How Iran benefits from a ‘New Cold War’

How Iran benefits from a ‘New Cold War’

With a ‘New Cold War’ between the U.S. and Russia seemingly in its early stages, Iran has much to gain from the conflict by playing both sides.

Remember when Iran was declared part of the so-called ‘Axis of Evil’? Remember when bombing Iran to take out its nuclear facilities was an inevitability rather than mere speculation? Remember when any negotiation over Iran’s nuclear program was unthinkable?

It seems priorities have shifted given Russia’s geopolitical ascendance. With a ‘New Cold War’ gradually evolving into a conflict between West versus East, Iran is turning into a valuable asset that has the potential to tilt the balance. Not surprisingly, Iran knows this all too well.

Empowering the Southern Gas Corridor

In U.S. attempts to thwart Russia’s access to the European gas market, the plan is to bring gas from Azerbaijan’s Shah Deniz II gas field to the Turkish-Greek border through the Trans-Anatolian Pipeline (TANAP) and then connect it to southern Europe through the Trans-Adriatic Pipeline (TAP).

This so-called Southern Gas Corridor is expected to bring 10 billion cubic metres of gas to southern Europe, which is not much considering Russia’s planned South Stream pipeline will send close to 63 billion cubic metres.

In a largely unreported story, Iran is considering transporting natural gas through TANAP. This would have the potential to significantly increase gas supply into Europe, thereby contending with Russia’s South Stream. After all, Iran holds the largest proven natural gas reserves in the world.

In a more shocking development, Iran is also considering reviving the all-but-dead Nabucco pipeline that was initially rejected by the Shah Deniz consortium in favour of the TAP/TANAP project. The Nabucco pipeline would compete directly with the South Stream route and would provide greater capacity than the TANAP/TAP project. If both projects become a reality, they could effectively end Russia’s hold on the European market.

The battle for Iraq

The current U.S. campaign in Iraq against Islamic State (IS) militants coincides with Iranian interests. A militant Sunni army rampaging through Iraq like a Mongol horde is sure to make Iran nervous. A break-up of Iraq into Sunni, Shiite and Kurdish regions could mean the end of a potential pliant Shiite state on Iran’s border.

Securing Iraq as a united entity is in Iran’s best interest. Joining the American effort against Islamic State fighters would bring Iran and the U.S. toward a similar objective, but ousting Iraqi Prime Minister Nouri Al-Maliki in the process promises to tie them even closer.

Maliki’s need to assert his independence and unwillingness to follow American diktats made him an effective Iranian client, but also a prime candidate for being disposed. Given the situation on the ground, Iran has no choice but to seek a change that will hold Iraq together.

With Maliki on his way out and Bashar al-Assad fighting for his political life, two of the three leaders included in the  Iran-Iraq-Syria pipeline agreement are now out of the equation that would prevent Europe from falling into Russia’s sphere of influence.

Israel and Kurdish oil

Iraq’s Kurdish region produces 10 percent of Iraq’s total output, and Israel is a benefactor, having accepted its first deliveries in June. With the Leviathan gas field still in development, Israel requires energy imports to avert a potential energy crisis.

It is no surprise that Prime Minister Benjamin Netanyahu has publicly stated his support for an independent Kurdistan. A thriving Kurdistan means that oil shipments continue into Israel, and the only way to maintain this arrangement is to thwart any threats against it. Israel recognizes that Iran’s help in defeating the IS threat is paramount to continued energy security and has therefore calmed its rhetoric against Iran for now.

Iran’s double game

While potentially reaching out to gain favour with the West, Iran has been careful not to alienate its Russian strategic ally. Iran’s support of Assad in Syria is steadfast along with its patronage of Hezbollah. More recently, Iran and Russia signed a historic oil deal worth $20 billion and are also working together towards “de-dollarization” of the U.S. dollar.

With Iran having stakes in both sides of the conflict, it is not only sheltering itself from political isolation, but also creating opportunities for itself in the process.


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Aurangzeb Qureshi

Aurangzeb Qureshi is the editor of and a freelance foreign affairs writer based in Canada. He focuses on energy geopolitics in the Middle East, South Asia and Central Asia. Follow him on Twitter @aqureshi80.