Ukraine and the Iran agreement

Iran

 

2015/07/15 • Analysis & Opinion

Article by: Vitaliy Portnikov

The nuclear agreement reached between six major world powers and Iran marks an end to the crisis that has lasted 13 years.

No, this agreement is not a guarantee of safety. The government in Iran remains a theocratic regime that absolutely needs to create enemies and to fight them. And, literally a day before the agreement was reached,  the actual head of state, Ayatollah Ali Khamenei, confirmed that the essence of the regime is the need to oppose the United States.

It is also clear that until the theocracy collapses Iran will not give up on attempts to develop nuclear weapons. It will act more carefully and will be caught in the act. So there will be new crises in the future.

However, this one has ended. In practice it means abandoning the sanctions against Iran. Within a few months Iran will be able to begin to take advantage of its oil. And this means not only the oil that will be extracted, but first of all the oil that has accumulated during the sanctions period.  And this also means that such a quantity of crude will reach the market simultaneously that the consumer simply will not be able to digest it.  In turn, this means that the price of crude will drop significantly. Once the accumulated oil runs out, the price will recover but not by much.

This means serious challenges for countries such as Russia or Venezuela. The Russian budget again will face a significant deficits. The Russian ruble will collapse.  Prices in Russian stores will soar. Mass layoffs will begin along with delays in the payment of wages and pensions. Or there will be no delays, but the exchange rate of Russian currency will rise.

On the one hand, this is good for Ukraine. Any movement toward the complete and irreversible collapse of Putin’s regime and the reformatting of Russia into something that resembles a country rather than a gang of predators is useful for us. But on the other hand, the problems in the Russian economy will bring difficulties for us as well because, unfortunately, our markets have not been completely separated and we remain dependent on a drowning entity. This is something that we must also take into account. If we want to survive, we must absolutely reject any economic ties with Russia.

Another important result of the agreements with Iran is that the West, once again, will be able to pay close attention to the Ukrainian crisis. In recent weeks, the situation around Greece and the situation around Iran were the most important items on the agendas of Western diplomacy. At the same time, in the case of Greece, it was necessary to prevent the possible destructive interference of the Kremlin, which has its agents in the ranks of the Greek left-wing and right-wing radicals, and, in the case of Iran, to cooperate with the Kremlin to achieve an acceptable result. Now the importance of these contacts has decreased. However, there is growing interest in solving the Ukrainian crisis. And we need to take advantage of this interest so that we are not pressured by others, but so that we and the West together put pressure on Russia. Moreover, as the price of oil drops — and it will drop even before the additional volumes of crude appear on the market — the Kremlin will be more cautious and accommodating.

At the same time, it is important not to forget that we are dealing with a window of opportunity. And the Greek crisis and the crisis around Iran do not have permanent solutions. Instability will inevitably return. And before it does, it would be desirable to resolve our most fundamental issues related to the restoration of the territorial integrity of our country and the acceleration of its European and Euro-Atlantic integration.

Translated by: Anna Mostovych
Source: Espreso TV

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  • Mykola Banderachuk

    one positive that comes to mind is that now Europe has an alternative source of energy and if they are smart, buy Iranian oil and gas and not putin’s oil and gas. putin loses a large market, putin will now not be able to blackmail the EU like he has done in the past. This is just one consequence of the Iran deal. How long before the boyars revolt against their pygmy master. he is finished and it is only a matter of time.

    • Dagwood Bumstead

      Europe already had alternative sources of energy. Norway now suppiles more oil and gas than Dwarfstan does. When Iranian oil hits the market, even if Dwarfstan’s sales remain at the same level, income will go down due to lower prices as related in the article. The dwarf and Co aren’t likely to steal less so that leaves Moscow with less cash for government spending. The armed forces and the war against Kyiv won’t get less as these are the dwarf’s top priorities so the rest will get even less after their budgets already were slashed previously. Think health care, education, infrastructure, wages etc etc including subsidies to the occupied territories- Transnistria, Abkhazia, South Ossetia, the Crimea and the so-called LNR and DNR. Perhaps even Kadyrov will have to accept a cut…… but will he?

      • Jimma

        This is already happening.

      • Mykola Banderachuk

        not likely putin jr. aka kadyrov will accept a pay cut-let the fun begin

  • puttypants

    Darlings Putin will be selling Iran missiles and other arms to makeup for his lose of oil revenue. He’ll probably make more money from those sales than oil. Putin wouldn’t have done this deal unless there was something in it for him. Maybe Ukraine. Obama would do just about anything for this deal with Iran. He want’s to be the big peacemaker in history.

    • Dagwood Bumstead

      Even the dwarf doesn’t want a nuclear-armed Teheran round the corner. Moscow is a lot closer to Iran than Washington is. The ayatollahs may be anti US now, but who can guarantee that this state of affairs will last? The next generation of ayatollahs may well see things differently. And the dwarf will have to sell a huge amount of arms to Teheran annually to make up for the loss in oil and gas revenue due to falling prices, even if Dwarfstan can keep its market share- which is highly unlikely.

    • Jimma

      Just so many arms can be purchased darling, and limited resale. See the agreement!

    • John Shirley

      It wouldn’t surprise me if Russia is already crating up nukes to be sent to Iran as we speak.

      • Marlin

        We can only hope.

  • Jimma

    Good article. Ukraine must act quickly to get its house in order. Russia economically will be at its weakest point within 6 months. Europe will be flooded with energy now. Crude dropped a dollar a barrel after news of an agreement. It will probably bottom out at $35 dollars a barrel. Not good news for me , but I am anxious to see my second country Ukraine restored to its beauty. Viva Ukraine!

    • Dagwood Bumstead

      I read elsewhere that Iranian oil could result in a price drop of some $15 as the country tries to regain its market share in the EU. Much of Iran’s share in the EU market was taken over by Dwarfstan and Teheran will no doubt want it back.
      If correct this would mean oil prices of around $40 per barrel. Not exactly good news for the dwarf, who will have to slash even more in either his own cut and that of his crooked cronies (unlikely), military expenditure and the war against Kyiv (again, unlikely) or cut again in the rest of the state budget such as health care, education, wages for civil servants etc (most likely scenario). I wonder whether the dwarf’s fans will like that?

  • Тарас Шевченко

    I am thinking that Russia is banking on a war between an Israel/Saudi Arabia alliance Iran and possibly Syria. This would create the demand for Russian arms to Iran and the two major oil countries at war would drive up the cost of oil which would benefit Russia as well.