Russia Profits from the Iran Nuclear Standoff

This article was written by YPFP member Ryan R. Miller. It was first published in Central Europe Digest on June 16, 2008.

Senator Charles Schumer penned an op-ed in The Wall Street Journal on June 3 entitled “Russia Can Be Part of the Answer on Iran.” To buy Russian support for tougher sanctions on Iran, he argued, the United States should scrap missile defense installations in Poland and the Czech Republic, and basically acquiesce to Russian hegemony in the Caspian Sea region (a potential alternative source of energy for Europe).

So in less than 750 words, Schumer managed to confirm the nightmare scenario of a number of former Russian satellites that are now U.S. allies: under the right circumstances, Washington might be tempted to bargain away the security interests of “New Europe” in the face of “new threats” requiring Russian assistance.

The New York Senator is not the only U.S. politician to explore ways of “accommodating” Russian interests on Europe’s periphery as part of a diplomatic deal over Iran. Congressman Brad Sherman, for instance, has hinted that the United States should turn a blind eye to Russian interference in Europe’s frozen conflicts. At a congressional hearing last week, Sherman appeared to criticize the Bush Administration for not modifying U.S. policy on items like Abkhazia, South Ossetia and Transnistria in order to get the Russians to play ball on Iran. “This is self-imposed powerlessness,” he complained. Moving forward, there will likely be voices inclined to sacrifice Ukraine’s NATO membership bid as the price of winning Kremlin support.

But such thinking is not only short-sighted and immoral, it is also naïve. For arguing that Russian diplomatic support is somehow a silver bullet to the Iran issue obscures an important fact: Russia, to a certain extent, profits from the West’s ongoing standoff with Tehran, and thus may not be so easily tempted by any of these grand bargains.

Russia benefits by exploiting current tensions to solidify its control over Europe’s energy sector. In line with Kremlin aspirations to restore its sphere of influence, Gazprom – the Russian state-owned gas giant – is working to shore up its monopoly over Europe’s natural gas supplies. Energy dominance over European nations is a top foreign policy priority for today’s Russia. The new Russian President, Dmitry Medvedev was until recently Gazprom’s Chairman, suggesting that the interests of Gazprom and the Russian state will continue to go hand-in-hand.

Iran, though an international pariah, holds the world’s second-largest gas reserves and could offer Gazprom some competition – if Western oil and gas majors developed these deposits. But the nuclear crisis, and sanctions against U.S. and EU companies doing business in Iran’s energy sector, puts any Russo-Iranian gas competition on ice. Just recently, Royal Dutch Shell said it was backing away from an investment in a major Iranian gas field in order to avoid being sanctioned.

In practice, new pipelines that would bring non-Russian supplies to Europe might not get off the ground without access to Iranian gas or Turkmen gas exports via Iranian territory. So long as Iran is boxed in, Russia can dominate European energy flows and employ such commercial dominance to regain its long-lost political clout.

Because of Russia’s ambiguous set of interests, Washington should be careful of relying too heavily on Moscow for solving the Iran conundrum. Besides, getting Russia to coerce Tehran anytime soon is probably wishful thinking; Russia cannot play the role that China did with respect to North Korea because it does not have the same level of influence. True, Russia could be less obstructionist in the UN Security Council, but Russian diplomats will only go so far. After all, maybe some in the Kremlin don’t want things to get better. Think about it: if the West brought Iran to the negotiating table, reached an understanding with the Mullahs on the nuclear issue, and offered EU energy markets as a reward (which certain Europeans would like to do), then Gazprom cabals could stand to loose out.

So far, Moscow is content to dabble in multilateral sanctions without actually doing anything that might push Tehran in a new direction. In practice, Russian support in the UN effectively means watered-down resolutions and a perpetuation of the status-quo. From Gazprom’s perspective, this is a comfy arrangement since it keeps Central Europe over a barrel in the game of energy geopolitics. Senator Schumer and those like him would do well to remember this point.

Ryan R. Miller is a research analyst at the Center for European Policy Analysis (CEPA).

The views expressed in this article are those of the author and do not necessarily reflect the opinions of the Center for European Policy Analysis.

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In response

Agreed, ceding the Caspian to Russia while simultaneously reneging on missile defense to the Czech Republic and Poland would be a rather difficult pill to swallow. However, given the circumstances, doing nothing about Iran's nuclear program (as you've laid out in your post) is not a particularly useful endeavor either.

Given Russian cooperation on their (Iran's) nuclear program, the chances of diplomatically solving this dilemma without some kind of Russian help is going be quite a challenge indeed.

The question vis a vis Russia on the Iranian nuclear question needs to be: what is necessary to U.S. interests in the region, and what is not? Already we have made mistakes that have weakened our leverage with the Russians: Ukraine, with a majority of its citizens against NATO membership was always a mistake. Georgia with an autocrat running the country and constantly taunting the bear was always a mistake. Kosovo, where neither the EU nor the US has the will necessary to keep thousands of years of hatred at bay was always a mistake. And now missile defense whose stated purpose is against a supposed threat (Iran) that neither has the weapon nor the capability (and I would add the willingness) to strike Europe...IS a mistake.

As for the Caspian...That is something that the U.S. (and Europe) does need. However, the Caspian region is not in our backyard, and as such, we must accept the reality that the Russians must be dealt with over that issue.

Unfortunately, because we have finite power and finite influence, we cannot always get what we want. But without quoting Mr. Jagger any further, the key is understanding what it is that is absolutely necessary towards meeting our interests. Currently an Iranian nuclear weapon (and the proliferation consequences that stem from that) is of far greater concern to the national security interests of this nation than placing an unproven missile defense site/additional tripwire in the backyard of our New Europe(an) friends. While capitulating on this issue may not matter given that it is nearly the only card we still hold, the key is to learn from episodes such as this that once you lose site of what is vitally important, the consequences to the citizens of this country can be disastrous.

Submitted by William L T Schirano on June 20, 2008 - 12:00pm.