Iran Cashes In On Russia Running Low On Munition
Documents seen by the UK’s Sky News suggest that Iran is profiteering from Russia’s war in Ukraine.
Documents seen by the UK’s Sky News suggest that Iran is profiteering from Russia’s war in Ukraine.
Overpriced ammunition shows the cash-strapped regime is able to charge over the going price as fellow sanctions-hit Russia runs low on supplies.
The 16 pages of top-secret documents, dated September 14, 2022, appears to be for samples of varying sizes of artillery and tank shells and rockets worth just over $1m.
A table on page five of the supplementary section covers samples of ammunition and weapons worth $741,860, including two 125mm barrels for the 2A46M gun of a T72 tank - each barrel priced at $85,750 - and two 122mm barrels for a D-30 Howitzer artillery piece - at a cost per barrel of $54,750.
The supplement also lists parts of ammunition to be sent, including 12 pieces respectively of the "shell body" and "brass case" of 122mm and 152mm ammunition.
The total for just 1,000 rounds adds up to $1,013,100, above market value. Colonel Hamish de Bretton-Gordon, a former army officer, told Sky News he thought this was expensive for such a relatively small quantity. "Let's hope the Iranians are ripping [Vladimir] Putin off,” he said.
Speaking to Sky News, Ukraine’s ambassador in the UK, Vadym Prystaiko, said: "That they're actually talking about simple stuff like the armaments, like ammunition, this is showing that the Russian position is quite difficult indeed."
If true, it is further evidence of Iran’s supporting the war in Ukraine. Several global powers including the US and UK have issued sanctions on Iran for supplying Russia with drones on its war in Ukraine which have attacked civilians and civilian infrastructure.
Earlier this year, Sky News also reported allegations that Iran supplied large quantities of bullets and ammunition to Russia via cargo ships on the Caspian Sea in January. The transaction also dated back to September 2022.
Speaking to Sky News, Jack Watling, a senior research fellow at the Royal United Services Institute, who has spent a lot of time in Ukraine covering the war and is also an expert on Iran, said it would make "perfect sense" for Moscow and Tehran to agree contracts for arms sales. "There was nothing in there that struck me as making it incredible," Mr Watling said, referring to the documents.
"It seemed perfectly reasonable. The timing matched up with when we started to see certain transfers being made. And there were a lot of specific details, like, for example, the use of Swiss jurisdiction for arbitration in the case of a dispute between the parties that also looked quite credible in terms of previous Iranian practice."
Headlined "In the name of Allah", the contract "for the delivery of ammunition" is allegedly between the Ministry of Defence and Logistics of the Armed Forces of Iran and Russia's state military exporting and importing company, JSC Rosoboronexport. The agreement is identified by this number: NoIR-RU-2022 6001/1/NoP/2236478020960.
The document, drawn up in English, is split into sections - each with a numbered article - like any normal contract. Key details are listed like payment for the samples of ammunition - $1,013,100 (£813,000).
An internationally recognised set of regulations and terms that underpin trade deals, known as the INCOTERMS, or International Commercial Terms, are cited - making the covert sale of arms seem almost mundane.
One paragraph reads: "5.9 Right of ownership and risk of loss or damage of the subject of the contract shall be transferred from the supplier to the customer under terms and conditions of FOB/INCOTERMS 2010.”
This section on the transportation of the goods, also reveals the plan was to fly the ammunition samples to Russia from Iran. They must be delivered within 10 working days after payment.
Article eight sets out how the contract is governed by a private codification of international contract law known as the UNIDROIT Principles. These principles are approved by an inter-governmental organisation called the International Institute for the Unification of Private Law (UNIDROIT), which has more than 60 member states, including Iran and Russia but also the UK, the US and other Western allies.
The contract says any dispute that cannot be settled amicably would be dealt with by Swiss arbitration in Zurich, in spite of the fact that Switzerland has imposed sanctions on Iran for the provision of its deadly drones to Russia, wreaking havoc on Ukrainian cities.
Sky News has not been able to verify the authenticity of the documents independently and there has been no official government response from Iran or Russia.
The vessel sent a distress call on June 4 while transiting the straits, a relatively narrow waterway controlled in the north by Iran but considered international waters for commercial and naval traffic.
Iran has hundreds of fast attack boats that for years not only have harassed civilian vessels but, on many occasions, have come dangerously close to US and other warships in a show of force.
“The internationally flagged merchant vessel made a radio distress call at 4:56 p.m. local time while transiting the narrow strait. The civilian crew reported three fast-attack craft with armed personnel approached and followed the merchant vessel at close distance. The fast-attack craft were assessed to be from the Iranian Islamic Revolutionary Guard Corps Navy,” a US navy statement said.
US Navy guided-missile destroyer USS McFaul and UK Royal Navy frigate HMS Lancaster both received the distress call, and Lancaster launched a helicopter to provide surveillance. US 5th Fleet also directed a P-8A Poseidon maritime patrol aircraft to monitor the scene, the Navy said.
