US lawmakers to introduce bill to combat normalization with Syria

A bipartisan group of US Lawmakers plans to introduce a bill on Thursday intended to bar the US government from recognizing Bashar al-Assad as Syria's president and enhance Washington's ability to impose sanctions in a warning to other countries normalizing relations with Assad.

The bill would prohibit the US federal government from recognizing or normalizing relations with any government in Syria led by Assad, who is under US sanctions, and expands on the Caesar Act, a US law that imposed a tough round of sanctions on Syria in 2020.

The bill comes after Arab states turned the page on years of confrontation with Assad on Sunday by letting Syria back into the Arab League, a milestone in his regional rehabilitation even as the West continues to shun him after years of civil war.

Regional countries including Saudi Arabia, Qatar and others - had for years supported anti-Assad rebels, but Syria's army - backed by Iran, Russia and allied paramilitary groups - regained most of the country. The icy ties with Assad began to thaw more quickly after devastating earthquakes in Syria and Turkey in February 2023.

The United States has said it will not normalize ties with Assad and its sanctions remain in full effect.

The bill will be introduced by House of Representatives Foreign Affairs Committee Chairman Michael McCaul, Congressman Joe Wilson, the chair of the Subcommittee on the Middle East, North Africa, and Central Asia; and Democrats Steve Cohen and Vicente Gonzalez, among others, a senior congressional staffer who worked on the bill told Reuters.

The legislation is a warning to Turkey and Arab countries that if they engage with Assad's government, they could face severe consequences, the staffer, said speaking on condition of anonymity.

"The readmission of Syria to the Arab League really infuriated members and made clear the need to quickly act to send a signal," they said.

The bill's provisions include a requirement for an annual strategy from the secretary of state for five years on countering normalization with Assad's government, including a list of diplomatic meetings held between Syria's government and Turkey, the United Arab Emirates, Egypt and others.

The bill would also clarify the applicability of US sanctions on Syrian Arab Airlines and another carrier, Cham Wings. Under the proposed bill, countries that allow the airlines to land would face sanctions against that airport, the staffer said.

If passed, the bill would also require a review of transactions, including donations over US$50,000 in areas of Syria held by Assad's government by anyone in Turkey, the UAE, Egypt and several other countries.

 

Iran and Russia to facilitate Turkey and Syria in deescalating tension

After years of tensions, the foreign ministers of Turkey and Syria sat at the same table to discuss ways to deescalate tensions with help from Iran and Russia.

On Wednesday, Russia hosted an important quadrilateral meeting between Iran, Syria, Russia, and Turkey at the level of foreign ministers. The meeting was a giant step forward in terms of putting an end to differences between Turkey and Syria, which have been at loggerheads over the last decade. 

While some international issues have also been on the agenda, the Moscow meeting was primarily focused on the normalization of relations between Ankara and Damascus. The diametrically opposed positions of Syria and Turkey since the outbreak of the Syrian crisis in 2011 seriously have damaged their relations. With the Syrian government regaining control of much of its lost territory, Turkey moved to patch up relations with Syria with mediation and facilitation by Iran and Russia.

In the Wednesday meeting, this featured high on the agenda. The Russian foreign ministry said in a statement that the foreign ministers of the four countries held a substantive and frank discussion on issues related to resuming the interstate relations between Syria and Turkey in various aspects.

The Moscow meeting is another indication that Syria moving past crisis and war, a trend that prompted Turkey and many Arab states to restore ties with Damascus. Earlier this week, Syria was readmitted to the Arab League and Saudi Arabia reopened its diplomatic missions in Damascus. Currently, there are speculations that Syrian President Bashar Assad could take part in the upcoming summit of the Arab League in Saudi Arabia, which has already officially extended an invitation to Assad to participate in the summit. 

Turkey appears to be willing to keep up with this reconciliatory trend. In their meeting, the foreign ministers agreed to task the deputy foreign ministers to prepare a road map to advance the relations between Turkey and Syria in coordination with the work of the ministries of defense and special services of the four countries, according to the Russian statement. 

The statement added that the ministers noted a positive and constructive atmosphere of their exchange during the meeting and agreed to further maintain high-level contacts and technical talks in this quadripartite format in the upcoming period.

The Moscow meeting also provided a convivial atmosphere for the foreign ministers to hold bilateral meetings. The Iranian foreign minister, Hossein Amir Abdollahian held separate meetings with his Syria, Russian, and Turkish counterparts. 

In his meeting with Syrian Foreign Minister Faisal Mekdad, Amir Abdollahian congratulated him on Syria’s readmission to the Arab League and expressed Iran’s support for the Turkish-Syrian normalization. 

Amir Abdollahian described the Moscow meeting as a step forward in his meeting with Turkish Foreign Minister Mevlut Cavusoglu. The Turkish foreign minister, for his part, pointed to Iran’s important role in facilitating the quadrilateral meeting. 

As things stand, Turkey and Syria are making strides in restoring their ties. The full resumption of ties, however, is hindered by the fact that Turkish troops are illegally present in Syrian territory, thus contravening the Arab country’s territorial integrity. This point was raised in Moscow. 

In his speech at the joint meeting, Amir Abdollahian underlined that any political resolution to the Syrian issues must ensure Syria’s sovereignty over its entire territory, according to IRNA. 

Amir Abdollahian suggested that deployment of Syrian troops at the border regions can alleviate security concerns of Turkey and other neighboring countries, prevent terrorist and separatist activities, and set the stage for the withdrawal of Turkish military forces from the common border areas.

“We believe that a strong and independent Syria can overcome terrorism, separatism, occupation of American forces, and theft of the country's national resources,” he noted.

Iran’s top diplomat also stressed the need for joint efforts by regional countries and the rest of the international community to reconstruct Syria and prepare the ground for Syrian refugees to return to their homeland.

“Of course, any political precondition and double standards on this issue not only will not help solve this humanitarian issue but will also add to its complexity,” he pointed out.

The Iranian foreign minister pointed out that the beginning of talks between Syria and Turkey will benefit the people of the two countries and the security of the region.

“We deeply believe that these two countries can put the past behind them and resolve the bilateral issues through dialogue and deepening cooperation based on good neighborliness,” Amir Abdollahian said.

He also noted that the meeting in Moscow would have a strong message of peace and sustainable security in the region and strengthening of good neighborliness between Turkey and Syria.

 

Trade between Iran and Turkey reported at US$1.379 billion for Jan-Mar 2023 quarter

The value of trade between Iran and Turkey has been reported at US$1.379 billion during the first quarter of 2023, down 14% from US$1.619 billion in the first three months of 2022, according to the figures recently released by the Turkish Statistical Institute.

Turkey’s export to Iran rose 2% to US$702 million in the three-month period of this year, from $682 million in the same period of the previous year.

Iran’s three-month export to Turkey declined 27% to US$677 million from US$932 million.

Based on the data released by the Turkish Statistical Institute the value of Iran’s exports to Turkey increased by 19% to US$3.35 billion in 2022.

Turkey had imported over US$2.82 billion worth of commodities from the Islamic Republic in 2021.

Based on the mentioned data, Iran’s imports from the country also marked an 11% rise to US$3.07 billion in the past year, in comparison with 2021, when the figure was US$2.77 billion.

Trade between the two countries has registered a 15-percent rise in 2022.

The value of trade between the two neighbors reached US$6.42 billion in 2022, while the figure stood at US$5.59 billion in the preceding year.

Iran's trade balance with Turkey has been US$280 million positive in favor of Iran in the past year.

