Saturday 29 October 2016

Nuclear deal, oil and gas: geopolitics game at play

Friends again, Merkel and Hollande to work more closely on 'security issues' and, with Italy, to collaborate on the development of a European drone

Published 05/04/2015 | 02:30

FRIENDS: German Chancellor Angela Merkel and French President Francois Hollande after a press conference at the Chancellery last week, in Berlin. Photo: Getty
FRIENDS: German Chancellor Angela Merkel and French President Francois Hollande after a press conference at the Chancellery last week, in Berlin. Photo: Getty

Iranians celebrated in the streets after negotiators reached a framework for a nuclear accord, and US President Barack Obama hailed an "historic understanding", but senior global diplomats cautioned that hard work lies ahead to strike a final deal.

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The tentative agreement, struck last Thursday after eight days of talks in Switzerland, clears the way for a settlement to allay Western fears that Iran could build an atomic bomb, with economic sanctions on Tehran being lifted in return.

It marks the most significant step toward rapprochement between Washington and Tehran since the 1979 Iranian revolution, and could bring an end to decades of Iran's international isolation.

But the deal still requires experts to work out difficult details before a self-imposed June deadline and diplomats said it could collapse at any time before then.

The framework accord could eventually allow Tehran to reclaim lost ground in the global oil market. Yet the deal all but guarantees that cannot happen before next year.

Verifying compliance by Iran, once the world's fifth-largest oil producer, will "likely take many months after implementation, which itself is likely to slip from the June 30 target," said Bob McNally, president of energy research group Rapidan Group and a former adviser to President George W Bush.

Jason Bordoff, founding director at Columbia University's Center on Global Energy Policy and former adviser to President Barack Obama, agreed: "It is going to take time for Iranian oil to come back to the global market, likely not until 2016 at the earliest."

Russian President Vladimir Putin and Greek Prime Minister Alexis Tsipras plan to discuss economic ties and the European Union's sanctions against Moscow when they meet for talks next week, a Kremlin spokesman said on Friday.

Russia wants the EU to lift the sanctions imposed over Moscow's role in the turmoil in Ukraine and hopes to get support from some EU member states, notably Hungary and Greece.

Kremlin spokesman Dmitry Peskov said on Tuesday, meanwhile, that Russia was not seeking to buy political influence in the EU member state Hungary through a nuclear deal, defending Moscow's cooperation with Budapest as mutually beneficial.

Peskov was commenting on a Reuters investigation into Moscow's €10bn loan to Budapest to finance the expansion of Hungary's Paks nuclear power plant.

A Greek parliamentary committee set up by Prime Minister Alexis Tsipras's government to demand reparations for the Nazi occupation of Greece began work last Wednesday, in a move likely to heighten tensions between Athens and Berlin.

Greece's emotive campaign for war damages has been waged for decades by governments and private citizens alike. But it has gained momentum in recent years as Greeks suffered under the German-backed austerity imposed by the EU and the IMF in exchange for financial bailouts.

Greece's government denied on Wednesday it would delay a payment to the IMF due on April 9, after the interior minister was quoted as saying Athens would take the step if it did not get fresh aid from lenders.

Last Tuesday, the leaders of Germany and France announced plans to work more closely on economic and security issues after years of strain, saying the tragedies of the Charlie Hebdo killings and air crash in the French Alps had brought them closer.

Chancellor Angela Merkel and President Francois Hollande, whose relationship has sometimes been tense since the French Socialist took power in 2012, met in Berlin on Tuesday, a week after a German pilot with a history of depression steered an airliner into a mountain in southern France, killing 150 people.

The disaster came two months after Islamist gunmen killed 17 people in Paris at the satirical weekly Charlie Hebdo and a Jewish shop.

"Looking back, Germany and France were tested in the first three months of 2015 and we moved closer to each other," Merkel told a joint news conference.

"I remember the horrible events around Charlie Hebdo, but also the decisive response in favour of free speech, democracy and the fight against terrorism. Together we sent a signal about how we will deal with the challenges of our time."

Hollande said the Franco-German friendship had "evolved" over the past days and weeks into one of "brotherly closeness".

Meanwhile, it was reported last week that Germany wants to invest €210m in France's new military Earth observation satellite program in return for more access to images captured by the satellites.

The German parliament's budget committee still needs to approve the plan.

In addition, Germany and France want to sign a technical agreement to collaborate on the development of a European drone, jointly with Italy, it showed.

The European Commission last week also announced its intention to broker more talks between Russia and Ukraine this month to try to extend a discount on gas prices for Kiev.

Sunday Independent

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