The agreement between Azerbaijan and Iran can become a long-term one: STRATFOR Analyst

STRATFOR global intelligence company expert Marco Papic expressed his comments on a recent Azerbaijani-Iranian agreement on gas supplies.

"The memorandum signed between Azerbaijan and Iran has the potential to open the door to long term cooperation, but it should be noted that the deal at present is relatively small. SOCAR is expected to deliver 500 million cubic meters of natural gas to Iran beginning in 2010, which is a drop in the bucket. Although the agreement stipulates that this volume can be increased gradually to as much as 5 billion cubic meters per year, to expand beyond that would require a substantial amount of new infrastructure to be built," Papic said.

Papic also believes that Azerbaijan has other options for exporting gas.

"Azerbaijan has more attractive export markets - such as to Europe through Turkey and to China through Central Asia - that it would likely consider over Iran. The agreement between Azerbaijan and Iran does not at present appear like a major deal, but it does have the possibility to expan," said the expert.

T. Teymur
Day.Az