As announced by an official with Iran’s Trade Promotion Organization (TPO), the value of Iran’s export to Turkey increased by 23% in the past Iranian calendar year 1401.

Farzad Piltan, the director-general of TPO's Office of West Asian Countries, said that based on the data released by the Islamic Republic of Iran Customs Administration (IRICA), Iran exported commodities worth $7.45 billion to its neighbor in 1401, while the figure was $6.079 in 1400.

Saying that Turkey was Iran’s third top export destination in the past year, the official named natural gas, aluminum, urea, polyethylene, copper cathode and cathode parts, copper wires, iron and steel ingots, and polyethylene as the major products Iran exported to Turkey in the previous year.

Piltan further announced that Iran’s import from Turkey also rose 15 percent to about $6 billion in 1401, from $5.2 billion in 1400.

Stating that Turkey was the third source of import for Iran in the previous year, the official named sunflower seed oil, road tractors, corn, bananas, generators, barley, soybeans, synthetic fibers, crude soybean oil, and solid acrylic polymers as the main items Iran imported from its neighbor in 1401.

In last July, Iran and Turkey discussed ways of expanding economic relations along with political ties at the Turkish-Iranian High-Level Cooperation Council in Tehran.

During the meeting, which was co-chaired by Iranian President Ebrahim Raisi and Turkish President Recep Tayyip Erdogan, the two sides negotiated the extension of the gas export contract between the two sides for the next 25 years.

In the meeting, President Raisi noted that the Islamic Republic of Iran is determined to expand economic relations with neighboring countries.

The president also evaluated Tehran-Ankara ties as positive and progressive, saying that the two countries should pursue appropriate policies to move towards increasing their annual trade exchanges to $30 billion.

On the sidelines of the mentioned meeting, Iranian Energy Minister Ali-Akbar Mehrabian also held talks with Turkish Minister of Energy and Natural Resources Fatih Dönmez in which the two sides exchanged views on cooperation in energy fields.

Later on, Head of Turkey’s Small and Medium Enterprises Development Organization (KOSGEB) Hasan Basri Kurt met with Head of Iran Small Industries and Industrial Parks Organization (ISIPO) Ali Rasoulian to discuss ways of expanding cooperation between the small and medium-sized enterprises (SMEs) of the two countries.

In this meeting Rasoulian referred to the signing of a memorandum of understanding (MOU) between the two countries on cooperation between SMEs, saying: “President Raisi has emphasized setting up joint industrial parks in the country’s special economic zones, considering the good infrastructure for setting up such parks in the free and special economic zones and the active presence of economic enterprises in these areas.”

 

Iranian exports to Turkey up 23%

The value of Iran’s export to Turkey increased by 23 percent in the past Iranian calendar year 1401, an official with Iran’s Trade Promotion Organization (TPO) announced.

Farzad Piltan, Director General of TPO's Office of West Asian Countries, said based on the data released by the Islamic Republic of Iran Customs Administration (IRICA), Iran exported commodities worth US$7.45 billion to its neighbor in 1401, while the figure was US$6.079 in 1400.

Turkey was Iran’s third top export destination in the past year, the official named natural gas, aluminum, urea, polyethylene, copper cathode and cathode parts, copper wires, iron and steel ingots, and polyethylene as the major products Iran exported to Turkey in the previous year.

Iran’s import from Turkey also rose 15% to about US$6 billion in 1401, from US$5.2 billion in 1400.

Turkey was the third source of import for Iran in the previous year, the official named sunflower seed oil, road tractors, corn, bananas, generators, barley, soybeans, synthetic fibers, crude soybean oil, and solid acrylic polymers as the main items Iran imported from its neighbor in 1401.

The value of Iran’s exports to neighboring Turkey increased by 19% to US$3.35 billion in 2022.

Turkey had imported over US$2.82 billion worth of commodities from the Islamic Republic in 2021.

Iran's trade balance with Turkey has been $280 million positive in favor of Iran in the past year.

In last July, Iran and Turkey discussed ways of expanding economic relations along with political ties at the Turkish-Iranian High-Level Cooperation Council in Tehran.

During the meeting, which was co-chaired by Iranian President Ebrahim Raisi and Turkish President Recep Tayyip Erdogan, the two sides negotiated the extension of the gas export contract between the two sides for the next 25 years.

In the meeting, President Raisi noted that the Islamic Republic of Iran is determined to expand economic relations with neighboring countries.

The president also evaluated Tehran-Ankara ties as positive and progressive, saying that the two countries should pursue appropriate policies to move towards increasing their annual trade exchanges to US$30 billion.

On the sidelines of the mentioned meeting, Iranian Energy Minister Ali-Akbar Mehrabian also held talks with Turkish Minister of Energy and Natural Resources Fatih Dönmez in which the two sides exchanged views on cooperation in energy fields.

Later on, Head of Turkey’s Small and Medium Enterprises Development Organization (KOSGEB) Hasan Basri Kurt met with Head of Iran Small Industries and Industrial Parks Organization (ISIPO) Ali Rasoulian to discuss ways of expanding cooperation between the small and medium-sized enterprises (SMEs) of the two countries.

In this meeting Rasoulian referred to the signing of a memorandum of understanding (MOU) between the two countries on cooperation between SMEs, saying, “President Raisi has emphasized setting up joint industrial parks in the country’s special economic zones, considering the good infrastructure for setting up such parks in the free and special economic zones and the active presence of economic enterprises in these areas.”

 

Defense chiefs of Iran, Russia, Turkey and Syria to meet in Moscow on Tuesday

Turkish Defense Minister Halusi Akar announced that a joint meeting will be held between Iran, Syria, Russian, and Turkey in Moscow on Tuesday.

Akar announced that the meeting will be held at the level of defense ministers and heads of intelligence agencies.

The meeting comes after Moscow hosted the meeting of the deputy foreign ministers of the four countries.

Earlier this month, deputy foreign ministers of Iran, Russia, Syria, and Turkey held a meeting in Moscow to discuss the next meeting of the foreign ministers.

Russian Foreign Minister Sergey Lavrov delivered the opening speech of the meeting, which was held at the headquarters of the Ministry of Foreign Affairs.

The Moscow talks will serve as a prelude to the upcoming meeting between the foreign ministers of the four countries, according to the Turkish Anadolu news agency.

Ali Asghar Khaji, senior advisor to the Iranian foreign minister for special political affairs, who had traveled to Moscow at the head of a delegation to attend the four-way meeting, met separately with the deputy foreign ministers of Russia, Syria, and Turkey.

Also, Iranian Ambassador to Russia Kazem Jalali met in Moscow with Mikhail Bogdanov, the Special Representative of the President of Russia for the Middle East.

In the meeting, the latest planning for holding a quadrilateral meeting of foreign ministers on the Syrian issue was discussed, the Iranian embassy in Moscow said in a statement.

 

Is Iran-Azerbaijan tension being fueled by Israel?

The 2020 Nagorno-Karabakh war between Azerbaijan and Armenia had profound repercussions for Iran’s influence and policies in the South Caucasus. Tehran neither impacted the trajectory of the conflict nor exerted significant diplomatic influence in ceasefire negotiations and the ensuing peace agreement. 

Though Iran was the most relevant regional power in the conflict, bordering both Armenia and Azerbaijan, it was sidelined by Turkey and Russia. Tehran was obliged to align with Ankara and Moscow in supporting Baku’s territorial conquests, revealing a significant departure from its traditional pro-Armenia stance. 

From Iran's point of view, it is Tel Aviv that provokes Baku to take a belligerent policy against Tehran and to challenge the geopolitical status quo.

