Emerging Importance of the Caspian Region in Tehran – Moscow Relations

Samra Sarfraz Khan*

The Caspian Sea holds a sizeable amount of natural reserves, significant among them being oil and gas. The beginning of the twenty first century showed remarkable results in the economic growth of developing countries. The leading economies in this regard were China and India. As more countries have turned to industrial mode of production for competent economic progress, the importance of energy sector in global economic affairs has increased more than just substantially. The leading as well as the developing economies of the world intend to keep a maximum stash of energy supplies at their disposal to keep up with the energy race that so determines the international standing of the world communities. It is for the same reason that the international actors are showing increased interest in the Caspian basin.
In view of the security conditions in the resource-rich Middle East, there has been a sharp increase in the tendency to depend on the supply of hydrocarbons coming from the Caspian region. As the multinational interest, and the threat of reserve shortage in the region continues, so will the intermingling of common goals and objectives of the regional and extra-regional characters. As a matter of fact, during the past few years, the world has witnessed a serious struggle among the regional and non-regional actors for the maximum control of reserves. Ironically enough, the ideological and political differences among the key actors of this struggle have made the geopolitics of the region all the more complicated.
The Caspian Sea, located towards the north of the mountainous range of Alburz (in North Iran); rich in oil and gas resources has an equally rich history going back thousands of years. Various ancient scriptures and documents make a mention of the region with different names, thus adding to its significance. For many centuries, the Caspian Sea or the Caspian Lake remained influenced by the Persians and Russians. Persians accessed the waters through their northern shores. Even after the Arab conquest of Persia in the seventh century, the northern states of Persia remained under the rule of the local noble families that traced their origin back to the Sassanid or the pre-Islamic era. This together with the fact that north Persia is bordered by the Alburz Mountains in the south; northern Persia or shomal often remained aloof from the southern half of the state. Therefore, the Caspian shores during this time were cruised by traders and merchants from northern and western Europe through the Volga River. It was only in the sixteenth and seventeenth centuries that the states in the north were brought under Persian rule by the Safavi Dynasty. The decline of the Safavis in the eighteenth century was parallel with the expansion of the Russian Empire particularly in the south where the realm met the Persian northern towns of Mashhad in the south-east and Tabriz in the south-west.

The Historical Setting

By the early years of the eighteenth century, when the strategic importance of the Sea was recognized by the littoral states; a struggle for the control of Caspian Sea and its adjacent territories ensued between Russia and Persia. By the consequent Treaty of St. Petersburg (1723), Persia ceded, among other parts of the empire, the areas of Baku, Mazandaran, Gilan and Astarabad to Russia. With this treaty, Persia had actually accepted Russian dominance in the region and in the Caspian Sea. In the coming years, Russia maintained a steady advance of conquests and by 1820s, Makhachkala, Derbent, and Azerbaijan were included in the Russian Empire. Turkmenistan was added to the empire in the later years of the nineteenth century. The Turkamanchai Treaty of 1828 dissolved Persian navigational rights in the Caspian Sea. Therefore, from the eighteenth century, and through the nineteenth and twentieth centuries, Russia remained the major player in the Caspian Sea region. Nevertheless, with the establishment of the Bolshevik regime in Russia, a new treaty, namely the Treaty of Friendship was signed between the two parties in 1921. This treaty restored Iran’s shipping rights in the Caspian Sea. But Russia still remained the major player in the Sea, which unlike Iran, maintained a naval force while Iran limited its activities to the southern shores of the sea. During this time, the major economic activity in the region was fishing (particularly of Caviar) in which both Iran and Russia were equally involved.
The major part of the twentieth century witnessed the Caspian Sea being governed majorly by the bilateral treaties between the USSR and Iran. However, things changed drastically with the dissolution of the Soviet Union and the emergence of independent states in Central Asia in 1991. This also increased the number of littoral states of the Caspian Sea from two to five; namely, Russia, Iran, Azerbaijan, Kazakhstan and Turkmenistan. The question of whether the Iran-USSR treaties would continue to regulate the Caspian Sea and the littoral states, and whether the former treaties are equally binding on the newly formed states was approached differently by the littoral nations. Iran and Russia maintained that since the legal status of the sea had not changed, therefore it should continue to be governed by the treaties of 1921 and 1940 between Iran and USSR. However, with the passage of time, as the potential of the sea in terms of its oil and gas reserves was realized, some states, particularly Azerbaijan and Kazakhstan started demanding a division of the sea for the offshore exploration of hydrocarbon reserves from their shores. Unfortunately for Iran, as the political pressure from western circles increased on Moscow, the latter shifted its stance on the Caspian Sea from pursuing a division of the sea to allowing a division of the seabed among the Caspian states. Consequently, in 2003, Russia, Azerbaijan and Kazakhstan agreed upon a division of 64 percent of the seabed amongst themselves whereby the three states got 19 percent, 18 percent and 27 percent share respectively. As Iran and Turkmenistan refused to be signatories of the agreement, therefore, exploration could only take place in the northern Caspian Sea. Since this agreement, the relations of Tehran with other Caspian States have been of critical importance in international politics with the future status of the Caspian Sea being the central question in Iran’s Caspian politics. In this regard, Iran’s relations with Azerbaijan and Russia are interrelated and have a deep influence on the Caspian region.

