Sanctions on Iran May Foster Alternative Trade Routes

Tehran, Iran
Tehran, Iran

By Harry Valentine 05-20-2018 11:21:24

While American President Donald Trump has canceled the Iran nuclear agreement and imposed economic sanctions on that nation, several European and Asian nations have announced that they will disregard the sanctions. Several ship transport companies that also sail to American ports, have chosen to suspend transportation services to and from Iranian ports. However, other modes of transportation will likely flourish despite the sanctions. 


While American trade sanctions increases the likelihood of navy vessels intercepting container ships and tanker ships suspected of serving Iran, inside the Persian Gulf, other alternative methods of transporting some forms of bulk freight and container freight are either available or in the process of being developed. China’s plan to build a trade-based Silk Road across Asia includes pipelines to carry oil and natural gas from Iran. Government officials from outside the region may not be able to monitor the volume of oil and natural gas that will flow via Silk Road pipelines.

Discussions began several decades ago about connecting an international gauge railway line between Istanbul and Asia. At the present day, such a railway line connects between Tehran and Beijing and container trains have traveled that line. There is need to build a stretch of railway line around Lake Van in Turkey to avoid vessels having to carry short sections of train across that Lake. A direct railway connection between Istanbul and Tehran would greatly improve priority railway container transportation between China and Europe. Railway construction in Turkey is independent of American sanctions.

Alternative Maritime Route

The alternative maritime route crosses the Caspian Sea into a series of navigation locks to the town of Volgograd and another series of navigation locks to the Sea of Azov into the Black Sea, Danube River and Mediterranean Sea. The Danube River connects to several European economies and has historically carried much trade, and at the present day, tugs push and navigate trains of coupled barges along several sections of that river. Several navigable Russian rivers flow into the Black Sea and provide cost competitive maritime passage between several Russian and European cities.

The combination of American trade sanctions on Iran and European nations seeking to disregard those sanctions places higher emphasis on improving navigation between the Caspian Sea and the Black Sea. A lowland area lies between the Caspian Sea and Sea of Azov, where a future direct navigation canal may be possible and built in the same manner as the Suez Canal. Such a navigation canal would also benefit the economies of Turkmenistan, Kazakhstan and even Azerbaydzhan and Uzbekistan. It is unlikely that any navy would intercept trading vessels sailing across the Black Sea.

Trading Energy

Not only does Iran export oil and natural gas, electric transmission lines connect across Iran’s borders into Turkey and also into Turkmenistan. The central location of Iran allows that nation to export peak hour electric power into both Eastern Asia as well into Western Europe. When East Asia’s evening peak demand for electric power ends, Europe’s demand for morning peak electric power begins, allowing Iranian nuclear power stations to continually operate at peak output and export electricity. A dam built across the Strait of Hormuz could operate both pumped hydraulic energy storage and tidal power generation.

An oil pipeline from China could extend across Northern Iran into Northern Iraq and into the oil regions located near Mosul and Kirkuk, providing an amicable political agreement were to become possible. Waste energy from Iranian thermal power stations located on the Caspian Sea could sustain the operation of updraft waterspouts that push massive volumes of water skyward. January winds would push the additional humidity westward toward the mountains that are the watershed regions of the Tigris and Euphrates Rivers. Several regions across Turkey, Syria and Iraq would benefit from additional water flowing in these rivers.

Risings Seas

Proponents of global warming have suggested that warming oceans and melting Arctic ice would raise international sea levels. Around the Gulf, Emirate nations such as Sharjah, Dubai, Abu Dhabi, Qatar, Bahrain, Kuwait and east coast Saudi Arabian province of Dammam could experience future coastal flooding. A future dam built across the Strait of Hormuz would maintain a difference in water elevation between The Gulf and the Arabian Sea. The channel north of Qeshm Island on the north side of the strait offers future potential to construct navigation locks and a navigation channel for supersize ships. 


While American economic against Iran would reduce commercial ship transport to and from Iranian ports located inside the Gulf, ongoing European and Asian economic support for Iran offers the potential to improve existing alternative international trade links and develop new links. Railway trains carrying containers will continue to travel between Europe and China, including through Iran. Construction of pipelines to carry oil and natural gas from Iran into Asia will continue while improved maritime connections between the Caspian Sea and Black Sea is possible.

The opinions expressed herein are the author's and not necessarily those of The Maritime Executive.