Azerbaijan did not reciprocate Iran’s good faith. Baku knowingly isolated Tehran in Nagorno-Karabakh’s reconstruction, while prioritizing Israel and Arab and European countries.

Backed by mighty military powers such as Turkey, Israel and Pakistan, Azerbaijan felt it could flex its muscles against Iran’s regional power projection. Recently, Baku hosted a joint military drill with Ankara and Islamabad, aiming to further strengthen ties among the three countries and to bolster counterterrorism efforts. 

The joint drill contradicts the provisions of the Convention on the Legal Status of the Caspian Sea, which bans the presence in the Caspian Sea of armed forces not belonging to the Parties" (Azerbaijan, Iran, Kazakhstan, the Russian Federation and Turkmenistan). 

On the margins of the drill, Baku tacitly challenged Iran’s connectivity with Armenia by disrupting Iranian trucks transiting a road that passes through Azerbaijan’s newly captured territories. Azerbaijan set up check points, began charging fees to Iranian trucks, and even detained two Iranian truckers.

Unlike Azerbaijan’s attempt to depict recent incidents as routine procedure, Tehran sees this new, assertive Azerbaijan in a bigger picture, where Baku plays the anti-Iran puppet role for other regional powers hostile to Iran, such as Israel. 

Tehran initially tasked the Revolutionary Guard Corps with deploying equipment and troops across the country’s northwestern border. But this was just a small part of Iran’s grand plan to intimidate Baku. Days later, Tehran launched its own military drill near the Azerbaijani border, saying "We will never tolerate the presence of the fake Zionist regime near the Iranian border, nor any changes in the regional borders and geopolitics”.

This rare move, alongside hawkish comments by Iranian officials, suggests that Tehran is indeed concerned about the potential for grave geopolitical changes near its borders. 

Iran’s Kayhan newspaper, a publication close to hardliners, claimed that based on a Turkish-American plan, Armenia’s western-oriented president, in collusion with Baku, intends to concede Armenia’s Syunik province to Azerbaijan. This is the only conceivable reason for Iran’s outrage at Azerbaijan. 

Syunik province separates the rest of Azerbaijan from the Nakhchivan Autonomous Republic exclave, and constitutes the Armenian border with Iran.

The 2020 peace deal between Azerbaijan and Armenia guaranteed Azerbaijan a corridor to connect Nakhchivan to the rest of Azerbaijan via Syunik province. Previously, all connections were made through Iran in the south or Turkey in the west. 

Baku is apparently not satisfied with this plan, and maintains an ambitious goal to take all of Syunik province, which could put Iran in a disadvantageous geopolitical position.

Tehran would lose its connection to Armenia and convenient access to the region, while being compelled to deal with a newly emboldened regional power that is heavily backed by Iran’s arch-enemy, Israel.

From Iran’s point of view, it is Tel Aviv that provokes Baku to take a belligerent policy against Tehran and to challenge the geopolitical status quo.

The title Tehran has chosen for its ongoing drills in the country’s northwest drives this point home ‑ Fatehan-e Khaybar is a call back to the Battle of Khaybar in the year 628, in which the Prophet Mohammed confronted the Jews of the Khaybar region, who were inciting Arabian tribes against the Muslims of Medina. 

Supreme Leader Ayatollah Ali Khamenei recently warned Azerbaijan against aligning with Israel noting, “Those who think that their security will be ensured by relying on foreigners should know that they will pay a hefty price.”

The type and scale of military equipment stationed at the border suggests that Iran intends to deter Baku from territorial adventurism, but Tehran ultimately wants to avoid an armed clash. If the situation deteriorates and Azerbaijan opts not to address Tehran’s concerns and warnings, Iran may cross the border to push preemptive deterrence from Armenian soil. A key factor at that point would be the extent to which Azerbaijan’s allies, primarily Turkey, would be prepared to support Baku and participate in a direct confrontation with Iran. 

Meanwhile, Iran seems determined not to step back without affirming its national security red lines, establishing a credible level of deterrence, and asserting its undeniable regional role, which has been somewhat tarnished amid the recent security developments in the South Caucasus. 

Iraq key destination of Chinese investment

In recent years, Iraq has become one of the leading destinations for Chinese investments in the Middle East and a crucial link in Beijing's Belt and Road Initiative (BRI).

To capitalize on its geostrategic location and central position within the Chinese BRI, Iraq is seeking to develop a sprawling new 54-square-kilometer port project in the far southern town of al-Faw, known as al-Faw Grand Port, which will reduce the country’s reliance on Arab Gulf ports and overland transit from Iran and Turkey for its imports.

The project also underscores Iraq’s growing economic rivalry with neighboring Iran, as both countries seek to carve out a similar niche in handling regional transit traffic.

A number of hurdles have hampered Iraq’s efforts to diversify its economy, including extreme underinvestment and widespread corruption. There are some signs that change may be on the horizon.

Earlier this month, Baghdad reached an agreement with France’s TotalEnergies to move forward with a massive, long-delayed US$27 billion energy project, highlighting the potential for foreign investment and partnerships to contribute to Iraq’s economic growth and development.

This follows an earlier deal, announced in July 2021, between the Iraqi Ministry of Oil and China National Chemical Engineering Co. (CNCEC), whereby CNCEC will develop an integrated petrochemicals and refining complex at al-Faw capable of producing 300,000 barrels per day (bpd) of oil as well as, in a later second phase, 3 million tons per annum (mtpa) of petrochemicals.

International companies are increasingly showing interest in investing in Iraq's energy and infrastructure sectors in particular. This could help to improve the country’s economic prospects and reduce its reliance on oil exports, which accounted for 95% of its federal budget revenue in 2022.

The success of projects like these will depend on a range of factors, including security conditions, political stability, and the government’s ability to create a favorable investment climate.

The al-Faw project includes the construction of a new port, dry dock, oil terminal, dry canal, and associated transportation infrastructure, and once completed, it is expected to become one of the main pillars of Iraq's economy. According to recent reports, phase one is set to be finished in 2025 and will have the capacity to handle 20-45 mtpa of cargo.

The dry canal will provide land connectivity to the Turkish border via road and rail, linking up with port and rail infrastructure in Turkey, especially in Mersin and Istanbul. If successfully completed, al-Faw could leverage its location and connectivity with Turkey and Syria to become a leading container terminal and one of the largest ports in the world.

In December 2022, Basra hosted the second al-Faw International Conference, the focus of which was to highlight the al-Faw port and dry canal. Iraq’s central goal is to link this project with China's broader BRI and bill it as part of an alternative route to the Suez Canal and the North-South Corridor. China’s overall investment in the Middle East, North Africa, and Turkey between 2005 and 2022 totaled US$273 billion.

Iraq has become an increasingly important partner for China in recent years, with a particular focus on the energy sector. Beijing inked deals with Baghdad worth US$10.5 billion in 2021 alone.

Chinese companies have secured contracts to develop and operate several major oil and gas assets, including the Rumaila and Halfaya oil fields. Chinese firms have also been involved in building and operating power plants and other infrastructure projects in Iraq, in addition to investing in telecommunications and agriculture. China's investments have contributed significantly to Iraq’s economic development and have strengthened economic ties between the two countries.

The focus on al-Faw and China’s investments in Iraq has also underscored neighboring Iran’s limited role in international transit and trade, an area in which Tehran punches far below its weight. Given its central location and status as a land bridge between South and Central Asia and the Middle East, Iran should play a major role in both the East-West and North-South corridors — the former connects the Caucasus, Central Asia, and China to the Middle East and Europe via Iran, while the latter links Russia and Central Asia to the Persian Gulf and India through Iran — but Tehran has not capitalized on either opportunity.