Iran’s Interests in the Caspian Basin

As a matter of fact, the question of Caspian Sea has been the basic element in designing Tehran’s relations with the Caspian States. Iran is one of such countries where oil dominates an important section of the overall economy. In1996-97, oil, gas and energy constituted about 17.6% of the country’s GDP. According to the US Energy Information Administration, Iran has the advantage of housing world’s fourth largest oil reserves and second largest natural gas reserves, while it is also the second largest oil producer within the OPEC. In the same light, the Caspian region too is known for its potential in the energy sector. Iran saw the independence of the Soviet republics as an opportunity to reassert its historic influence in the region, create the much sought after Islamic bloc and to extract maximum benefits from the energy rich region.
Iran has a regional share in the Caspian with the province of Gilan towards the west and the province of Mazandaran in the east, that is, a total of 61,645 square KM area. The coastline between the Alburz mountainous range and the Caspian Sea extends to 657 KM and the country’s best agricultural lands are constituted in the region, which accounts to approximately 40% of the country’s net economic activity. The policy of achieving self sufficiency in food production makes the region all the more important for Iran. This region produces tobacco, citrus fruits, rice, wheat, barley, tea and vegetables of very fine quality. The presence of ‘fine soil, low salinity water and an average rainfall of 200mm’ also contribute to the production of fine quality agricultural products.
The fact that 25% of Iran’s forests are located in the Caspian region further makes it an extremely important area in the country’s policy making framework. The fauna of the region forms another substantial part of Iran’s economy. According to an estimate, the fauna in the Caspian region is of 114 different species plus 63 sub-species of fish. From an economic point of view, the most important fish variety is that of sturgeon from which can be extracted not only flesh but also roe and caviar. The annual income from caviar trade increases by $50 million annually. This makes sturgeon or caviar a chief non-oil export of the country. Around 90% of the world’s caviar production comes from the Caspian Sea with Iran being second to Russia in the supply of the product to the international market. Another important fish type is that of kilka. Shilat, the state-owned organization that has most of the fisheries management to itself, has played an important role in using kilka for fish-powder production. The number of Iranians employed in the fish sector of the Caspian region is thereby increasing steadily.

