How Turkey Beats Iran on Energy
Iran may be an oil and gas giant, but it has failed to play much of an official role in Iraq’s energy industry because its companies are technically and financially weak. Turkey, on the other hand, is emerging as a tough, strategic competitor.
In the contest between Turkey and Iran for influence in Iraq, energy is one of the crucial factors. It might seem that an oil and gas giant such as Iran would have a clear advantage over importer Turkey, but Ankara has played to its strengths while Iran has, as so often before, failed to use energy strategically.
Both countries seek to use energy as part of wielding wider influence within Iraq. Both also seek profitable business opportunities. But then, their strategies diverge.
Turkish-Iraqi trade ran at about $12 billion last year, and Iranian-Iraqi at $7 billion. Turkish companies were involved in construction and engineering; Iran was more notable for consumer goods and agricultural products. Not surprisingly given geographic and sectarian affiliations, Turkey is prominent in the north and Baghdad, and Iran is in the south. Both supply electricity to Iraq, which has only six to eight hours' supply across most of the country.
Despite Iran’s oil history stretching back to 1908, its 30 years of state management of the business and its policy of self-sufficiency, it has failed to play much of an official role in Iraq’s energy industry. Its energy companies are technically and financially weak.