Despite its natural advantages, Iran has failed to become an important strategic hub for the transportation of goods due to a combination of factors, including economic sanctions, political instability, and outdated transportation infrastructure, especially for railways and ports.

The development of al-Faw Port in Iraq could represent a further challenge to Iran’s aspirations in this area. Ali Hosseini, the head of the Transport and Logistics Commission of the Iran Chamber of Commerce, believes that, in the future, al-Faw will become a major competitor for Iran.

With help from Turkey and the UAE, Iraq is trying to link al-Faw to Iraq’s national railway and connect that railway to Turkey in the north, creating an alternative transportation corridor that will likely have a negative impact on Iran's transit traffic to Turkey.

At present, an estimated 90% of transit traffic through Iran moves by road. While there is an existing railway between Iran and Turkey, it is limited and often disrupted by political tensions between the two countries.

The volume of trade between Iran and Turkey is significant, reaching US$6.42 billion in 2022, up from US$5.59 billion the year before, but the lack of reliable transportation infrastructure has hindered its growth.

Officials in Tehran have accused the United States of interference and suggested that Baghdad is under pressure from Washington to impede Iran’s development of a viable north-west transit corridor.

They also claim that Turkey is exerting influence on Iraq to back its railway link to Asia, in line with Ankara’s ambition of becoming a regional hub for energy and communication.

As a result, it is highly likely that Iran will use Iraq’s actions in this space as leverage in their bilateral negotiations over energy and agricultural trade, and this could potentially strain the relationship between the two countries in the future.

 

Baghdad-KRG deal to resume oil exports

Iraq's federal government and the Kurdistan Regional Government (KRG) are close to striking a deal aimed at resuming northern oil exports, four sources familiar with the discussions told Reuters on Saturday.

Turkey stopped pipeline flows from the Kirkuk fields in northern Iraq's semi-autonomous Kurdistan region to its port of Ceyhan on March 25, after it lost an arbitration case brought by Baghdad.

In the case, Iraq accused Turkey of violating their 1973 pipeline agreement by allowing the Kurdish government to export oil without Baghdad's consent between 2014 and 2018.

The halted flows of around 450,000 barrels per day (bpd) only accounted for about 0.5% of global oil supply, but the stoppage, which forced oil firms operating in the region to halt output or move production into rapidly-filling storage tanks, still helped boost oil prices last week back to near US$80/bbl.

An initial agreement between the two sides states that Iraq's northern oil exports will be jointly exported by Iraq's state-owned marketing company SOMO and the KRG's ministry of natural resources (MNR), according to two of the sources – a senior Iraqi oil official and a KRG official.

Revenues will be deposited in an account managed by the MNR and supervised by Baghdad, the KRG official said.

The preliminary agreement has been sent to Iraq's prime minister for final approval, according to two of the sources. The KRG source expects the deal to be confirmed by Monday.

The KRG declined to comment. Iraq's oil ministry spokesman could not immediately be reached outside regular business hours.

Baghdad and the KRG have agreed to continue meetings following the resumption of oil exports to find solutions to other lingering problems.

"[These include] the contracts of the foreign companies operating in Kurdistan and the Kurdish debts," the senior Iraqi oil official said.

With its oil exports at a standstill, Kurdistan had halted repayments to energy traders including Vitol and Petraco on crude cargo deals worth US$6 billion, trading sources said.

Another sticking point in discussions so far has come from the Turkish side.

A second arbitration case relating to the 1973 pipeline agreement for the period from 2018 onwards remains open, and one source said this could take around two years to settle.

Turkey wants that case resolved before reopening the pipeline, three sources told Reuters.

A Turkish senior official said Turkey has yet to be informed about the initial agreement by the KRG or federal Iraqi officials and that discussions are ongoing.

Iraq halts northern crude oil exports to Turkey

Iraq halted 450,000 barrels per day (bpd) of crude exports from the semi-autonomous Kurdistan region and northern Kirkuk fields on Saturday, an oil official told Reuters, after the country won a longstanding arbitration case against Turkey.

In a case dating from 2014, Baghdad claimed that Turkey violated a joint agreement by allowing the Kurdistan Regional Government (KRG) to export oil through a pipeline to the Turkish port of Ceyhan. Baghdad deems KRG exports as illegal.

"Iraq was officially informed by the International Court of Arbitration final ruling on Thursday and it was in favour of Iraq," a senior oil ministry official said.

Turkey informed Iraq that it will respect the arbitration ruling, a source said.

Turkish shipping officials told Iraqi employees at Turkey's Ceyhan oil export hub that no ship will be allowed to load Kurdish crude without the approval of the Iraqi government, according to a document seen by Reuters.

Turkey subsequently halted the pumping of Iraqi crude from the pipeline that leads to Ceyhan, a separate document seen by Reuters showed.

On Saturday, Iraq stopped pumping oil through its side of the pipeline which runs from its northern Kirkuk oil fields, one of the officials told Reuters.

Iraq had been pumping 370,000 bpd of KRG crude and 75,000 bpd of federal crude through the pipeline before it was halted, according to a source familiar with pipeline operations.

"A delegation from the oil ministry will travel to Turkey soon to meet energy officials to agree on new mechanism to export Iraq's northern crude oil in line with the arbitration ruling," a second oil ministry official said.

Defending submarine cables in Back Sea

Deep in the world’s oceans and seas lies a network of submarine communication cables connecting continents and regions. This critical infrastructure, owned mostly by international consortia of private telecommunication companies, spans, in total, more than 1.3 million kilometers and handles over 95% of the world’s data.

The rise of projects like SpaceX’s Starlink and their use in the war in Ukraine has increased the attention on satellites and space security. However, submarine cables remain a crucial yet underappreciated part of the global communications system. The widespread use of these cables by private individuals, businesses, and government agencies makes their protection a matter of national and international security.

As fighting rages on in Ukraine, the cables in the Black Sea could be in danger of disruption. Accidents have caused damage to the cables in the past, and stepped-up naval activity in the region could raise the risk of vessels accidentally cutting the lines lying on the seafloor.

Moreover, deliberate Russian attacks on these cables, either through cyber operations or physical destruction, follow the Kremlin’s modus operandi of targeting critical infrastructure to gain strategic advantage without necessarily delivering decisive blows against its enemies.

To ensure regional security in the communication and data spheres, Black Sea states must increase their emphasis on protecting submarine cables, including within the format of the North Atlantic Treaty Organization (NATO) or novel regional frameworks.

Unlike the attacks on land-based power grids and energy pipelines, the threat to submarine cables is still a hypothetical national security concern as no definitive case of sabotage by a state actor has been confirmed thus far.

However, some defense officials, notably the chief of the British Defense Staff, Admiral Tony Radakin, have begun to emphasize the security implications of the cables’ vulnerabilities, especially in the context of the Russian invasion of Ukraine.

Russia has been investing in capabilities that would allow specialized submarines to place explosives on the seafloor, physically endangering underwater communication infrastructure. In addition to the Russian navy, the Main Directorate of Deep-Sea Research (GUGI) — known as Russia’s “Deep-Sea Spetsnaz” — can undertake covert operations along the seabed.

NATO officials suspect that GUGI has been increasingly focusing on undersea cable networks in recent years. Notably, in January 2022, Norway detected damage to one of two fiber optic cables off the Svalbard archipelago; suspicions that the cable disruption may have been intentional grew later that year, after a mysterious explosion crippled the underwater Nord Stream natural gas pipeline, an incident that is still under investigation.