Along with the agricultural and fishery sector of Iranian Caspian region, the region boasts some important industries including food, textile, wood, paper, chemicals, machinery and mining. The mining sector hosts marble, bauxite, limestone, zinc, coal and lead, contributing about 10% in the country’s overall mining output. The Caspian region itself is one of the world’s largest hydrocarbon reserves (third after Persian Gulf and Siberia). Iran started its first exploration project in the region in 1996 and is not only in a position to conduct exploration for meeting its own needs but it can also assist other interested countries by offering technological aid.
Iran also wants to develop its Caspian ports in view of the Caspian Sea serving as a transport route to the littoral states. Ferryboat services connect the ports of Baku, Dagestan, Astrakhan, Aktao, Guriev, Turkmenbashi, Aktash, Nowshahar and Anzali. The Caspian Sea is also linked to the Black Sea via Volga-Don Canal in Russia. The latter has huge economic significance for Iran as it connects her with Europe and reduces the transport duration to up to ten times. Since the demise of Soviet Union, Iran has increased its load on the Caspian ports of Nowshahar and Anzali. For example, in 1976, the amount of goods discharged at Anzali and Nowshahar were estimated at 338,000 tons and 118,000 tons respectively, which increased to 2.2 million tons and 1.6 million tons respectively in 1996. Iran also seeks to take leading stake in laying down pipelines and becoming the main route for the export of Caspian oil. The Neka-Tehran link and the Tehran-Tabriz pipeline are some examples of Iran’s interest in the pipelines. Most of Iran’s oil reserves lie in the south of the country. The oil demand in the north of Iran, where the majority of Iranians live, has to be pumped there through pipelines passing through the desert terrain. The procedure is costly and complicated. Alternatively, Iran can transport oil from Kazakhstan to the Iranian port of Neka where it would be processed in oil refineries. In return Kazakh tankers will take crude oil from the Iranian ports in the Persian Gulf to be delivered to markets around the globe. This would simultaneously reduce Kazakhstan’s dependency on expensive pipelines and satisfy Iran’s oil demands in the north. Any other planned route via Russia, Afghanistan or the Caucasus cannot be as cost-friendly and as shorter than the Persian route; as even the “American oil executives concede privately.”
The Caspian Sea is geographically divided into three basins; North, South and the Middle Caspian Basin. The dominant hydrocarbon element in the Southern Basin is gas; that in the North is oil while Middle Basin is of relatively lesser importance.The closest market to Caspian gas is Turkey whereas Caspian oil can access global market through variable routes. The countries lying towards the east of the Caspian, such as, China, Pakistan, Japan and India would seek to reduce their dependence on Middle East oil by approaching shorter and more cost-friendly Caspian oil. Russia leads the littoral states for the export of regional hydrocarbons to the international community. As for the west, it would rather acquire the region’s exports through routes that would exclude both Russia and Iran. This would undermine Russia’s place in the regional geopolitics as it has been a traditional player not only in the Caspian region but also in Eastern Europe. The Clinton administration was in favor of using the Baku-Tbilisi-Ceyhan Export oil pipeline (BTC) and the Trans-Caspian Gas Pipeline (TCGP) for the access to Caspian hydrocarbons. On the other hand, Russia has been developing another pipeline with the name of the Blue Stream. Iran has also involved itself in the transport as well as the exploration of oil and gas particularly in its section of the Caspian Sea which happens to fall in the Southern Basin. Furthermore, Iranian National Oil Company (INOC) has a share of 10 percent in the Azerbaijan International Oil Company (AIOC) and has also shown its willingness to cooperate in Chinese led investment in the region.
As a matter of fact, various international companies have entered the Caspian region since 1991. The first important agreement was made in 1993 by Chevron, an American multinational energy cooperation, with KazMunaiGaz; the national oil company of Kazakhstan. Also the Kashagan oil field in Kazakhstan, believed to be the world’s largest oil field outside the Middle East, is being developed jointly by international companies such as Shell, Total, Eni, Conoco Philips and Exxon Mobil. In 1994, the British Petroleum company (BP) entered into a thirty years Production Sharing Agreement (PSA) with the AIOC for the development of the three oil fields in the Azeri sector of Caspian Sea.
In order to undermine Russian and Iranian influence in the region, which are respectively the first two leading players in Caspian politics; USA along with Turkey has been advocating the Baku-Tbilisi-Ceyhan (BTC) transport route for Caspian hydrocarbons, considered to be the most expensive trade route for Caspian oil so far. It carries oil from Baku in Azerbaijan, to the capital city of Tbilisi in Georgia and to the Ceyhan port of Turkey in south Mediterranean. In order to make it cost friendly, oil from Kazakhstan must also be pumped through this route in addition to that of Turkmenistan and Azerbaijan. But the Kazakh leadership, in view of cost expenditure, is rather inclined towards an alternative trade route from Iran via the Persian Gulf.
