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Iranians are at sea over the new Caspian convention

Caspian Sea Deal

Earlier this month, Iran and four ex-Soviet countries finally reached an agreement on the legal status of the Caspian Sea. By extension, they also agreed to set the foundation for the division of its abundant natural resources, including oil and gas.

This belated agreement – the Convention on the Legal Status of the Caspian Sea signed in the Kazakh city of Aktau — has been almost thirty years in the making. Ever since the dissolution of the former Soviet Union in late 1991, in fact, prior to which the USSR had a clearly defined maritime border with Iran.

Composed of 24 articles, the convention was signed after 22 years of structured negotiations including 50 special working group meetings and five summits. Despite the huge effort, serious questions are being asked about the nature of the deal and the fact that it doesn’t appear to tackle thorny issues in relation to maritime borders adequately, and the fair division of the sea’s resources.

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In Iran, the deal has been met with a mix of scepticism, concern and downright hostility as the agreement does not meet core Iranian demands, notably in relation to maritime borders and adequate access to energy resources under the seabed.

Moreover, there are concerns that the Iranian government may have made too many concessions to the Russians in order to secure the deal. On the other hand, it is a diplomatic success for Iran as it gives security guarantees and comes on the heels of a renewed US push to isolate the country on the global stage.

Lake or sea?

Iran’s starting position in the multilateral negotiations that began in 1996 was that a post-Soviet partition of the Caspian Sea must take account of the spirit – if not the provisions – of the only two existing treaties related to its legal and political position, the 1921 Russo-Persian Friendship Treaty and the 1940 Accord on Trade and Navigation.

Not surprisingly, early multilateral negotiations went nowhere as the other four littoral states —Russia, Kazakhstan, Turkmenistan and Azerbaijan — preferred to enter into formal and informal bilateral (and in some cases trilateral) agreements to resolve urgent issues and disputes.

Arguably the biggest sticking point in the protracted negotiations was whether to call the Caspian a lake (as it is a landlocked body of water) or a sea. The apparent decision to call it a sea, albeit one with “special legal status” according to the Russians, means that the United Nations Convention on the Law of the Sea may well apply to the Caspian, thereby ensuring freedom of navigation beyond the littoral states’ defined territorial waters.

READ: Why there will not be a US-Iran summit 

The tentative decision to recognise the Caspian formally as a sea constitutes a remarkable breakthrough, not least as it dissents from the expectation of experts who were betting against it more than a decade ago. However, it is bad news for Iran, which argued from the outset that in keeping with bilateral Iranian-Soviet treaties the Caspian should be called a lake. In a nutshell, as a sea, ownership of the seabed would be based on each littoral state’s coastline. As a lake, though, the seabed would be divided equally between all five countries.

In view of the fact that Iran has the shortest Caspian coastline, its sea status reduces dramatically the country’s ownership of the seabed and the energy resources which lie beneath it. Despite the fact that in practical terms Iran had long abandoned the quest to maintain the Caspian’s lake status, the formalisation of the Caspian Seais a blow to national pride.

A big win for Russia?

One veteran American analyst has lost no time in describing the convention as a “big” win for Russia, despite the fact that the final text of the deal has yet to be published. However, Moscow’s insistence on a “special legal status”, effectively implying that the Caspian is neither a sea nor a lake, has inevitably raised suspicions of Russia’s intentions in any future negotiations related to or even superseding the current agreement.

The convention is good news for the oil and gas industry as the Caspian Sea is estimated to contain 48 billion barrels of oil and 292 trillion cubic feet of natural gas. There is now widespread expectation that the deal will boost oil and gas exploration, in addition to speeding up the construction of a proposed oil pipeline between Kazakhstan and Azerbaijan.

READ: Russia’s re-emergence as a Mideast power is not necessarily good news 

Another feature of the convention is the prohibition on the deployment of foreign military forces to the Caspian Sea region. This is particularly important for the Russians and Iranians, who are fearful of a potential US or NATO deployment to the area. Indeed, Iran’s President Hassan Rouhani was keen to highlight this feature when praising the overall agreement.

More broadly, the convention is viewed as a partial diplomatic success for Iran in so far as it breaks the country’s “sense of economic isolation” amidst the re-imposition of US sanctions. The trouble for the Rouhani, though, is that many people in Iran are unhappy with the government. This is in part due to the fact that Iran signed the convention without holding a proper national debate.

The Caspian Sea is a sensitive issue in Iran, not least because Tehran used to control all of it before the Russian Empire encroached on the northern and central parts of the sea in the early 19thcentury. In recent days, many Iranians have vented their fury at the deal on social media, decrying the government’s “treachery” in the process.

READ: Is Iran serious about closing the Strait of Hormuz? 

However, much of this criticism borders on delusional ranting. For example, the insistence that Iran should have a right to fifty per cent of the Caspian Sea’s resources takes no account of the emergence of four new littoral states following the collapse of the Soviet Union. Whilst Iranian experts are right to identify ill-informed public opinion as an obstacle to rationalising the newly-signed convention, they forget their own complicity in creating the current atmosphere by failing to generate a proper national debate on the issue.

In conclusion, it is fair to assume that Iran could have got a better deal had it been in a stronger diplomatic and economic position. In that respect, the Caspian Sea Convention exposes Iran’s relative lack of political and economic leverage over Russia, a reality that Moscow will no doubt exploit ruthlessly as Iran-US relations plummet further into the abyss.

The views expressed in this article belong to the author and do not necessarily reflect the editorial policy of Middle East Monitor.

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