Skeptics argue that such concerns are exaggerated, especially since companies that own these undersea networks have been building redundancies to provide different data flow routes in case of a disruption to one cable.

Of the four Black Sea submarine cables, the only one physically connected to the territories in conflict is the Kerch Strait Cable, which links the occupied Crimean Peninsula with the Russian mainland. Not only is the cable owned by Rostelecom — Russia’s largest telecom firm — but any disruption to communications and internet in Ukraine through sabotage would affect Russian forces on the ground as well.

The primary objective of such an attack on submarine cables would be to create confusion and anxiety among the affected populations. The Kremlin could also order sabotage operations on cable networks connected to Ukraine’s allies in North America and Europe specifically to exacerbate the growing war fatigue caused by high inflation and gas prices.

Other than the Kerch Strait Cable, Rostelecom also owns the Georgia-Russia cable system in a joint venture with Georgian and Danish companies. Stretching across the Black Sea, the Caucasus Cable System, owned by Caucasus Online, connects Georgia and Bulgaria. In the west, Türk Telekom International operates the Black Sea Fiber Optic System (KAFOS), which has landing points in Turkey, Bulgaria, and Romania.

Yet a multinational security apparatus — whether through NATO or a Black Sea regional defense cooperative — is needed to help private companies successfully defend existing systems and launch future projects. The war in Ukraine has exposed NATO’s deficiencies in preventing and responding appropriately to potential Russian sabotage operations on critical infrastructure.

Measures taken by private companies to implement redundancies to limit the impact of individual disruptions will mitigate the risks of widespread internet blackouts. And if NATO states invested more in the defense of these networks, Russia would lose a potential point of leverage against the Alliance.

NATO defense ministers highlighted the importance of identifying the threats posed to submarine infrastructure, particularly by the Russian navy. As part of this effort to enhance security, NATO tasked Joint Force Command Norfolk (JFC-NF) to monitor and protect these networks in the Atlantic.

Introducing a similar mission concept to the Eastern Mediterranean and Black Sea regions could be a productive step in ensuring the security of NATO’s exposed southeastern flank. The next iteration of the Black Sea Maritime Forum, first convened on February 25 of last year, could provide the appropriate platform to advance this issue and discuss solutions among Black Sea states with NATO involvement.

Regionally, coordinating strategic interests among the Black Sea states, especially with NATO, has always been a challenge. Despite Romania’s vocal support for an increased NATO presence in the region, the lack of enthusiasm from Turkey and Bulgaria has hindered progress toward sufficient Black Sea defense.

Turkey’s hesitation may be because of its “middleman” approach to the competition between Russia and the United States. Even as Russian aggression continually destabilizes the Black Sea region, Turkish President Recep Tayyip Erdoğan remains unwilling to fully commit to the West’s punitive stance against Moscow.

Turkey’s expanded trade relations with Russia, despite increasing pressure from the US to abide by Western sanctions, and its foot dragging on ratifying Finland and Sweden’s accession to NATO, demonstrate the country’s insistence on prioritizing its own security concerns, even at the expense of hindering a united Euro-Atlantic front.

However, Turkey must not overlook the importance of securing the critical infrastructure networks in the Black Sea, including submarine communication cables, especially as one of them — KAFOS — has a landing point in Istanbul, near the Bosporus Strait. Given Ankara’s interest in minimizing the risk of escalation in the Russo-Ukrainian war, it should contribute to the broader Black Sea region’s underwater domain awareness as well as monitor key vulnerabilities that could be exploited or put at risk by a malign actor — whether Moscow or anybody else.

Short of a wider North Atlantic Alliance mission, Turkey should actively cooperate with other Black Sea states, including non-NATO member Georgia, in pursuing their own regional security framework that would include as its mission the protection of submarine cables in the Black Sea.

Saudi Arabia raises over SR145 million for earthquake victims

The King Salman Humanitarian Aid and Relief Center (KSRelief) announced that as of Thursday evening, donations worth over SR145 million have been raised during the ongoing popular fundraising campaign to alleviate the suffering of the earthquake victims in Turkey and Syria.

“The Saudi teams are determined to deliver aid to those affected by the devastating earthquake despite the obstacles. The Saudi humanitarian assistance will reach the needy wherever they are,” KSRelief said in a statement carried by the Al-Arabiya channel.

Two planeloads of Saudi relief supplies have already arrived in Turkey and a third plane, carrying relief supplies, is ready to leave for Turkey, the KSRelief said, adding that the Saudi relief mission is currently working on the ground in Turkey.

The Saudi popular campaign, launched by KSRelief on Wednesday, through the Sahem electronic platform, had raised SR80 million on the first day itself and the Saudi air bridge operation started dispatching relief supplies to Turkey and Syria. Specialized Saudi medical teams and rescue teams reached Adana Airport in the quake-hit Turkish region at dawn on Thursday.

The popular fundraising campaign was launched in implementation of the directives of Custodian of the Two Holy Mosques King Salman and Crown Prince and Prime Minister Mohammed bin Salman.

Dr. Abdullah Al-Rabeeah, advisor at the Royal Court and general supervisor of the KSRelief, inaugurated the campaign at KSRelief headquarters in Riyadh. He said that the volume of donations collected even before the launch of the campaign amounted to more than SR13 million and this embodies the commitment of the Saudi people and their response to succor the earthquake victims in Turkey and Syria.

The death toll from the quakes, which struck early on Monday morning, passed 19,000 on Thursday across both Turkey and Syria. That surpasses the more than 17,000 people killed in 1999 when a similarly powerful quake hit Turkey’s more densely populated northwest.

Cold, hunger, and despair gripped hundreds of thousands of people left homeless by earthquakes in Turkey and Syria on Thursday, while hopes faded of many more people being found alive amid the ruins of cities. Hundreds of thousands of people across both countries have been left homeless in the middle of winter. Many have camped out in makeshift shelters in supermarket car parks, mosques, roadsides, or amid the ruins, often desperate for food, water, and heat.

Central banks bought the most gold in 2022

Central banks around the world added a whopping 1,136 tons of gold worth some US$70 billion to their stockpiles in 2022, by far the most of any year since 1967, the World Gold Council (WGC) said on Tuesday.

The data underlines a shift in attitudes to gold since the 1990s and 2000s, when central banks, particularly those in Western Europe that own a lot of bullion, sold hundreds of tons a year.

Since the financial crisis of 2008-09, European banks stopped selling and a growing number of emerging economies such as Russia, Turkey and India have bought.

Buying dipped during the coronavirus pandemic but accelerated in the second half of 2022, with central banks purchasing 862 tons between July and December 2022, according to the WGC.

Banks including those of Turkey, China, Egypt and Qatar said they bought gold last year. But around two-thirds of the gold bought by central banks last year was not reported publicly, the WGC said.

Banks that have not regularly published information about changes in their gold stockpiles include those of China and Russia.

"Central bank buying in 2023 is unlikely to match 2022 levels," the WGC said.

"Lower total reserves may constrain the capacity to add to existing allocations. But lagged reporting by some central banks means that we need to apply a high degree of uncertainty to our expectations, predominantly to the upside."

The central bank purchases took total gold global gold demand last year to 4,741 tons, up 18% from 2021 and the highest for any year since 2011.

 

 

Ukraine-Russia Grain Deal: Success or Failure

On October 29, 2022 Russia announced it had quit the grain deal brokered by the UN and Turkey in July 2022 to allow Ukraine to export grain by the Black Sea. Moscow’s move was in response to an attack by Ukraine on the Russian fleet around Sevastopol city. Despite Russia’s warnings, a group of ships loaded with grain nonetheless exited through the safe corridor, exporting grain that had been loaded in Ukrainian ports.