In spite of the firm stand taken by Tehran against western interests in the region and the pro-Iran attitude of some of the Caspian littoral states, there are a number of problems before the Iranian government. Iran has been insisting that the Caspian Sea is a lake and not a sea and therefore UNCLOS clauses of territorial waters, high seas and continental shelf and other jurisdictions cannot be applied to it and that its resources should be “exploited and managed” by the littoral states equally based on the system of “condominium”.
Another problem lies in the attitude of central Asian countries towards Iran. All the Central Asian states have established relations with Iran; Iran has been sending ambassadors with secular backgrounds in order to convince the Central Asians that Iran’s Islamic Revolution is by no means a threat to these states. The Central Asian states, particularly Kazakhstan and Turkmenistan have also had a welcoming attitude towards Iran. For example, Kazakhstan is more inclined for a pipeline route via Iran, against the wishes of Washington. Turkmenistan also wants to further develop its gas routes with Iran. Kyrgyzstan with its weak economy has not cast many problems for Iran so far. However, it is Uzbekistan that seems to be at unease with Iran. Although Islam Karimov has maintained a friendly relation with Tehran, the Uzbek leadership still considers Iran as a force that can seriously alter the balance of power in the region in aspects that might not be so agreeable to the former. For example, Iran may take the role of a religious champion; it can also favor culturally related Tajiks over Uzbeks and thus lessen Uzbekistan’s position in the region. Iran’s Shia dominated society is also looked at rather suspiciously by the Central Asian Sunnis. There are hardly any Shias in Central Asia. Though a small minority of Ismailis lives in the Badakhshan region in Tajikistan; they are not considered true Muslims by the Shias in Iran. During the civil war in Tajikistan, the Tajik government was suspicious of Tehran as the latter had some close relations in the Islamic Renaissance Party (IRP). However, the fears were put to rest in face of the mediatory role played by Iran in the post-civil war scenario. Since then, Iran and Tajikistan have had good relations. The cultural factor, especially the common language of the two nations has contributed much in the strengthening of bilateral relations between the two.
Turkmenistan, the only country in Central Asia to have common borders with Iran has enjoyed good relations with Iran due to its dependence on Iran for transit route. But the relations faced a setback in face of US sanctions against Iran, which prevented the latter from financing the planned Turkmen-Iranian-Turkish pipeline which was to carry 30 billion cubic meters of Turkmen gas to the market. As a result, Turkmenistan had to settle for a pipeline that could deliver 4 billion cubic meters of Turkmen gas. In spite of US intervention, the two countries have completed some major projects, for example, the Friendship Dam and the Sarakhs-Mashhad Railway.
Nevertheless, Iran has been continuously strengthening its ties with Central Asian states. In 2008, with the support from Tajikistan, Iran became a full time member of the Shanghai Corporation Organization (SCO). Iran’s nuclear program has also become a threat for Washington. Supporting the US might lead to strong retaliation from Iran. Therefore, Kyrgyzstan, which has US military presence in its territory has declared that it would not allow a US intervention into Iran from its soil. This, though obliquely, has brought the two countries closer.
Inspite of the security situation in the region, including the Georgian dilemma and the apprehended western encroachment in the region, the influx of oil and gas from the Caspian has hardly been affected. In fact, the deal between Azerbaijan and the British Petroleum Company came only a year after the Azeri military coup of 1993. Not only Azerbaijan’s energy exports depend on the security situation in Georgia but the ethno-religious tensions in the Central Asian countries of Uzbekistan, Tajikistan and Kyrgyzstan can have unwanted effects on the export activities of Turkmenistan and Kazakhstan. The Russo-Georgian war of 2008, while show casing Russian ambitious designs, also highlighted the unstable situation in the region. Ever since the dissolution of the Soviet Union in 1991, the region has experienced escalated tensions. Starting with local conflicts in Azerbaijan, Armenia, Georgia and Tajikistan in 1991, there soon erupted the First Chechen War in 1994 that lasted until 1996. In 1999, Russia waged a second war on Chechnya which officially ended in 2009. These incidences of ethno-political tensions create certain creased foreheads across the globe against the wishes of a smooth supply of hydrocarbons from the Caspian region to the international market.

