Iran: Skirting Sanctions

By INU staff,

In the wake of price drop experienced by all OPEC countries, the overall health of the Iranian oil economy is uncertain. Iran needs higher oil prices to balance its budget than its fellow OPEC members. And especially with Western sanctions in effect, it also needs to rely on different markets. There is some uncertainty surrounding which markets those will be in the near future.


Iran appears intent on giving the impression that it is neither threatened by economic obstacles nor in danger of losing existing markets. UPI gives an example of this in reporting on Iran’s denials about the prospect of its oil pipeline deal with Pakistan falling through. Tehran indicates that the project is still going forward and is nearing completion, but Pakistan’s Daily Times recently contradicted these claims by saying that the project had fallen through as a result of continuing economic sanctions on Iran.

This dispute may also give additional relevant context to last week’s news that Iran had threatened to take action against unspecified terrorist threats across the border with Pakistan. The statement has already been interpreted as a possible show of strength, in which case it might have been aimed at securing compliance on economic plans like the pipeline project.

At the same time, additional recent news suggests that Iran’s broader foreign policy serves to either give it more leverage in that effort, or provide it with alternatives in the event that its dealings with Pakistan do fall through. Indian Express reported on Monday that Iran and India had Iran and India have agreed to jointly develop the Iranian port of Chabahar, in order to provide a new route for international access to trade with Afghanistan. This comes at a time when relations between India and Pakistan are deteriorating, so Iran’s closeness with both rivals allows it to play both sides and bet on future relations with each.

Elsewhere, Iran is continuing to pursue barter trade agreements with regional partners, giving it a means of continuing to evade economic sanctions in the event that they are re-imposed. As reported by, some of these barter arrangements were re-solidified on Monday when the Prime Minister of Armenia visited Tehran to discuss, among other things, the continued exchange of Iranian natural gas for electricity.

And these trade agreements are only the most legitimate and the least dangerous of Iran’s efforts to expand its influence throughout the Middle East and Asia. The Associated Press made mention of another on Monday when it reported that Iran had signaled its interest in supplying arms to the Lebanese military, ostensibly for use against the Islamic State. But Iran also had a reputation for arming and financing Lebanese Hezbollah, a paramilitary known for launching attacks against Israel. Furthermore, last week Iran’s Supreme Leader Ali Khamenei explicitly called for further war against Israel.

But whether Iranian arms shipments are destined for a terrorist paramilitary or a national army, such shipments are in violation of an arms embargo imposed upon the Islamic Republic by the UN in 2007.

On the basis of illicit activities like these, Iran is subject to serious criticism from its rival states in the Gulf Region, which are concerned about the spread of Iranian influence. World Bulletin points out that Anwar Mohammed Gargash, the United Arab Emirates’ Minister of State for Foreign Affairs, issued a new warning about such spreading influence on Sunday. These, he said, pose a threat to the region and are often based on sectarian, ideological policies.

This is certainly the basis for concern about Iran’s continuing influence in Iraq, which has been a major source of concern for opponents of Tehran. Iran’s state-affiliated Tasnim News Agency boasted on Monday that the new Iraqi Prime Minister, Haider al-Abadi, will be visiting Tehran in the near future, and that this would lead to “all-out ties between the two Muslim neighbors.”

Iran and Iraq are two of the rare Shiite-majority states, and under the reign of Abadi’s predecessor Nouri al-Maliki, Iranian support led to the consolidation of power into a small set of Shiite hands, disenfranchising Sunnis and other minorities and pushing some Sunnis into the arms of the Islamic State of Iraq and Syria.

Also on Monday, Tasnim News Agency printed a much more general boast in the form of comments by Iranian Revolutionary Guard Corps Navy Commander Rear Admiral Ali Fadavi, who effectively asserted superiority over other nations in the region. Fadavi referred to those other countries as the “younger brothers of the great nation of Iran,” and suggested that they should rely on Iranian military might to secure mutual global interests. Fadavi also used his comments to attempt to sow distrust of the United States and Britain, and to call for Muslim unity in opposition to them.

Meanwhile, al-Monitor reminds us that this antagonism of the West is not limited to the Muslim world. An article at the Middle East news site suggests that important international events are being missed amidst the world’s focus on the Islamic State, and that one of these is the growth of relations between Iran and China, culminating last month in a series of joint military maneuvers by the two countries in the Persian Gulf.

Al-Monitor makes clear that in addition to being a boon to Iran, this military partnership is a serious challenge to American interests in the region, in that it brings what is arguably the US’s greatest rival into the Gulf for the first time in history. Furthermore, it allows Iran and China to directly match recent shifts in US foreign policy, which have attempted to focus on Asia over the long term, instead of just the Middle East. But if major players in both of these regions are partnered against the US, it’s not clear that such a shift will provide any real benefit to Western interests.


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