Iran News Update suggested on Tuesday that Iran’s reluctance to participate in plans to freeze oil output at January’s levels might be motivated in part by a desire to retaliate against OPEC’s previous unwillingness to cut production ahead of Iran’s reentry into the market. The report further indicated that Russia and Saudi Arabia appeared to be considering the possibility of offering special terms to Iran in order to entice its cooperation.
Specific plans had not taken shape as of Wednesday, but Iran’s notably open-ended commentary on the situation could be interpreted as deliberately leaving the door open for a favorable offer from OPEC and Moscow. The discrepancy in reporting about Iran’s views of the deal stems from the fact that Oil Minister Bijan Zanganeh specifically lauded the newfound cooperation but stopped short of declaring an Iranian policy that would actively support it.
This situation led Reuters to conclude that Iran remains a serious obstacle for the agreement, which would be the first between OPEC and a non-OPEC oil exporter since 2001. Russia has reportedly made it clear that universal cooperation – including cooperation from Tehran – is a prerequisite for the agreement going forward. But the initial reports on Tuesday indicated that it was unlikely that even the other OPEC members would maintain strict controls over output levels.
Furthermore, Reuters added on Wednesday that although Russia was a party to the similar 2001 agreement, the non-OPEC power failed to adhere the terms it had helped set. This historical context could make an agreement with Russia a more risky proposition, especially it is necessary for Saudi Arabia to offer special terms to its traditional rival Iran in order to secure that agreement.
But even in comments peripheral to the OPEC negotiations, Russia has urged improvement of relations between Iran and Saudi Arabia, according to the Middle East and North Africa Financial Network. Public comments from Iranian officials have portrayed that reconciliation as a step toward the unilateral action that is necessary to stabilize the global oil markets. But it is also possible that Moscow’s efforts are partially aimed at facilitating return to those markets for its global partner Iran.
That partnership apparently has been steadily deepening since some time prior to the conclusion of nuclear negotiations between Iran and the five permanent members of the UN Security Council plus Germany. And it has especially deepened in its military dimensions since September when Russia began carrying out bombings in Syria in support of Iranian-led and Iranian-supported forces fighting in defense of President Bashar al-Assad.
The cooperation in that fight and in other regional issues was reaffirmed on Tuesday in meetings between Iranian and Russia officials in Moscow. Iran News Update previously reported that Iranian Defense Minister Hossein Dehqan had met directly with Russian President Vladimir Putin to finalize plans for the delivery of Russian fighter jets, as well as to discuss other potential military shipments, including some that would violate UN restrictions on arms sales to Iran, which are set to remain in place until the nuclear agreement has been successfully upheld for five years.
On Wednesday, Pakistan Today added that Dehqan had also met with his Russian counterpart Sergei Shoigu as well as Deputy Foreign Minister Dmitri Rogozin. During those meetings, Shoigu declared, “I am convinced that our meeting is going to contribute toward reinforcing friendly relations between Russian and Iranian armed forces.” He also said that the two countries stand “ready to coordinate their approaches on a large number of global and regional issues.”
The ongoing expansion in cooperation will reportedly hit a new milestone on Thursday when the first advanced S-300 missiles will arrive in Iran from Russia, according to news sources the sale of these weapons was originally planned for 2011 but was stalled for years by global outcry before the nuclear negotiations gave Iran license to resume the transfer.
After a number of delays and false starts, the transfer appears to be in progress at least, possibly signaling that Russia now considers the benefits of partnership with Iran to outweigh the political consequences of arming a government that is known for its sponsorship of terrorism.
