Russia, Iran could set up 'logistics hub' to exchange oil, gas after embargoes

Russia and Iran have discussed swapping supplies for oil and gas as well as setting up a logistics hub, Russian Deputy Prime Minister Alexander Novak said on Wednesday, as Moscow is challenging Western sanctions over its military operation in Ukraine.

Russia has been tackling Western sanctions, which curbed its oil exports and production by restricting trade and financing. The United States banned imports of Russian oil shortly after Moscow sent troops to Ukraine, while the European Union is considering a phased embargo, pushing more Russian oil cargoes towards Asia.

Iran's oil industry has struggled for years under US sanctions imposed over Tehran's nuclear work.

"Of course, Iran has lived (under sanctions) for years, and we have discussed the Iranian experience," Novak told Russian state TV during his visit to Iran.

"Iran could become a key transportation and logistic hub for ensuring mutual transportation of goods," Novak said, adding that the annual goods turnover between Russia and Iran has potential to rise to 50 million tonnes in a few years from 15 million tonnes now.

He said Russia may supply its energy to northern Iran, while at the same time Iranian oil and gas could be exported to Asia Pacific regions from the south. Novak said the agreements could be sealed in the near future.

The two countries also discussed investment in some oil and gas projects, Novak said.

(Reuters)