IRAN’S LIMITATIONS IN ENERGY TRANSIT IN THE LIGHT OF ENERGY CHARTER TREATY

Abstract

Energy charter treaty, ECT in short, is a sort of multilateral pact that was endorsed on 17th of December, 1994 in Lisbon. The most important. The most important part of the charter is related to transit the regulations of which have been embedded in 17 articles. The studies show that less attention has been paid in Iran to the issues beyond the transit and the treaty, as well, is essentially silent regarding the effect of extra-treaty factors. Security Council and EU’s multilateral and the US’s unilateral embargoes are amongst the factors that have been influential in the investors’ exit from Iran and reduction in Iran’s oil sales. The present study has been conducted to inter alia evaluate the extent to which ECT can provide sales’ security for Iran; it will be also seen if this treaty can lift restrictions on Iran’s sales of oil or not. The results of the investigation indicated that Iran’s embargoes, especially oil sanctions, are contradictory to the explicit text of the transit regulations that have been inserted in article 17 thereof. In general, the international trade needs should be satisfied based on the aforementioned act through setting the grounds for access to the market resources disregarding the source, destination and energy ownership so Iran’s embargo-based restrictions are in conflict therewith. Moreover, the states and the private sector investors follow US’s economic power more than staying bound to the treaties in their relations with Iran.