Shortly thereafter, Russia made a U-turn and announced it would return to the agreement after negotiations with Turkey. Moscow cited written guarantees from Ukraine that Kyiv would not use this corridor for military purposes or attacks against Russia.

This brief spat over the deal, which to that point had worked for all parties, left a mixed impression. On the one hand, Russia’s actions underscored that the agreement was vulnerable and weak, and made clear Moscow’s readiness to abandon it at any moment it saw fit. On the other hand, Turkey’s intervention, which secured the continuation of the deal and convinced the Kremlin to rejoin it, illustrated the significant influence Ankara wields in the Black Sea, both as a key interlocutor between parties and as a counteracting player to Russia.

Russia’s move was inevitable. From the very beginning Moscow has seen the grain deal as affording it leverage over Ukraine and the West. Grain exports are one of the few sources of hard-currency income for the Ukrainian economy. What is more, being a security guarantor of the agreement allows Russia to raise the stakes with minimal effort every time it wants to pressure the West by destabilizing world food prices, which in turn has an impact on inflation worldwide. Indeed, Russia’s brief suspension of its participation in the grain deal caused a spike in wheat prices across the globe.

The most obvious goal of the deal was to ensure food security. Russia’s invasion of Ukraine caused a surge in global food prices, dealing a heavy blow to countries already at risk of food insecurity. Ukraine has been one of the world’s largest exporters of grain, contributing 42% of the global share of sunflower oil, 16% of maize, and almost 10% of wheat. Not only are Ukraine’s exports essential for the stability of world markets, but Ukraine’s grain exports have also contributed greatly to the World Food Program’s humanitarian stocks, shipped regularly to such war-ridden countries as Yemen, Ethiopia, Somalia, and South Sudan.

The July agreement between Russia and Ukraine allowing grain and fertilizers to return to the market probably averted a humanitarian catastrophe and economic meltdown. Since the signing of the deal, around 9.5 million tons of grain products have left Ukraine by sea. More than 100 ships have sailed from Ukraine, with 47% of the grain cargoes going to Turkey and Asian countries, 36% going to the EU, and 17% to Africa. Immediately after the agreement went into effect, food prices fell by 7.90 percent since March 2022. After hitting an all-time high immediately after Russia’s invasion in February 2022, world wheat prices dropped by 14.5% and cereal prices dropped by 11.5%. Prices for those grains are still higher than they were in 2021, but the deal certainly eased pressure on the market. In terms of stabilizing markets, the deal has proved to be effective.

However, the agreement was not designed to save conflict-affected communities around the world, which for the most part continue to suffer critical food shortages. Particularly, Russia has constantly criticized the agreement, alleging that the grain is not reaching countries that need it the most.

Indeed, contrary to popular perception, the majority of grain exports that were shipped out of Ukrainian Black Sea ports didn`t go to the poorest and most needed countries but rather to Europe and Turkey. Over the past five months, more than 12.3 tons of grain was shipped from Ukraine, with 44% of it being corn rather than wheat. The main destinations of the cargoes were Spain, China, Turkey, Italy, and the Netherlands.

Most of the grain that had been held up in Ukrainian silos after February 24 was corn, contracted by international companies, not necessarily to feed people but, for example, to use as biofuel or animal food. Therefore, the agreement wasn’t designed to immediately avert famine in countries like Yemen or Somalia but rather to stabilize the market and contain prices, which in turn hurt countries’ ability to purchase food.

From the Ukrainian perspective the agreement has positive implications. It allowed Ukraine to return to almost prewar amounts of exports, increasing its share from 1–1.5 million tons to almost 4 million tons.

In addition, the deal freed up some space for Ukraine to store the next harvest, which is expected to amount to 53 million tons, far exceeding domestic needs. The deal allows Ukrainian farmers to start planting crops for next year.

The deal also ensures that Ukraine’s farming sector is not totally destroyed. Because of the war, Ukraine’s farming industry has lost 50% of its 2021 gross output, which has led to serious liquidity problems for farmers. The grain had to be moved out of storage silos to avert a storage crisis, and if the whole goal of the deal was to move grain out of Ukraine, then the treaty made it possible.

Any hope that the grain deal might serve as a basis for the slow build-up of a potential compromise between Russia and Ukraine/the West has been dashed.

Ukraine and Russia don’t trust each other and are not ready to negotiate. Russia’s attempt to abandon the deal demonstrated that Moscow doesn’t see it as a trust-building measure but rather is trying to instrumentalize it as part of its war effort. Nor does Ukraine see the agreement as part of a potential peace process. President Zelensky insists that Russia should leave all Ukrainian territory occupied since 2014, including Crimea, no matter whether there is a grain agreement in place or not.

If the agreement is thought of as a means of stabilizing the Black Sea situation and localizing the war in Ukraine, then one could argue it has partially succeeded. Although Russia didn’t stop its indiscriminate attacks against energy, military, and civilian infrastructure in Ukraine’s South, it did show restraint toward foreign ships, which started shipping grain out of Ukraine through the Turkey-supervised safe corridor. In some way, the agreement has contributed to the creation of certain rules.

Finally, if the agreement was about strengthening Turkey’s geopolitical leadership in the region, then it has definitely succeeded. Ankara boosted its diplomatic image by presenting the agreement as an achievement aiding food-dependent African and Asian countries. Moreover, Turkey cemented its role as a key mediator in the Russia-Ukraine war, capable of talking to both sides. President Erdoğan in particular has been able to capitalize on the deal by placing Turkey at the heart of any potential follow-up agreements between Kyiv and Moscow.

 

Pentagon warns Turkey against attacking Syria

The Pentagon has warned NATO member, Turkey against a new military operation in Syria. The Turkish strikes in Syria late last month endangered US troops and caused casualties for their partner forces. 

Defense Secretary Lloyd Austin on Wednesday spoke by phone with his Turkish counterpart, conveying his strong opposition to a new Turkish military operation in Syria. 

Austin expressed concern over escalating action in northern Syria and Turkey, including recent airstrikes, some of which directly threatened the safety of US personnel who are working with local partners in Syria to defeat ISIS.  

Secretary Austin called for de-escalation, and shared the Department’s strong opposition to a new Turkish military operation in Syria. 

Turkish President Recep Tayyip Erdoğan last month launched airstrikes on northern Syria and Iraq targeting Kurdish groups in the two neighboring countries. Ankara claims the strikes are in retaliation for a November 13, 2022 bombing in Istanbul that killed six people and injured 80 more. 

Erdoğan also suggested on November 23 that he also plans to order a ground invasion into northern Syria. 

The US has notably partnered with the Kurdish-led Syrian Democratic Forces (SDF) in the effort to defeat ISIS in the region and continues to work with the group to keep the terrorist group at bay. 

Since the Turkish strikes, the US military is operating at a reduced number of partner patrols with the SDF, Pentagon press secretary Brig. Gen. Pat Ryder told reporters Thursday.  

Ryder noted that while the US recognizes Turkey’s security concerns, the focus here is on preventing a destabilizing situation, which would put ISIS in an ability to reconstitute. 

He added that the US has frequent and open lines of communication with its Turkish allies at a variety of levels. 

“We did issue a statement highlighting the fact that a strike did come close to US personnel, and we clearly have communicated that,” he said. 

 

Turkey warns oil shippers

Turkey warned the oil shippers they will need to prove they’re insured to cross the country’s vital straits, a move that could restrict flows of Russian oil as new European sanctions kick in.

