Will Ward
I want to quickly flag three important resources that are all well worth a click.
- Check out this talk and accompanying oped by Bryan Early, who is a fellow at the Harvard Belfer Center working on sanctions policy. Early’s research is on the dynamics of (mostly) American sanctions and the effects these have on the trade of sanctions target countries with third party states. The work is based on an econometric analysis of over a hundred cases and found, among other things, the counterintuitive result that an alliance between the sanctioning state and a third party state means that the third party state is more likely to engage in sanctions busting trade with the sanctioned state. Why? Think about the USA-Iran-UAE trade triangle. US sanctions on Iran create market distortions – pent up demand in Iran and supply in the US. These imbalances lead to hugely profitable opportunities in countries like the UAE, which for cultural, geographical and historical reasons already have good trade relations with Iran. To make its sanctions more effective, the US needs to put pressure on the UAE to stop this trade but this is unlikely to occur because a) profitable trade with Iran produces domestic groups in the UAE who stand to lose a great deal from sanctions enforcement, and b) if the US pushes too hard, it could jeopardize its security alliance with the UAE.
- Anthony Cordesman has a new working paper (PDF) on the Gulf military balance and terrorism/ asymmetric threat scenarios. Probably the best open source military analysis out there. Thumbnail is that Iran has a head and shoulders advantage over the GCC states in small craft naval warfare, but is severely outgunned in airpower, and that the biggest security threats are low intensity/ terrorism / infrastructure attacks but that a conventional war is unlikely. Also highly recommend their March report (PDF) assessing Israel’s (not great) military options against Iran.
- Gary Sick who runs the terrific Gulf/2000 listserv has a new public blog Gary’s Choices to post his expert commentary on Iran and US-Iran relations. Although I can’t seem to link to individual posts, be sure to check out his post from May 27 responding to the Leveretts’ NYT oped on Iran policy.
Andrew England has an article in the FT today on the widening gas shortfall expected in the GCC countries, felt most acutely in the UAE. Essentially, heavy industry and the desalinization plants necessary to serve the region’s growing populations are creating a boom in demand for gas. Yet the two most logical gas sellers Iran and Qatar (who have the world’s second and third largest gas reserves respectively ) are not in a selling mood. Qatar has a moratorium on expanding its North Field until 2013 at the earliest while it completes a geological survey and Iran is playing hardball in its lengthy pricing negotiations over gas sales to the UAE’s Crescent Petroleum.
This story is hardly new; GCC states have been seeking to make up for lost time on gas infrastructure — largely a consequence of focusing on oil production — for years with initiatives like the Dolphin Project (PDF). The problem now is that the credit crunch has made it harder to for states to make the investments in domestic gas production needed to make up the shortfall. This could end up giving Tehran the upper hand in gas price negotiations. But it also provides powerful incentives to put political squabbles aside and explore more cooperative ways to develop the huge fields straddling Gulf maritime boundaries. -WW
For a bit of overdue color on the contemporary Oman-Iran relationship, see Michael Slackman’s article (Oman Navigates Between Iran and Arab Nations, NYT, May 23, 2009) “The quietly influential Sultanate of Oman has accelerated its cooperation with Tehran, nurturing an alliance that helps empower Iran while highlighting the deep divisions among Arab capitals”.
Slackman’s piece supports points we’ve been making for some time, i.e., 1.) There are clear limits to the pressure the Arab states are willing and/or able to exert on their Northern neighbor (as well as limits to the pressure they’re willing to take from the West) 2.) There are many in the region who feel Iran’s acquisition of nuclear weapons is not the paramount to threat to security in the region [see Chorin's article "US Unwise to Deny Iran's Role in the Gulf" in the FT last year] and 3.) It’s largely about trade–the farther east one goes within the Gulf, the more dependent local economies are (and will be) on Iran for future energy needs and economic growth. See previous postings for details on the history of Iran-Oman trade since 2006. –EDC
Will Ward
In the new Arab Public Opinion Poll released yesterday Shibley Telhami’s team surveyed 4087 individuals across six Arab states and the numbers are not looking great for Iran. The incidence of Mahmoud Ahmadinejad being listed as a “most admired” foreign leader dropped from 2008. Respondents also were more likely to list Iran as a “threat” and support international pressure to curb its nuclear program.
