Russian President Putin Announces Plans for Gas Pipeline to Iran

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Russian President Putin Announces Plans for Gas Pipeline to Iran

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Pipeline for gas exports with Russian flags (© Shutterstock/Fly Of Swallow Studio)
Pipeline for gas exports with Russian flags (© Shutterstock/Fly Of Swallow Studio)

Russian President Vladimir Putin has announced plans for a gas pipeline to Iran, a move that could see Moscow export up to 55 billion cubic meters of gas exports annually in a long-term arrangement. 

These plans come against the backdrop of souring relations between Russia and the West due to Russia's ongoing invasion of Ukraine, a move that disrupted the global energy supply chain in 2022. 

While the ambitious project seeks to open an alternative market for Russia’s gas after Europe significantly reduced gas imports from Russia, it would not help Moscow to export more than it did before the Invasion of Ukraine. Nevertheless, it would offer an additional market for Russia’s hydrocarbons. 

The capacity for the ambitious pipeline is largely equal to the total volume that once was exported from Russia to Germany via the damaged Nord Stream 1 pipeline. The new pipeline deal comes after an agreement was reached between Gazprom of Russia and Iran's NIGC to provide Russian gas to Iran in a memorandum of understanding signed in June 2024.

Initial supplies may amount to 2 bcm a year, with an option for the pipeline to transit through Azerbaijan, Interfax news agency reported, citing Russian Energy Minister Sergei Tsivilev.

Iran has the second-largest gas reserves in the world, but U.S. sanctions have limited access to technology and hindered the development of its gas exports.

The new pipeline also potentially reopens the door for plans of extending the Iran-Pakistan gas pipeline, a project in which Russia has long expressed interest but has been held back by sanctions and political disputes. 

Until 2009, India was also involved in that project but drew back under U.S. pressure. A political rivalry between India and Pakistan has further complicated the development of the cross-border pipeline.