Europe via Azerbaijan is not necessarily closer to becoming reality.  

The plan was previously opposed by Russia and Iran, which could still attempt to block the pipeline—valued at up to USD 5 billion—on environmental grounds.

"A deal in Aktau is not a legal prerequisite for the construction of the Trans-Caspian Pipeline," said Kate Mallinson, Associate Fellow for the Russia and Eurasia Program at Chatham House. "Neither will a major transport corridor to export Turkmen gas to Europe emerge overnight."

Kudos and Caviar

As previous exclusive arbiters of Caspian agreements, Russia and Iran could be seen as the new deal's biggest losers. 

But while Moscow has ceded ground on underwater pipelines "it gains political kudos for breaking a log-jam," enhancing its image as diplomatic dealmaker, said Roberts of the Eurasia Center.

Russia will welcome the clause barring third countries from having military bases on the Caspian, underscoring its military dominance there, said Shaban of Caspian Barrel. 

Iran gets the smallest share of the Caspian spoils under the new deal, but could take advantage of new legal clarity to engage in joint hydrocarbons ventures with Azerbaijan.

In the past Tehran has resorted to hostile naval manouvers to defend its claims to contested territory.  

Beyond military and economic questions, the agreement also offers hope for the Caspian's ecological diversity. 

Reportedly depleted stocks of the beluga sturgeon, whose eggs are prized globally as caviar, may now grow thanks to "a clear common regime for the waters of the Central Caspian," Roberts said.

The deal could result "not only in stricter quotas for sturgeon fishing, but in stricter enforcement of these quotas," he added.

Photo Credit: IRNA