The new rule starts December 01, 2022 a few days before the European Union and UK impose additional curbs on Russian trade that will make it much harder for tankers carrying the nation’s oil to get insurance. 

The insurance covers everything from oil spills to collisions, Turkey is in effect seeking to protect its waters, but it could also affect the flow of millions of barrels of Russian crude exports.

Ships hauling oil through the waterway and the nearby Dardanelles strait will be required to provide a letter from their insurer saying that cover will be provided for that specific vessel voyage and cargo, the Turkish Ministry of Transport said in a circular.

The European Union and the UK commence aggressive sanctions on Russian oil shipments on December 05, 2022 that will dramatically affect the availability of industry standard insurance. 

Russia shipped almost 650,000 barrels a day of its own oil through the straight from its Black Sea port of Novorossiysk over the past six months, loading programs compiled by Bloomberg show. A nearby Russian port exported almost 1.3 million barrels a day of cargo from Kazakhstan.

A director from the Turkish institution governing maritime traffic confirmed the letter, and said the motive behind it was to comply with EU sanctions even though Turkey is not part of them. 

The director said the move could well impact Russian tankers if they struggle to obtain the necessary protection and indemnity insurance, which covers owners against liabilities such as oil spills. The measure should boost maritime safety along the Turkish straits, he said.

Under the EU and UK sanctions, vessels will still be able to get industry standard cover, provided the cargoes being transported are purchased below a yet-to-be-determined price cap.

If ships sail through the straits uninsured, there could be significant damage to the waterway and vessel traffic could come to a standstill if an uninsured ship has an accident, the circular said. As a result, a letter guaranteeing insurance cover is considered a solution to this problem, it added. 

The International Group of P&I Clubs is based in London and organizes the cover of 95% of the global tanker fleet. It’s also reliant on Europe for reinsurance.

 

Iran Emerging Regional Transit Hub

For thousands of years, Iran has been an important route for the transit of foreign goods due to its geopolitical position. The country played a significant role in transporting commodities from west to east as one of the main stations along the ancient Silk Road.

In the modern day, this huge capacity became dormant due to war, political conflicts, and sanctions and consequently lack of infrastructure. Now the global conditions are changing in Iran’s favor and new opportunities have appeared on the horizon.

The Ukraine war, despite its grave consequences for many countries, has presented Iran with a golden opportunity to realize the long-awaited goal of becoming the global transit hub it once was.

The row between Europe and Russia over the Ukraine war, which resulted in harsh sanctions being imposed on the country, cornered the Russian government economically and many European countries closed their borders on Russian goods making it very hard for its traders to be able to access their destination markets. As a result, the country started looking for new ways for distributing its goods across the world, especially in Asia and the International North-South Transit Corridor (INSTC) once again came under the spotlight.

The agreement for launching INSTC was signed by Iran, India, and Russia in 2000. Despite all the interest and hype, the attention to the route faded due to geopolitical hurdles including the global economic stagnation, the US sanctions on Iran, the conflict in Karabakh, and the pandemic.

Now the multi-modal network of ships, rail, and roads is once again gaining its importance, as the most important trade link between Asia and Europe.

According to official data, one of the major advantages of this transportation route is that the cost of transporting goods through this corridor is 30% cheaper. It also halves the time it takes to transport Indian goods to Russia via the Suez Canal.

Iran can use this transit route to distribute European commodities in the shortest possible time and at a lower cost than other routes to the Indian Ocean and the Persian Gulf.

It is predicted that after the full operation of INSTC, Iran will be able to earn US$20 billion in transit profits annually, something helping it reduce its dependence on oil revenues amid the American ban on the sector.

Iran has been taking serious measures for the development of its railway network as well as its ports and shipping infrastructure in order to encourage more countries to join the project.

Using the capacities of INSTC, Iran will be able not only to expand the volume of trade with Russia and the countries of the region; it can also gain a huge share of the mentioned countries’ annual transit.

Currently, Russia has proposed to take part in some railway projects in Iran in order to accelerate the development of the Islamic Republic’s railway network along the mentioned route.

Last week, Igor Yevgenyevich Levitin, aide to the president of the Russian Federation, visited Iran on top of a high-ranking delegation to meet with Iranian Transport and Urban Development Minister Rostam Qasemi and discuss the expansion of transport ties.

According to the Iranian Transport Ministry, Levitin was tasked by Russian President Vladimir Putin to take the necessary measures for the implementation of Iran’s Rasht-Astara railway and the signaling of the country’s Incheh Borun-Garmsar railway line (both of which are along the INSTC route).

Besides linking India to Europe via this corridor, Iran can connect Central Asia to the Indian Ocean and the Persian Gulf. Landlocked countries in Central Asia can use the corridor's railway to access the high seas. Over time, Iran's place in the corridor would become known to all.

Kazakhstan, Turkmenistan, Turkey, Iraq, and Afghanistan have also shown interest in joining the huge project by linking their railways to that of Iran.

Earlier this month, Kazakhstan reached an agreement with the Islamic Republic of Iran for using the country’s rail network and the southern Shahid Rajaee Port for transiting goods to the Central Asian and Commonwealth of Independent States (CIS) regions.

Iran has also been seeking to join its railway with Iraq in order to use the Arab country to facilitate access to the Syrian market, this way Syria can also be somehow linked to the INSTC.

The rail and sea route can also join the Chinese Road and Belt project, which seeks to revive the ancient Silk Road. As one of Iran’s major trade partners China has also shifted to Central Asia and the Caspian Sea to transit its goods to Europe after the eruption of the Ukraine crisis and Iran could play a significant role in delivering Chinese goods to their destinations.

The current international conditions have presented Iran with a proper opportunity to play a bold role in the broader implementation of the INSTC and to transform into a regional trade hub by developing its rail and transit infrastructure.

Given the lower costs and shorter time of trade via this route, Iran can become the main trade link between Asia and Europe and effectively neutralize the US measures aimed to isolate Iran from the global economy.

 

 

Can Black Sea grain deal survive without Russia?

According to a Reuters report, United Nations, Turkey and Ukraine pressed ahead to implement a Black Sea grain deal and agreed on a transit plan for Monday for 16 vessels to move forward, despite Russia's withdrawal from the pact that has allowed the export of Ukrainian agricultural products to the world markets.

Russia, which invaded Ukraine on February 24 this year, on Saturday halted its role in the Black Sea deal for an indefinite term, cutting shipments from one of the world's top grain exporters, because it said it could not guarantee safety of civilian ships travelling under the pact after an attack on its Black Sea fleet.

The move has sparked an outcry from Ukraine, NATO, the European Union and the United States, while the United Nations and Turkey, two main brokers of the July deal, scrambled on Sunday to save it.

UN Secretary-General Antonio Guterres was deeply concerned about Russia's move and delayed a foreign trip to try and revive the agreement that was intended to ease a global food crisis, his spokesperson said.

Following Russia's move, Chicago wheat futures jumped more than 5% on Monday as both Russia and Ukraine are among the world's largest wheat exporters, analysts said.

More than 9.5 million tons corn, wheat, sunflower products, barley, rapeseed and soy have been exported since July. Under the deal, a Joint Coordination Centre (JCC) - made up of UN, Turkish, Russian and Ukrainian officials - agrees on the movement of ships and inspects the vessels.

No ships moved through the established maritime humanitarian corridor on Sunday. But the United Nations said in a statement that it had agreed with Ukraine and Turkey on a movement plan for 16 vessels on Monday - 12 outbound and 4 inbound.

