Despite the harsh sanctions imposed on it by the United States and United Nations, Iran continues to steadily accumulate geopolitical clout. Many commentators point to the fact that the cascading series of revolutions in the Middle East has given the region's Shiite communities, which are allied with Iran, greater influence. But even more important is Tehran's recent success in strengthening its role as an indispensable international energy supplier. By focusing on financial sanctions rather than the Islamic Republic's plans to become a global energy superpower, Washington policymakers have enabled Iran's rise.
Hundreds of millions of people are dependent on Iran for their energy. But while the West tends to associate Iran with oil, of which it is the world's fourth-largest producer, Iran's real power derives from its vast natural gas reserves, which are second only to Russia's. Driven by technological breakthroughs in the United States and demand in China and elsewhere, natural gas is already ascendant as a source of energy for power generation that is substantially cleaner than the old standby coal; in a post-Fukushima world, it is likely to be second to none.
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The international natural gas trade is different from those in oil and coal in that natural gas is for the most part delivered by an expensive pipeline infrastructure, rather than by more malleable sea routes or rail lines. This means that once an importer enters a long-term contract with an exporter, the relationship becomes all but unbreakable -- if Western Europe gets sick of dealing with Russia, for instance, it can't just pick up its pipeline and drag it over to North Africa. This is a big advantage for politically unpopular exporters, which explains why in recent months Iran inked gas deals with all of its seven neighbors, except Afghanistan. In doing so, it hopes not only to become a critical transit country for Central Asia's energy, but also to ensure that Europe and South Asia are beholden to its gas for many years to come.
In June 2010, Iran and Pakistan signed the final deal for a connecting pipeline that would carry 21.5 million cubic meters per day of natural gas. Both countries hope to extend the pipeline into either India or China, enticed by the prospect of millions of dollars in transit fees. If this happens, Iran would gain an economic lifeline -- and enjoy diplomatic protection from three Asian giants. If New Delhi refuses to extend the Iran-Pakistan pipeline into its territory, Tehran has a backup passage to India, via Oman. In 2008, Iran and Oman agreed to develop jointly Iran's offshore Kish field. Meanwhile, Oman and India are negotiating a deep-water pipeline that would bring Persian Gulf gas to India across the Arabian Sea. Should this project come to fruition, Iran's gas will undoubtedly provide the lion's share of the piped product.
No less important for Iran is the European market. Here, Iran is trying to position itself as an alternative to Russia -- which supplies a quarter of Europe's natural gas -- as a major exporter to the European Union. Europeans have been acutely aware of their vulnerability: Five years ago, a spat between Russia and Ukraine -- through which 80 percent of Russia's natural gas exports to Europe travel -- disrupted supplies to Hungary and Poland. Ever since, they have tried to establish a range of Plan Bs for gas delivery. Chief among them is Nabucco, a pipeline that aims to bring gas from the Caspian Sea to the heart of Europe by way of Turkey, Bulgaria, Romania, and Hungary. Iran wants to ensure that no matter which new corridor to Europe is chosen, its gas will be fed into it. For this, Iran needs to be fully integrated into the gas pipelines of its relevant neighbors: Azerbaijan, Syria, Turkey, and Turkmenistan.
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