Iranian-Turkish Relations Vis-à-Vis Turkey’s Energy Transit Policy

Despite Western economic sanctions, Iranian-Turkish relations have been developing in many different directions in recent years. Illustratively, on October 24–25, the Eastern Anatolia Development Agency (DAKA), Iran’s Foreign Ministry Institution for Political and International Studies (IPIS) and the Turkish Asian Center for Strategic Studies (TASAM) jointly hosted the Turkey-Iran Van Forum in the Turkish city of Van. The main theme of the Forum, which was inspired by a Turkish-Iranian foreign ministers’ meeting from earlier this year, was “Sectoral and Financial Deepening” (tasam.org, accessed November 14). In this framework, participants discussed topics that included “Public Diplomacy,” “Energy and Petrochemistry,” “Turkey-Iran: Dialogue of Civilizations,” “Logistics, Transportation and Communication” and “Economy and Trade” (Ihlas Anadolu Agency, October 24).

An important part of the Turkish-Iranian relationship is currently based on energy trade. In 2013, 25 percent of Turkey’s natural gas demand was provided by Iran (Turkiye Gazetesi, April 24). It should be noted that Turkey swaps gold for Iranian gas because of the exclusion of Iranian banks from the Society for Worldwide Interbank Financial Telecommunication (SWIFT) financial transaction system as a result of economic sanctions imposed on Iran. Turkey’s gold-for-gas trade with Iran somewhat undermines Western economic sanctions against Iran. In addition, the deepening of bilateral relations between Ankara and Tehran, based on this energy resource–driven interdependency, raises Iranian influence on Turkey’s energy transit policy.

Turkish-Iranian relations may seem problematic due to the clash of the two countries’ interests in the Middle East—especially with regard to Syria and Iraq. Yet, this factor seems not to have affected the development of economic and energy transit relations between Ankara and Tehran. In a particularly important example, the possible future transit of Iranian gas via the Trans-Anatolian Natural Gas Pipeline (TANAP), which will be jointly actualized by Turkey and Azerbaijan, is gaining strategic importance in Ankara’s energy policy calculations. TANAP, which will cross Turkey, is to be connected at its eastern end with the South Caucasus Pipeline (often referred to as the Baku-Tbilisi-Erzurum pipeline, which traverses Azerbaijan and Georgia before crossing into Turkey) and in the west with the planned Trans-Adriatic Pipeline (TAP). Together, these three pipeline segments will form the Southern Gas Corridor, the first new transit route of non-Russian natural gas supplies to Europe that also entirely bypasses Russia and its pipeline network. Taner Yildiz, the Turkish minister of energy and natural resources, stated that Iranian gas will be an important supply source for Europe (The TEPAV-BP Energy Forum, Ankara, February 26). If the sanctions against Iran are lifted, Iranian natural gas could be transported westward by being pumped into TANAP after 2018, when the pipeline project is scheduled to be completed.

Notably, Azerbaijan’s offshore Shah Deniz Phase II gas field operation is not sufficient for the TANAP project. Therefore, the planned pipeline’s operators have been looking for extra gas to fill it. Possible suppliers could include Iran, as well as, Turkmenistan, Northern Iraq (Kurdistan) and the countries of the Mediterranean region, especially Israel. Turkey seems to have been most interested in attracting Iranian and Turkmenistani gas for TANAP. Cooperation with these countries in the energy field could help diversify Turkey’s gas import policy. Specifically, if Turkey is able to expand its strategic partnership with Iran in energy issues, it may be able to overcome its dependence on Russian gas. Last year (2013), Turkey purchased 58 percent of its natural gas from Russia (Anadolu Agency, August 21).

However, Turkey’s lobbying activities for eventually starting shipments of Iranian gas to the European energy market continues to disturb Israel and Russia. Undoubtedly, Israel is concerned that Iran might be able to use its gas exports as leverage to rid itself of economic sanctions and free up resources toward obtaining nuclear weapons.

Apparently, the conflict of interest among Turkey, Azerbaijan, Israel and Russian regarding the issue of gas transit to Europe is forcing Ankara to seek alternative approaches. In October 2014, despite the objections of Greek Cypriot authorities, Turkey sent the seismic survey ship “Barbaros Hayreddin Pasha” to search for oil and gas in the Eastern Mediterranean. It is estimated that a total of 3.5 trillion cubic meters of natural gas resources are available in the region. Thus, within a relatively short period, the Eastern Mediterranean could become a “second Caspian” in terms of its energy resource potential (Chagri Erhan, Turkiye Gazetesi, October 26). Taking this into account, Turkey considers the eventual transit of Eastern Mediterranean gas via the TANAP pipeline to be an important strategic option, after Azerbaijan’s Shah Deniz Phase II gas field. But for now, Turkey lacks viable partner countries in the Mediterranean, thus raising the importance of reconciling relations with Israel.

As Russia’s relations with the United States and the European Union continue to deteriorate, Turkey’s potential as an alternative supplier of natural gas to Europe grows in importance. Ankara’s budding energy partnership with Tehran could play an important role in this transformation if sanctions against Iran are eventually dropped. But to truly live up to its potential as a transit country, Turkey may need to simultaneously reconsider its foreign policy strategy in the Eastern Mediterranean.