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Russia mulls stronger ties to Iran’s energy sector

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Trade relations between Russia and Iran, seen by the Kremlin as a strategic partner, may be bolstered in the energy sphere, the Russian president said.

Leaders from Azerbaijan, Iran and Russia hold a trilateral meeting next week in Baku, the Azeri capital. Speaking with Azerbaijan news agency AzerTag, the Russian president said the relationship with Iran in particular was strengthening now that tensions were easing in the wake of a multilateral agreement reached last year.

“We intend to continue fostering trade and economic cooperation,” President Vladimir Putin said.

Iranian Oil Minister Bijan Zanganeh in 2014, before the nuclear agreement was signed, hinted that an oil-for-goods arrangement with the Russian government was possible. Later that year, the Kremlin said it planned to sign contracts to deliver grain and possibly industrial products to the Iranians in exchange for oil.

Both sides already cooperate in a variety of fields, with Russia supplying fuel for Iran’s nuclear reactor at Bushehr. Both sides are also the target of Western economic sanctions. Sanctions pressures on Iran, however, started easing in January after the United Nations confirmed compliance with the multilateral nuclear agreement.

Putin said bilateral trade between both countries so far this year is up 70 percent from 2015 to $855 million. The partnership is already strategic, he said, particularly in the realm of nuclear energy.

“Large-scale joint projects in the oil and gas sphere, and the aerospace and electric power industries are being developed,” he added.

The Kremlin is already on record with pledges to grant $2.4 billion to help finance a thermal power plant and rail networks in Iran.