Journal Essay

Turkish-Iranian Energy Cooperation and Conflict: The Regional Politics

H. Akin Unver

Summer 2016, Volume XXIII, Number 2

Dr. Unver is an assistant professor of International Relations at Kadir Has University in Istanbul.

The outcome of the March-April 2015 nuclear negotiations between Iran and the P5+1 (China, United Kingdom, France, Russia, United States, plus Germany) increased economic and trade optimism towards easing of sanctions on Iran. This optimism had a strong energy dimension in Europe, as the EU has long been scrambling to find alternatives to its dependence on Russian gas.1 While individual EU members have been looking after their national energy interests, a common EU energy policy has not been forthcoming.2 For its part, Turkey has long been supportive of pipeline projects that would strengthen its bid to emerge as the region's energy-transit hub and prioritized this as a main foreign-policy goal.3

In exporting Iran's gas to Europe, LNG transit is the most immediate option. However, given the increasingly violent Saudi-Iranian rivalry in Yemen, LNG transit through Aden will likely be problematic in the short term.4 Also, in order to render the Iran deal politically meaningful, with the prospect of opening up Iran to world markets more sustainably, construction of an Iran-Europe pipeline seems more strategically sound. Among possible Iran-origin pipelines was the proposed "Persian Pipeline," which would connect Iran's South Pars gas field with European markets through Turkey. In Iran's westbound pipeline options, Turkey is difficult to overlook, with an already existing natural-gas pipeline infrastructure and another major project — the Trans-Anatolian Pipeline (TANAP) — already underway as a future connector.5

Both Turkey and Iran see themselves as critical energy hubs — Iran exporting oil and gas to the eastern markets of Pakistan, India and China, and Turkey sending Middle Eastern and Central Asian gas to Europe. Iran has an important advantage: as a producer and potential large-volume exporter, it is less vulnerable to political pressures from large-volume importers; Turkey has to balance the political pressures of buyers. Nonetheless, Iran's eastern export options fall short in terms of infrastructure financing options, long-term pipeline security and pricing transparency. Thus Tehran has been looking with more favor towards European options.6 This means that Turkey will grow increasingly relevant in the post-sanctions period in planning for the export of Iran's gas. However, there are significant political and strategic disagreements between Ankara and Tehran that need to be smoothed out before any agreement can be reached on exporting and transporting gas from Iran's South Pars field.

ECONOMIC DYNAMICS

Turkish-Iranian rivalry and cooperation have been fundamental structural dynamics of the Middle East since Shah Ismail I proclaimed the Safavid Dynasty in 1501 and united all Persia as a Shiite empire in 1509. Since then, the main ideological poles in the Middle East have been the Shiite Safavid Empire and the Sunni Ottoman Empire, fighting direct and proxy wars to expand their respective Islamic ideologies. Despite these conflicts, however, Ottomans and Safavids continued to trade, mainly through Armenian and Arab merchants who oscillated between the Hamadan-Antioch and the Baghdad-Tyre-Aleppo routes along the western end of the Silk Route.7 Both empires learned to fight and trade simultaneously, without war necessarily restricting the flow of merchandise.

It was only after the Treaties of Erzurum in 1823 and 1847 that the Ottomans and Persians (the Qajar dynasty after 1789) finally agreed to recognize each other as autonomous parts of the world ummah and enter a period of relative stability. Despite this, religious-ideological differences prevented both empires from rising above mutual mistrust.8 Not until the 1930s were the two able to expand and deepen their cooperation, largely due to the similar secular-modernization ideologies of Turkey's Mustafa Kemal Ataturk and Iran's Shah Reza Pahlavi. Momentum built through the marginalization of sectarian and historical differences, and through secularism, led to the unprecedented Treaty of Friendship in 1926, a definitive border treaty in 1932 and a nonaggression pact in 1937.

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