In his talk, Marc Lynch hits it on the head in attributing this to the propaganda campaign in Egyptian and Saudi media that has gone into overdrive in the last year or two. I would only add that this campaign is not limited to state media, but has often carried over to religious figures like Qaradawi who have also helped turning up the anti-Iran/ anti-Shia rhetoric in recent months. The fact that Ahmadinejad’s year on year figures dropped more sharply with Egypt included (-7%) than with it excluded (-4%). should give pause to those who might worry about Iran attempting to gain influence in Cairo by supporting the Muslim Brotherhood.
I’d be fascinated to see polling data on some of the countries in the region with warmer relations with Iran – Oman, Syria, Iraq. But the holy grail would be some solid data on wider Arab attitudes towards Iran across the Sunni- Shi’a divide to better test the reams of ‘Shi’a crescent’ style punditry that puts sectarian indentification in the analytic drivers seat.
The above image is taken from the slides presented at the Brookings event. You can download them here (PDF), and watch the video recap here.
Pan Arab Asharq Al Awsat on May 14 carried an interesting a piece entitled “Larijani in Mascat: Iran’s power is for the benefit of the all of the countries in the region…and we do not pose either a threat or intend to create an empire.” The comments, made by Iran’s Leader of Parliament, came on an official visit to the Sultanate this past week.
During the visit, Larijani and senior Omani officials praised expanded Omani-Iranian political, cultural and economic cooperation, in particular the Iran-Omani “Kish field” gas deal. The agreement, signed in December of 2008, would in its first phase deliver 1 b. cubic feet of natural gas per day to Oman, through a pipeline linking the underwater field to Oman’s Musandam Peninsula. An extension would carry gas on to the city of Sohar, on Oman’s Batinah coast, West of Muscat. In its final phase, the pipeline is expected to deliver 3 b. cubic feet per day. If Iranian gas were to be re-exported, neighboring countries experiencing severe energy shortages would stand to benefit.
Oman agreed to cover the entire 12 billion US development cost, but has been having some difficulties raising the required capital. An anonymous source told Reuters last week that the global economic crisis would delay completion by a year, to 2013. Larijani’s trip coincided with an official visit to the Sultanate by the head of Hamas’ political directorate Khaled Mishal.The ex-“Enriched Iranium” blog detailed Oman’s growing ties with Iran 2007-2008, including agreements to trade Omani investment in newly-privatized Iranian companies for technical assistance and investment in Omani ports. –EDC
Tehran-headquartered Islamic Republic of Iran Shipping Line (IRISL) is looking to expand its reach through slot-sharing agreements with other lines and investments in foreign container terminals. According to Containerisation International (CI On Line, March 22, 2009) the company recently signed agreements with China Shipping Container Lines (CSCL) for capacity on the Mediterranean/Asia trade, and Melfi Marinae SA on the Mediterranean-Caribbean Basin trade. Captain A. Ezzati, IRISL’s General Manager for Strategic Planning and International Affairs, noted said the line is “not ruling out” the prospect of investing in terminal facilities in the Med basin, including Tunisia, Algeria and Libya, in anticipation of increased relay cargo from the Far East and Middle East. Malta, Barcelona and Valencia are currently key relay point for cargo going to/from Iran to the Carribean and Central America.
In related news, IRISL is upgrading its fleet to include four six 5000 TEU (Twenty-foot Equivalent Units) and four 5150 TEU container ships, nine 22,000 dwt multipurpose heavy lift vessels and ten open hatch handy-sized bulkers scheduled for delivery. IRISL is one of the largest commercial companies in the Middle East, and ranks 25th globally (as of 2004). The company, which employs some 7,000 staff and carries (2004) 22 million tons per year, controls approximately 40% of the domestic Iranian container trade. The U.S. Treasury Department added IRISL to OFAC’s Specially Designated National (SDN) list in September of 2008, thereby freezing any U.S. assets and prohibiting transactions with U.S. parties. IRISL’s domestic representative offices include Bandar Abbas, Bandar Imam Khomeini and Chabahar.