Tehran – Moscow Relations

Before the dissolution of the Soviet Union in 1991, Iran had started developing cultural links with the states of the Caucasus and Central Asia during Gorbachev years. Though Azerbaijan and Tajikistan were important factors in Iranian policy making at that time, but when President Hashemi Rafsanjani took an official tour of the newly independent states of Central Asia in 1993, his schedule included a visit to neither Azerbaijan nor Tajikistan due to the civil turmoil in the two states. While Turkmenistan has a common border with Iran in the Central Asian sphere, Azerbaijan and Armenia have respectively a long and a shorter border line with Iran in the Caucasus region. Iran and Azerbaijan are also littoral states on the Caspian Sea. On one hand, Iran’s stance of maintaining the borders in the Caspian as demarcated during the Soviet era is not very acceptable for Azeri leadership. Moreover, the tensions between the two neighboring regimes are further deteriorated by Azerbaijan’s claim on the north-western provinces of Iran which Azeri regime refers to as “Southern Azerbaijan.” In fact, the Azerbaijani population in the Northern provinces of Iran, with a figure of approximately 20 million, forms the largest minority in Iran. It was only after the independence of Azerbaijan in 1991 that the Iranian leadership started paying serious attention to its Azeri minority in the north. The Azeri claim of Southern Azerbaijan together with the fact that large oil deposits for a relatively smaller state as Azerbaijan which significantly contribute to strengthen its position in the region, added to Iranian concerns of the latter’s designs against the provinces in the north. In these circumstances, Tehran’s best option was to set up a pattern closer to the Turkmanchai Treaty of 1828, whereby Russia could exercise its control on Azerbaijan. Therefore, when war broke out between Azerbaijan and Armenia in 1993, Iran was quick to responding in a manner suited to its national interests. The nationalist Azeri elements in Iran expected an all-out support to Azerbaijan which also shares a common religion with Tehran, whereas the policy makers in Tehran saw the weakening of Azerbaijan as an opportunity to reinforce Iran’s own national interests in the region. But as Turkey backed out from its support of Azerbaijan, Iran, looked upon rather suspiciously by the regime in Baku, stepped in to accelerate ceasefire attempts between the two states in order to keep the region from going into bedlam. Iran’s inclination towards Armenia was also due to the fact that the government in Azerbaijan under President Abulfaz Elcibey showed increasing signs of pro-western and anti-Russian and anti-Iranian trends. With Elcibey’s overthrow and the establishment of Hyder Aliyev’s government in Baku, the Iran-Azerbajan relations showed some signs of improvement but only apparently so. As Elcibey’s foreign policy continued under the new government, Iran’s relations with Armenia continued to improve while those with Azerbaijan continued on previous note. The question of the legal status of the Caspian Sea is also a serious issue between the two regimes. But Iran has a silent support of Russia in its relations with Azerbaijan as the latter with its large oil reserves in contrast to its small population along with a discernable bend towards USA is also an important constituent in the foreign policy map of Moscow.
While, Tehran’s relations with Baku remain questionable, those with Moscow have shifted as per the need of the time. Keeping in regard the calculated attitude of the US administration towards Iran and Russia, the two neighboring states have adjusted their alliance to counter the US backed outlook in the region. The bases for this alliance were provided by Hashemi Rafsanjani when he visited Moscow in 1989. The mutual agreements concluded then included a joint resistance to US hegemony and the “containment of Azerbaijan”.
Opposition to US hegemony in the region seems to be the common policy of Tehran and Moscow. In the case of Iran, the periphery states and the regional actors acknowledge Iran’s importance in not only the traditional geopolitics of the region but also in view of the economic and commercial benefits that the republic offers. As recently as in late January of 2012, the Indian government made an unambiguous announcement regarding its decision to continue the import of Iranian oil. While the statement was seen as a diplomatic victory in Iran, it simultaneously provided a signal as to the notion that the geopolitics of Caspian region are not so simple after all, nor can they easily befall foreign designs in the region as neither Russia nor Iran can be minus from the equation.

