Iran and the four countries bordering the Caspian Sea, as the largest holders of gas resources in the world, gathered last week at the second Caspian Economic Conference in Moscow, while the hard winter of Europe is coming and the crisis of the war in Ukraine has exacerbated the troubles for gas consuming countries.

Balanced energy diplomacy in the 13th administration was activated this time on the shores of the Caspian Sea, and it was able to achieve favorable results during constructive negotiations through the active diplomacy of the last year and lay the groundwork for the deep development of relations with the countries of the Caspian basin.

In the 13th administration, efforts are being made to change the direction of foreign relations from the west to the neighboring countries and the region, and "balanced diplomacy", "regionalism" and "development of economic diplomacy" are considered as the three principles of the administration's planning, so that maximum protection of national interests should be done.

Today, it is clear that the geopolitical region of the Caspian Sea is the most important region in the world energy market in terms of hydrocarbon reserves. The Caspian Sea, with its abundant hydrocarbon reserves, is among the three most energy-consuming regions in the world out of the four regions, along with China, Europe, and India, and the fact that Iran today is determined to develop activities and operations in the South Caspian region shows that the timely policy of the Islamic Republic of Iran and investment in creating infrastructure is necessary.

Mohammad Mokhber, the first vice president who represented Iran at the second Caspian economic conference in Moscow, stated: “The Caspian Sea, as a joint heritage and a center of connection between us, provides a very suitable basis for expanding cooperation in various fields between the coastal countries of this sea. In line with the foreign policy of the 13th administration, the Islamic Republic of Iran seeks to expand all-round cooperation with neighboring countries, especially with the Caspian Sea littoral states, and due to its geopolitical and geoeconomic position as the connection point of the Caspian Sea to the southern shores and warm waters of the Persian Gulf, the Oman Sea and the Indian Ocean, it is determined to stimulate economic and commercial cooperation between the coastal countries of the Caspian Sea.”

In the first five months of the calendar year of 1401 which began on March 21, exports to Azerbaijan have increased by 84%, and exports to Russia have increased by 31% compared to the same period last year, and exports to Turkmenistan have also increased by 40%. In the export development that has taken place in this period, the items of the country's export basket have also changed, which means that from the traditional export, which generally included agricultural products and fruits and vegetables, to industrial goods such as catalysts, oil and gas field equipment, turbines, compressors.

Perhaps the biggest achievement of Iran's presence in this conference was breaking the taboo of passing through the West and paying attention to the region in line with national interests. The 13th administration has tried to prove this important fact in the last year that the whole world is not limited to the West and that the independent countries of the region can move away from the excesses of the United States in the way of their economic independence.

After the Persian Gulf and Siberia, the Caspian Sea is the world's third source of energy, a matter that clearly shows that the Caspian Sea, in addition to its geopolitical location, is very important for the countries bordering the Caspian Sea in terms of oil and gas reserves. The visit of the first vice president to Moscow and his attendance at the second meeting of the Caspian economy, due to the special conditions of the world today, the crisis in Ukraine and the challenges in the world economy are of particular importance.

The fact is that at the Caspian Economic Conference, countries that have the largest share of the world's gas sat around a table, and the result of this meeting is important and worthy of reflection for Europe, which is approaching winter. These crises can also be the cause of the economic planning of the Caspian border countries.

It is expected that the expert negotiations between the countries along the Caspian Sea will be completed by December, and the relevant agreement will be signed both from a legal point of view and in terms of the goods, discounts and zero tariffs, and then it will be presented to the governments and parliaments of the countries for approval to witness the first regional free trade zone that will open up a $600 to $700 billion market for Iran’s industry and trade because it has an advantage in many goods that these countries import and by reducing tariffs we can easily compete in these markets and gain good shares.

Iran Proposes to form Caspian Energy Committee

The five Caspian Sea countries, as the largest holders of gas resources in the world, gathered in Moscow while the hard winter of Europe is coming and the Ukraine war crisis is very effective in this difficulty. In this meeting, the Islamic Republic of Iran tried to create the greatest cooperation in the field of energy and fuel among countries.

Iranian Minister of Petroleum Javad Owji, who traveled to Russia with the First Vice President and the Iranian delegation to participate in the second Caspian Economic Forum, on the sidelines of this forum, referred to the cooperation between Iran and Russia in the field of energy, saying: “Transit and swap of oil and gas from Russia can turn Iran into the regional hub for energy and the country will receive a lot of hard currency income.”

At the Caspian Economic Conference, Iran presented its fourth proposal for the development of cooperation in the energy sector and put the option of forming the "Cooperation Committee for Oil, Gas and Petroleum Products of Caspian Sea Countries" on the table.

The countries represented in the conference emphasized the increase of oil and gas swaps and commercial settlements based on national currencies and the connection of the banking network. During the last year, the trade of the countries along the Caspian Sea has increased by about 30%. One of the main points emphasized in this trip was the increase of oil and gas swap between the countries on the shores of the Caspian Sea.

According to Ehsan Khandozi, the Minister of Economy and Finance, agreements were made between the Minister of Petroleum of Iran and the authorities of Russia and Kazakhstan in the area of ​​increasing swaps.

Reasonable and fair exploitation of the oil and gas reserves of the Caspian Sea was also one of the other focus points in this conference, and cooperation in the field of energy can be effective in the fight against sanctions. But this is not the whole story in the field of energy, and Iran's geopolitical position highlighted the issue of energy swaps in the discussions of this forum.

Previously, during the meeting of ECO member countries in Turkmenistan, Iran signed a gas swap agreement with this country and the Republic of Azerbaijan, which is considered possible to repeat with other members of the Caspian Sea Organization Kazakhstan, Turkmenistan and Russia will be a good way to transfer gas, oil and petrochemical products.

Iran; Regional Energy Hub

According to the minister of petroleum, the transit and swap of oil and gas from Russia will make Iran the hub of the region in terms of energy and the country will receive a lot of hard currency as income. As gas exporting countries, Iran and Russia have cooperated a lot in the field of energy swap. The planning of the two sides to cooperate in the development of the North Pars and Kish fields and the creation of pressure boosting facilities in the South Pars field which is an important issue for Iran; in the field of gas export to Pakistan and Oman, memorandums of understanding have also been signed and construction of the export pipeline to these two neighboring countries will be done jointly by Iran and Russia.

The swap of petroleum products such as gasoline in the Caspian Sea and the exchange of non-petroleum items with oil can be done with regard to the equipment of ships and ports and docks between the two countries, and it gives the two countries the ability to swap up to 10 million tons of petroleum and non-petroleum products per year.

Iran's cooperation with the countries of the Caspian basin will be strategic in the matter of oil, gas and energy, and it seems that the swap agreement and the purchase of 15 billion cubic meters of gas through Turkmenistan will be completed within the next few weeks. The cutoff of Russia's gas exports to Europe and the change in international conditions have made Iran able to be a bridge for the transfer of Russian oil and gas products to other countries and become the gas hub of the region.

In August 2018 and at the same time as the first anniversary of signing of the Convention on the Legal Status of the Caspian Sea, the countries of the Caspian Sea gathered in the "Avazeshahr" tourist area of ​​Turkmenbashi, Turkmenistan, to participate in the first Caspian Economic Conference. The second Caspian Economic Conference was a great opportunity for Iran to plan for a market as big as $600-700 billion and to use the facilities of this field to reduce the effects of sanctions and to use the capacities of the region to bypass sanctions.

Iran, as the north-south corridor and the most important passage and connection point of these countries to high seas and East Asia, due to its geopolitical importance, can encourage the countries present in this economic forum to invest in the field of transportation and development of rail and sea fleets.