It said the Russian officials at the JCC had been told about the plan, along with the intention to inspect 40 outbound vessels on Monday, and noted that "all participants coordinate with their respective military and other relevant authorities to ensure the safe passage of commercial vessels" under the deal.

During Sunday's session among the grain deal delegations, Russian officials said Moscow will continue the dialogue with the United Nations and the Turkish delegation on pressing issues, the UN said in its statement.

Turkish Defence Minister Hulusi Akar was in contact with his Russian and Ukrainian counterparts to try and salvage the agreement and had asked the parties to avoid any provocation, the Turkish defence ministry said.

NATO and the European Union have urged Russia to reconsider its decision. US President Joe Biden on Saturday called Russia's move purely outrageous and said it would increase starvation. US Secretary of State Antony Blinken accused Moscow of weaponizing food.

On Sunday, Russia's ambassador to Washington snapped back, saying the US response was outrageous and made false assertions about Moscow's move.

Turkey-Israel love affair

A Turkish warship has docked in Israel for the first such visit in more than a decade as relations between the allies of United States improve following fierce feuding over the Palestinian cause.

The frigate Kemalreis docked in Haifa on Saturday as part of NATO manoeuvres in the Mediterranean Sea, a Turkish official said. An Israeli official said Ankara had submitted a preliminary request for the crew to disembark on shore leave.

A Haifa port official said it was the first time a Turkish naval vessel had visited since at least 2010, when bilateral ties were shattered by Israel's storming of a pro-Palestinian aid convoy that tried to breach its blockade of the Gaza Strip, ten Turks were killed by Israeli marines in that incident.

For its part, Israel has voiced objections at NATO-member Turkey's hosting of members of Hamas, a Palestinian Islamist movement that is proscribed as a terrorist group in the West.

But the countries have moved to mend their relationship in recent months, with energy emerging as a key area for potential cooperation. They are expected to appoint new ambassadors soon.

It may be recalled that the Israeli charge d'affaires in Turkey had talked the re-appointment of an ambassador to Ankara, while repeating Israel's expectation that the Hamas office in Istanbul should be closed down.

In a roundtable meeting with journalists, Israel's current top representative in Ankara Irit Lillian said the process of re-appointing an ambassador to Turkey was only a matter of "when and not if."

"It's only because of elections in Israel that things might be delayed on the Israeli side but I hope it will be on time and it will be just a few more weeks and the process will be over," Lillian said, Israel will hold a general election on November 01, 2022.

Earlier, Turkey and Israel had agreed to re-appoint respective ambassadors more than four years after they were called back, marking another milestone after months of improved relations.

The two regional powers had expelled ambassadors in 2018 over the killing of 60 Palestinians by Israeli forces during protests on the Gaza border against the opening of the US Embassy in Jerusalem.

But they have been working to mend long-strained ties with energy emerging as a key area for potential cooperation.

Lillian reiterated the challenges to the ties, saying that the biggest obstacle to the "positive tendency seen throughout the year" was the existence of a Hamas office in Istanbul.

"There are plenty of challenges, but from our point of view, one of the main obstacles is the Hamas office in Istanbul," she said.

"Hamas is a terrorist organization, and it is no secret that Israel expects Turkey to close this office and send the activists there away from here," Lillian added.

A visit to Turkey by Israeli President Isaac Herzog in March, followed by visits by both foreign ministers, helped warm relations after more than a decade of tensions.

Turkish President Tayyip Erdogan and Israeli Prime Minister Yair Lapid held a phone call recently, expressing their satisfaction with the progress in ties and congratulated each other on the decision to appoint ambassadors.

Erdogan said necessary steps to appoint the ambassador would be taken as soon as possible, while Lapid said the strengthening ties would lead to achievements in commerce and tourism.

 

US exports over 100 million gallons of ethanol

The United States exported 101.48 million gallons of ethanol and 1.01 million metric tons of distillers’ grains in June, according to data released by the USDA Foreign Agricultural Service on August 04. Exports of both products were up as compared to June 2021.

Ethanol is an organic chemical compound. It is a simple alcohol with the chemical formula C₂H₆O. Its formula can be also written as CH ₃−CH ₂−OH or C ₂H ₅OH, and is often abbreviated as EtOH. Ethanol is a volatile, flammable, colorless liquid with a characteristic wine-like odor and pungent taste.

Ethanol is naturally produced by the fermentation of sugars by yeasts or via petrochemical processes such as ethylene hydration. It has medical applications as an antiseptic and disinfectant. It is used as a chemical solvent and in the synthesis of organic compounds, and as a fuel source. Ethanol also can be dehydrated to make ethylene, an important chemical feedstock.

The 101.48 million gallons of ethanol exported in June was down when compared to the 147.06 million gallons exported in May, which was a four-year high, but up from the 82.09 million gallons exported during the same month of last year.

The US exported ethanol to more than 30 countries in June. Canada was the top destination for US ethanol at 41.2 million gallons, followed by South Korea at 13.64 million gallons and the UK at 12.02 million gallons.

The value of US ethanol exports was at US$324.77 million in May, down from US$410.39 million a month ago, but up from US$187 million in June 2021.

Total US ethanol exports for the first half of 2022 reached 827.39 million gallons at a value of US$2.25 billion, compared to 662.62 million gallons exported during the same period of 2021 at a value of US$1.27 billion.

The 1.01 million metric tons of distillers’ grains exported in June was up from both 966,108 metric tons in May and 938,280 metric tons in June 2021.

The US exported distillers’ grains to approximately three dozen countries in June. Vietnam was the top destination at 197,192 metric tons, followed by Mexico at 158,501 metric tons and Turkey at 109,819 metric tons.

The value of US distillers’ grains exports was at US$311.08 million in June, down slightly from US$311.85 million the previous month but up from US$248.47 million in June of last year.

Total US distillers’ grains exports for the first six months of the year reached 5.67 million metric tons at a value of US$1.67 billion, compared to 5.4 million metric tons exported during the same period of last year at a value of US$1.42 billion.

Three grain ships scheduled to leave Ukraine ports on Friday

Three ships carrying a total of 58,041 tons of corn have been authorized to leave Ukrainian ports on Friday as part of a deal to unblock grain exports.

The first vessel carrying Ukrainian grain allowed to leave port since the start of the war set sail from Odesa on Monday bound for Lebanon, under a safe passage deal brokered by Turkey and the United Nations.

The Joint Coordination Centre in Istanbul, which groups Russian, Ukrainian, Turkish and UN personnel, said two ships would leave from Chornomorsk and one from Odesa on Friday.

"The three outbound vessels are estimated to depart in the morning from their respective ports," it said.

From Chornomorsk, the Polarnet would leave for Karasu in Turkey with 12,000 metric tons of corn and the Rojen would take 13,041 tons of corn to Teesport in Britain. From Odesa, the Navistar would take 33,000 tons of corn to Ringaskiddy in Ireland.

The Turkish bulk carrier Osprey S, flying the flag of Liberia, was expected to arrive in Ukraine's Chornomorsk port on Friday, the regional administration of Odesa said. It would be the first ship to arrive at a Ukrainian port during the war.

As of Thursday afternoon, Osprey S was anchored in the Sea of Marmara, around 1 kilometer (0.62 mile) off Istanbul's Asian coast, along with other ships waiting to cross the Bosphorus in to the Black Sea, according to a Reuters journalist.

According to Western media, Russian President Vladimir Putin sent troops into Ukraine on February 24, sparking the biggest conflict in Europe since World War Two and causing a global energy and food crisis. Ukraine and Russia produce about one third of global wheat and Russia is Europe's main energy supplier.