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Reuters
Reuters
Business
By Mark Trevelyan

Explainer: What Putin wants from Iran and why Tehran might be cautious

Russian President Vladimir Putin attends a meeting with Turkish President Tayyip Erdogan in Tehran, Iran July 19, 2022. Sputnik/Sergei Savostyanov/Pool via REUTERS


A budding courtship between Russia and Iran is an unwelcome development for the West that the United States will watch with concern, but it falls well short of a geopolitical game changer.

Russian President Vladimir Putin used a rare foreign trip on Tuesday - his first outside the former Soviet Union since he launched the invasion of Ukraine on Feb. 24 - to hold talks in Tehran with Supreme Leader Ayatollah Ali Khamenei and President Ebrahim Raisi, as well as Turkish President Tayyip Erdogan.

But the fact that Russia and Iran are competing energy producers is likely to place limits on any deeper partnership, even though the two countries are united in their hostility towards the West.

Here's a look at some of the key questions that their developing relationship poses.

CAN IRAN HELP RUSSIA IN THE UKRAINE WAR?

U.S. officials have said Iran is preparing to help supply Russia with several hundred unmanned aerial vehicles (UAVs), or drones, including some that are capable of firing weapons, but neither country has confirmed it. Russian presidential aide Yuri Ushakov was quoted by RIA news agency as saying Putin had not discussed the issue with Iran's leaders.

"Russia deepening an alliance with Iran to kill Ukrainians is something that the whole world should look at and see as a profound threat," U.S. National Security adviser Jake Sullivan said last week.

Ukraine has used Turkish-supplied Bayraktar drones to lethal effect in targeting Russian units and destroying huge quantities of tanks and other armoured vehicles. Jack Watling, a war expert at the RUSI think-tank in London, said Iranian drones would be useful to Russia for both reconnaissance and as loitering munitions that can bide their time in locating and engaging suitable targets.

"Beyond supplying UAVs Iran can also help Russia evade sanctions and potentially collaborate on the manufacture of weapons systems that are less dependent upon supply chains through Western countries," he said.

WHAT CAN RUSSIA LEARN FROM IRAN ON SANCTIONS?

Iran has many years of experience of defending itself against Western sanctions over its disputed nuclear programme. "The Russians see Iran as being highly experienced at, and a potentially valuable partner, in evading Western sanctions," said Watling.

Russia, meanwhile, has been hit with waves of sanctions against banks, businesses and individuals over the war in Ukraine. Both countries therefore lack access to Western technology and capital, said Janis Kluge of the SWP think-tank in Berlin.

"There might be some lessons that Russia can learn from Iran... In exchange, Russia could offer military goods and possibly raw materials or grain," he said. Russia is already a major supplier of wheat to Tehran.

With some Russian banks cut off from the SWIFT international payments system, Moscow is developing an alternative in which Iranian banks could be included, Kluge said.

More broadly, Iran is part of a wider group of countries - also including China, India, Latin America and Arab and African nations - with which Russia is forging stronger ties in a bid to prove its claim that it can thrive under sanctions and that these will only rebound on the West.

HOW CAN RUSSIA AND IRAN COOPERATE ON ENERGY?

This is potentially a sensitive question: both countries are oil and gas producers, and competition between them has intensified since the start of the Ukraine war as Russia has switched more of its oil exports to China and India at knock-down prices.

"On the economic dimension, the war has significantly worsened their relationship. Moscow is eating Tehran’s lunch in commodity markets and has even fewer resources to throw at projects in Iran," said Henry Rome, deputy head of research at Eurasia Group.

Coinciding with Putin's visit, however, the National Iranian Oil Company and Russia's Gazprom signed a memorandum of understanding worth around $40 billion under which Gazprom will help NIOC develop two gas fields and six oil fields, as well as taking part in liquefied natural gas (LNG) projects and construction of gas export pipelines.

WILL ANYTHING CHANGE IN THE IRAN NUCLEAR TALKS?

The Ukraine war has changed Moscow’s approach towards talks on reviving the 2015 Iranian nuclear deal, known as the JCPOA.

Eleven months of talks to restore the deal, which lifted sanctions on Iran in return for curbs on its nuclear programme, had reached their final stages in March. But they were thrown into disarray over a last-minute Russian demand for written guarantees from Washington that Western sanctions targeting Moscow over its invasion of Ukraine would not affect its trade with Iran.

Although Russia quickly retreated under Iranian pressure, diplomatic momentum for an agreement was lost. The talks have stalled since then over various remaining issues.

Whether the deal can get back on track will be one measure of the impact of the rapprochement between Putin and Iran's leaders.

"Russia’s interference in the JCPOA talks was a significant reversal of the traditional Russian approach and probably further fanned suspicions in Tehran about Moscow’s reliability and trustworthiness," said Rome of Eurasia Group.

(Additional reporting by Parisa Hafezi; writing by Mark Trevelyan; editing by Jonathan Oatis)

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