“The situation deescalated approximately an hour later when the merchant vessel confirmed the fast-attack craft departed the scene. The merchant ship continued transiting the Strait of Hormuz without further incident.”
It must be noted, however, that allied navies did not confront the Iranian forces, but simply "monitored" the situation. If fighter jets or attack helicopters had been dispatched, it would have sent a more forceful signal to the IRGC.
The incident followed Iran’s seizure of two commercial vessels in the Persian Gulf waters in May and an announcement by the US to send more naval forces to the region.
“[The] United States will not allow foreign or regional powers to jeopardize freedom of navigation through the Middle East waterways, including the Strait of Hormuz,” National Security Council Coordinator for Strategic Communications John Kirby told reporters on May 12, adding that there is “simply no justification” for Iranian actions to interfere, harass or attack merchant ships.
The Sunday incident also followed an announcement by the United Arab Emirates last week that it has pulled out of a US-led maritime coalition to provide security, which was later denied by the United States. However, Iran was quick to claim victory and announce that a new naval coalition is being formed with regional powers. The US also denied that claim, saying the Iranian statement “defies reason” as the Islamic Republic itself is the greatest threat to maritime security.
Sunday’s action, although not a direct naval confrontation, will reassure littoral countries that have relied on the West, and primarily on the United States, for security in the Persian Gulf.
The region contains some of the world's most important shipping routes where, in 2019, suspected Iranian attacks began against oil tankers amid tensions with the United States as the Trump administration imposed oil export sanctions on Tehran.
But Iran had long been harassing even US Navy vessels with its fast attack boat. The Obama, Trump and Biden administrations chose not to retaliate against Iranian naval provocations over the years or show a convincing military deterrent response.
As Saudi Arabia, the largest Arab power in the region shows signs of adopting a new policy of détente with Iran and close ties with China, the Biden administration feels it has to show that US security guarantees are important for the oil-rich Arab allies.
“US 5th Fleet remains vigilant and is bolstering defense around the key strait with partners to enhance regional maritime security and stability,” the US Navy said in its statement about the Sunday incident.
Mohammad Mohajeri, a conservative politician and a critic of the current all-conservative political establishment in Iran, wrote in a letter to parliamentary speaker Mohammad Bagher Ghalibaf: “Your criticism of the government stinks. It smells like an election campaign.”
Mohajeri was referring to Ghalibaf’s statement on Tuesday night in the Northern Khorasan Province in which he criticised President Ebrahim Raisi administration, saying, “The way the country is being run and managed is wrong.” Ghalibaf further accused the Raisi administration of wasting $104 billion a year because of mismanagement. However, he did not explain where he got the figure from.
Some observers commented that $104 is an exaggerated number, given that its twice the country’s annual budget and four times its annual oil export income.
But Ghalibaf probably tried to jump on the bandwagon of criticism, as different factions and political institutions blame each other for the current economic mess.
The parliament speaker also faces uncertainty eight months before a new election.
Mohajeri further pointed out that had a media commentator said what you stated, he would have been sent to the court for “disturbing the public opinion and levelling accusations against the government.” He would even have been accused of speaking for the enemy, Mohajeri added.
Mohajeri added: “For citizens who cannot afford buying fruits for their visiting grandchildren, $104 billion is a huge figure. They will divide it into 85 million (Iranian population) and will find out that the country’s managers have inflicted a loss of 1,223 dollars per Iranian. With that money an ordinary Iranian would have managed to buy fruits and many other things.”
“You probably know who the officials are who have wasted all that money. Why don’t you name a few of them? Are they at the parliament or in the government? And what about you? If you are one of them, why are you still in power? Do you want to waste another $104 billion next year?” Asked Mohajeri.
Mohajeri added that “the members of the government keep saying on the state TV that they are the cleanest state officials in the world. If what you said is not part of your election campaign, are you brave enough to name at least one government official” who has wasted money?
Ghalibaf had said in his speech Tuesday night: “We waste $104 billion and then we beg a foreign company to come to Iran and invest only $4 billion in our oil industry. How can we explain this to coming generations?”
Meanwhile, in a statement issued to mark the anniversary of the Islamic Republic’s Parliament (Majles) the reformist National Trust Party said: “We should pay attention to the fact that Iranians have turned their backs to the polls in the last two elections (Majles election in 2020 and presidential election in 2021). We should not remain indifferent to that”.
The statement added: “The government needs to acknowledge its mistakes and make up for what it has done wrong and try to rebuild the people’s trust in the government as the chance to reform the system will not last forever.”
The National Trust Party was referring to the barring of reformists and moderates to run for those elections by the intervention of the Guardian Council, the Supreme Leaders office and the revolutionary guards (IRGC).
Critics have said that the restrictive policy has made Iranians reluctant to take part in elections and has eroded the people’s trust in the government and parliament.