Following the Kremlin’s recent announcement that it is shutting off the Nord Stream 1 pipeline, Europe faces a sharp increase in already-high energy prices. One possible way to ameliorate the situation not just for Europe but for the rest of the globe would be to lift sanctions on Venezuelan and Iranian oil. In the latter case, the renewed nuclear deal currently under negotiation would accomplish just that. But Oved Lobel argues that such efforts would be counterproductive:
Much of Venezuela’s energy industry has come under virtual Russian control over the decade, not only via Russia’s partnership with Cuba—which siphoned off [Venezuelan] oil in the late 1990s in partnership with Iran—but also through direct loans in exchange for oil and ownership interest in Venezuelan energy projects. Russia’s state-owned Rosneft and its boss, Igor Sechin, perhaps the second-most powerful man in Russia, almost singlehandedly kept the Venezuelan president Nicolas Maduro’s regime afloat, while Sechin himself regularly meets with Maduro and had a close relationship with his predecessor, Hugo Chavez.
Russia and Iran, meanwhile, have always had a sanctions-evading relationship, one set to deepen if the nuclear deal is revived. . . . Regardless of whether the reported $40 billion energy deal between Russia and Iran actually results in anything concrete, the two countries will continue to cooperate as much as compete in the energy sphere. In May, for instance, a Russian-flagged and -operated tanker carrying Iranian oil was seized by the U.S. off of Greece, although Iran then hijacked two Greek tankers in retaliation and Greece ultimately released the oil back to Iran.
What seems like realpolitik is therefore counterproductive. There is simply no way to compartmentalize these countries; the energy networks are too intertwined. Easing pressure on any of them will result in empowering all of them.
Read more on Fresh Air: https://aijac.org.au/featured/empowering-russias-allies-is-not-the-answer-to-the-energy-crisis/