Increasing crude oil production from the extremely oil-rich West Karun fields in Iran to at least 1 million barrels per day remains one of the priorities of the Islamic Republic. However, the state, long under sanctions, urgently needs help from its allies to access its wealth. At the same time, China, which agreed to help, decided to use blackmail to improve the conditions of the agreement already concluded and signed 25 years ago, using the desperate situation in Tehran. Simon Watkins, an energy market expert, writes about this in an article for the OilPrice resource.
According to the specialist, media reports that China will not go ahead with some of its obligations on Iran’s West Karun fields are incorrect: China plans to move forward with these developments by a one way or another, but delays investments and technology, as wants even better conditions than those agreed in the cooperation agreement for a period of 25 years.
It is difficult to imply another motive, because just as with Iran, Beijing behaves with Moscow, which has fallen under sanctions and needs international economic aid from its allies (circumvention of sanctions, new markets, establishment exports of raw materials and imports of technologies). To mask the overt blackmail, China has offered a new definition of its exaggerated “Oriental pragmatism”, calling tacit demands for maximum improvement in positions “optimization” of agreements.
Simply put, Beijing (China’s state-owned enterprises are involved in the deals) is shamelessly using its position and the position of its allies in a difficult situation in order to obtain the maximum possible profit. The expert gives an example that China pays Iran for its oil 10% less than even for heavily discounted Russian raw materials. And he wants to pay even less, especially in non-convertible yuan. The terms are almost unacceptable without the isolation of Tehran, which is likely to agree, Watkins concluded.
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