The Iran deal was particularly unfavorable to Russia, which stands to lose billions in oil earnings as Iran re-enters world markets. Moreover, the economic offset Moscow hoped for—sales of conventional weapons to Iran—is blocked for five years. So why did the country sign on? Brookings fellow Pavel Baev has an important part of the answer here
As usual, the answer is far from simple and resides ultimately in the fevered mind of Russian President Vladimir Putin. Russian support for the negotiation process with Iran has been inconsistent and overall demonstrates some mixed emotions. From a narrow Russian perspective, the deal threatens to create yet another steady stream of oil and gas onto the world market at a time when depressed energy prices are already threatening the Russian economy. With that disadvantage in mind, the deciding factor was likely the Chinese one. The Chinese wanted the deal for their own reasons and Vladimir Putin, for all of his bluster, is in no position to resist them.
For Beijing, the Iran deal is excellent news. China plans to pump investment into Iran through lucrative business deals on everything from pipeline building to major infrastructure construction, and the deal is likely to keep oil prices low for some time—a major interest for China, which is the world’s largest importer and whose economy is being squeezed by falling prices for its manufactured exports.
That’s clearly part of the reason why Russia didn’t play more of a spoiler’s role in the negotiations. China really, really wanted the deal, and Putin, hit by western sanctions and low oil prices, is in no position to fight Xi.
But great powers usually have more than one reason for the steps that they take, and Russia probably has another end in view also. Iran’s rulers may be radical Islamists as intolerant and imperialist as ISIS, but Russia sees the Shi’a Islamism of Iran as an ally against what it really fears: radical Sunni Islamist groups that start to operate inside Russia itself — in the still-restive Caucasus, as well as in other regions of great interest to Russia in the former Soviet Union countries of Central Asia. Iran sees Sunni jihadis as rivals and, Russians believe, has been helpful in preventing Sunni jihadis from entering Russian territory through the lower Caucasus. What’s more, Moscow and Tehran are also in agreement about the need to prevent a Sunni victory in Syria.
Put the two considerations together—China and jihad—and Russia’s Iran policy makes sense from Moscow’s point of view. Still, it is an expensive policy, and the prospect of low oil prices and competing supplies of natural gas from Iran is bad news for the Kremlin.
One likely result: Putin will crack down on domestic dissidents, keep tight controls on the press, and continue to maintain a hard line against western funding for NGOs and other groups on Russian soil. With hard times coming, he won’t want to give his opponents much space within which to operate.