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Russia and Iranian oil

Iran critics certainly consider the regime’s involvement in foreign conflicts to be another reason why it cannot be trusted on the world stage in general, and particularly in nuclear negotiations. Some of these also point to signs of duplicity or intransigence in the negotiations themselves, with oil exports being one example.

Reuters reported on Wednesday that even though those exports fell to a lower level in July, the total numbers remained in excess of the monthly limit imposed and agreed upon under the Joint Plan of Action that initiated the ongoing nuclear talks. Nevertheless, Washington has virtually ignored this violation of the agreement, partly by claiming that the portion of the figures made up of condensates is allowable, and partly by disregarding oil exports to Syria as gifts rather than sales.

Meanwhile, there remains the question of illicit oil sales through such traditionally anti-Western partners as Russia. Reuters also reports that although the two nations have announced no concrete details, Russia and Iran have been discussing a deal that would allow Russia to barter for Iranian oil, thus circumventing sanctions enforcement.

One detail that had initially been provided about the deal was that it would involve Russia taking in about 500,000 barrels of oil per day – fully half of what is allowable under the Joint Plan of Action. In turn, Russia may help Iran in further violating Western sanctions by reselling Iranian oil without disclosing its origin.

While all of this remains up in the air, or at least secretive, it speaks to the fact that Russian interests have a significant potential impact on Iran’s future. Payvand News published an analysis on Wednesday of some of Russia’s motivations specifically with regard to the Iran nuclear talks and the future of Russian sales of fissile material to Iran for use in nuclear power reactors.

On one hand, Russia may be anxious about the prospect of losing this market for its domestically enriched uranium in the event that Iran is allowed to keep the capacity to enrich large quantities on its own, and this may lead Russia to act against a final agreement. On the other hand, doing so would almost certainly imperil other economic relations between the two countries, including the prospect of Russia building two new nuclear reactors for Iran.

It seems safe to say that which side Russia favors in the nuclear talks will have a lot to do with what economic prospects it expects from Iran after a final deal is signed. This includes expectations related to oil exports and oil-related barter.


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