Thursday, December 29, 2022

Iran, Russia and the EAEU - Creating an Energy Giant

While the Western world and its lapdog legacy media concentrates on the Ukraine-Russia conflict, the geopolitical landscape of the globe continues to evolve.  Here is news coverage from Mehr News Agency, a news agency of the Iranian government showing how quickly the globe is evolving into a multipolar reality:


This trade deal is yet another means by which two of the world's most heavily sanctioned (by Washington) nations can work around the punishment that has been meted out to them as a result of their disobedience to the international rules-based order.


This news follows this report from Russia's TASS news service dated December 14, 2022:


The Eurasian Economic Union (EAEU or EEU) is an:


" organization for regional economic integration. It has international legal personality and is established by the Treaty on the Eurasian Economic Union.


The EAEU provides for free movement of goods, services, capital and labor, pursues coordinated, harmonized and single policy in the sectors determined by the Treaty and international agreements within the Union."

At this point in time, the member states of the EAEU are the Republic of Armenia, the Republic of Belarus, the Republic of Kazakhstan, the Kyrgyz Republic and the Russian Federation as shown on this map:

The geographic proximity of Iran to the member states of the EAEU make it an ideal trading partnership.

The purpose of the EAEU is as follows:

"The Union is being created to comprehensively upgrade, raise the competitiveness of and cooperation between the national economies, and to promote stable development in order to raise the living standards of the nations of the Member-States."


Currently, the Union has a combined gross domestic product of $2.045 trillion and, in 2021, had total external trade value with third nations of $988.2 billion.  Given the current energy crisis in Europe, it is important to note that the EAEU had total oil production of 611.7 million tons (4.551 billion barrels) and natural gas production of 818.0 million cubic metres which will grow substantially once Iran's massive oil and natural gas production reserves are added to the total as shown here:

...and here:


There is little doubt that the massive oil and natural gas potential of the EAEU will provide the organization with political power that could be used to put political pressure on its foes in the future even if the Western world believes that it can transition to a green energy future.

In addition and to further complicate the issue, back in 2018, an agreement on trade and economic cooperation was signed between the EAEU and China and its Belt and Road Initiative.  This agreement reduced trade barriers and simplified customs procedures and will further strengthen the group's political and economic clout at the expense of the United States.


While Washington definitely prefers that its rules-based international order define the behaviour of all nations, thanks to its widespread and injudicious use of sanctions to punish the disobedient, we will continue to see pariah nations like Iran join its pariah peers in an effort to create a new multipolar global reality that benefits their interests just as the United States has done since the end of the Second World War.  Given the energy giant that is being created once Iran joins the EAEU and its extended trading partnerships, its political and economic clout have the potential to dwarf that of the Western world.

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