Iran feels the need to diversify its gas supply sources from neighboring countries following the intensification of gas imbalance. This imbalance has led Iran to face limitations in supplying the necessary gas during certain periods and has prevented it from fully and sustainably fulfilling all its export commitments to Turkey and Iraq.
Pressure on Trade Relations and Contractual Credibility
The current situation has not only created pressure on trade relations but has also impacted the country's contractual credibility. The concentration of about 50 percent of the country's total energy on the South Pars gas field is considered one of the most significant structural vulnerabilities in Iran's energy security. Any disruption in production from this field can have extensive effects on the country's gas supply.
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Necessity of Gas Trade Development
As a result, the daily gas imbalance during the cold days of the year has led to limitations in supplying feedstock for industries, power plants, and the residential sector, creating significant economic costs. In such circumstances, the development of trade and diversification of gas supply sources from neighboring countries has transformed from a business choice into a necessity for strengthening the country's energy security and economic sustainability.
With over 17 percent of the world's proven gas reserves (over 32 trillion cubic meters), Iran ranks second globally after Russia and holds the position of the third-largest producer in the world with an annual production of over 250 billion cubic meters. Recognizing this capacity, the legislator has set a clear target in the seventh development plan to achieve an export volume of 40 billion cubic meters and an import volume of 20 billion cubic meters of gas per year.
In the northeastern borders of the country, Turkmenistan, as the fifth-largest holder of gas reserves in the world, is in dire need of diversifying its export markets and breaking free from the monopoly of its main gas buyer, China. In terms of infrastructure, the "Dolatabad-Sarakhs-Khangiran" pipeline currently has a nominal capacity to transport 12.5 billion cubic meters of gas annually.
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