Russia promises Iran fuel despite sanctions

14th July 2010, Comments 0 comments

Russian companies are ready to supply fuel to energy-hungry Iran, despite unilateral US and EU sanctions targeting Tehran's oil and gas sectors, the Russian energy minister said on Wednesday.

The pledge came amid a period of tension between Russia and Iran unprecedented in the last two decades, compounded this week by President Dmitry Medvedev's statement that Tehran was nearing the potential to build an atomic bomb.

"Russian companies are prepared to deliver oil products to Iran. The possibility of delivering oil products to Iran exists, if there is a commercial interest," said Russian Energy Minister Sergei Shmatko.

Russia has already expressed its dissatisfaction with the sanction measures agreed last month by the United States and the European Union to punish Iran for its defiance in the nuclear standoff.

These go beyond the new UN sanctions that were agreed by Russia and other world powers which mainly target military-related industries.

"Sanctions cannot hinder us," Shmatko said after a meeting in Moscow with Iranian Oil Minister Massoud Mir Kazemi, quoted by Russian news agencies.

The two ministers also signed a joint declaration boosting cooperation in energy that envisages Moscow and Tehran creating a "roadmap" to plan out their future oil and gas cooperation.

The declaration says that the two sides will also consider the creation of a joint bank to finance oil and gas projects as well as the founding of other joint energy ventures.

Iran, which holds around 10 percent of the world's oil reserves, is the world's fourth-biggest oil exporter and the second-largest producer in the oil cartel OPEC after Saudi Arabia.

However a lack of refining capacity and inefficiency problems means Iran has to import vast volumes of petrol from a variety of sources in order to satisfy domestic demand.

According to Russian news agencies, Mir Kazemi declared that sanctions "will in no way have an effect on the economic and industrial development of Iran. Independent countries are truly cooperating with Iran."

Russia has traditionally been seen as a close political and economic ally of the Islamic Republic, but Medvedev's recent hardening of the Russian line on the Iranian nuclear drive has deeply irritated Tehran.

His comment that Iran was nearing nuclear weapons capacity prompted an angry reaction from Iranian Foreign Minister Manouchehr Mottaki, who rejected the remarks as "totally false".

The sanctions signed into law by US President Barack Obama effectively shut US markets to any firms that provide Iran with refined petroleum products.

EU leaders have agreed sanctions banning new investment, technical assistance and technology transfers to Iran's gas and oil industries. The details are to be approved at a meeting of EU foreign ministers on July 26.

© 2010 AFP

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