Conclusion

The geography of the Caspian Sea connects it with areas that may become trading hubs in the future. In view of the rising fuel prices, the Caspian Sea may also have the potential to revive its role as the trade link between the east and west, whereby it was a part of the network of land and sea routes which once formed the Silk Road. This will prove to be beneficial for both the western market economies as well as the regional and periphery actors.
The major oil companies operating in the region are state owned companies of littoral states with KazMunaiGaz, TurkmenNefteGaz, GazProm and Azerbaijan International Oil Company taking the lead. That Russia dominates the region in the export of hydrocarbons from the Caspian is manifested by the fact that majority of the pipelines follow a northern pass through Russia form where they turn west for Europe and towards east for China. The Russian route through the Caspian Pipeline Consortium (CPC); a pipeline constructed in 1992 to transport Caspian oil from Tengiz Field in Kazakhstan to Novorossiysk in Russia, is now run jointly by KazMunaiGaz and the Russia based Transneft. It transports oil from Kashagan in Kazakhstan to Novorossiysk in Russia, from where it reaches the European markets through the Burgas-Alexandroupoli pipeline. Even one of Turkmenistan’s two major pipelines runs through Russia, while the other passes through China. The pipeline connecting Turkmenistan with Iran produces a much lower growth. Though the amount of gas imported by Russia from Central Asian Republics is high but Moscow acquires healthy revenue by exporting this gas to Southern Europe via two routes; the Blue Stream and the South Stream. The former channel passes through Turkey, whereas the latter is connected to the South via Bulgaria. Azerbaijan, on the other hand, exports ‘half of its gas to Georgia, Armenia and Turkey and the rest to Russia.’ In addition to this, after Saudi Arabia, Russia and Iran remain the second and third largest oil exporters in the world.
Furthermore, in addition to the potential of the region for the world community, both Iran and Russia have a lot to offer each other. Both the states have huge reserves of oil and gas. While Russia is the dominant force in the transport of Caspian hydrocarbons to Europe, its interests in the natural gas reserves of Iran serve a dual purpose; to become involved in upstream production, and to involve itself in the transport of Iranian gas to South Asia. Being the largest natural gas exporter (199,900,000,000 cu m in 2010), Russia’s interest in natural gas sector is but natural. As far as the European market is concerned, Iranian involvement in the Gazprom dominated souk is the last thing that Russia wants. Russia is by no means ready to share its monopoly in the gas market with any other state. In the same light, the practicality of a European designed pipeline; Nabucco Pipeline depends on the supply of Iranian gas for the scheme. In this regard, the chances of Iranian cooperation with Russia stand taller than those with Europe, the primary reason being the moral and diplomatic support of Kremlin on the much apprehended nuclear program of the Islamic state.
As far as the Iranian nuclear program is concerned, two different opinions need to be quoted; firstly, it is often considered that Russia does not see Iran’s acquisition of nuclear weapons harmonious to its own interests. Any such situation would rather sabotage the geostrategic balance right from the Caspian and Central Asia to the Caucasus against Moscow. Some states would also have to shift their balance towards Tehran if the latter becomes nuclear. Such a case would not only create a rival power in the Caspian but would also greatly affect the Caspian hydrocarbon politics. Moscow however, continues to serve Iran as a condenser for US policies against itself. The second perception in regard to Iran going nuclear is the fact that Russia often speaks of nuclear equality through peaceful means as a fundamental right of any state, including Iran. In the wake of the current Iranian-Israeli confrontation on nuclear issues, and the threat of a use of force against Tehran, Russian stance was more vocal than ever before when Kremlin warned the western community of a “serious mistake with unpredictable consequences” , more so because of an apprehended threat of an Iranian blockade of oil supply from the Gulf region. Russia’s very vocal stance on an expected American backed Israeli action against Iran in recent months also highlights the importance that Moscow addresses to Tehran in its geostrategic affairs. For Russia, the effects of any power show against Iran will not remain confined to the Islamic state, but will rather have direct consequences for Russian market and its periphery politics. Aspiring to become a regional cum global power in the coming years, Russia would take no risks in the course of its power evolution from a former to an existing super power. For this, Russia would but only continue the hydrocarbon and arms trade with the world community in general and with Iran in particular. Events in the years of recent past have attested this very policy of Russia; for example, in 2005, when the International Atomic Energy Agency (IAEA) referred the question of Iranian nuclear procurement program to the UNSC, Russia prudently walked the thin line between international concerns and those of the Iranian counterparts. However, by voting in favor of the UNSC sanctions against Tehran in 2007 and 2008, Moscow invited a serious threat of the abandonment of Iranian cooperation in the regional milieu. Consequently, in a meeting of P5+1 in 2008, Russia refused any further cooperation with the international community on Iranian nuclear question and has since then voiced overt support for the latter’s right of acquiring a peaceful nuclear program.

Source
In point of fact, from arms trade to hydrocarbon business and from pipeline conduits to diplomatic collaboration, Tehran and Moscow have a lot to offer each other which will be but only strengthened through consistent and incessant mutual relations. Tehran and Moscow have come more close together in the recent past then they have been before. This is mainly because of the realization of the fact that both the states, with strong developing markets, are the geographical realities of the Caspian region which enjoys an important and indispensable position in respect for its hydrocarbon reserves as well as for being the most cost effective conduit for the supply of this capital to the international community. Therefore, the coming future would see an escalation in the importance of all; the Caspian basin, Russia and Iran.

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