"Trust, but verify" is a well-known phrase from the Reagan era, often used by the White House back then when discussing negotiations with the Soviet Union.
But President Reagan knew he was actually adapting a much older Russian proverb – Доверяй, но проверяй ("Doveryai, no proveryai").
Such are the often strange twists in international diplomacy.
I mention this because a critical energy conference I attended last week reminded me that we may well be revisiting that territory. Territory that is, for me, familiar because of the international geopolitical arc of my career.
This time around, however, the United States isn't exactly dealing from a position of strength. These talks were made so much harder by America's self-inflicted wounds.
Investors run a real risk of missing out here…
What I Saw as the Only American in the Room
There were two parallel sessions at last week's Iranian LNG & Gas Summit in Germany's financial center, Frankfurt.
On one level there was the official program of the first international summit devoted to Iranian natural gas and LNG (liquefied natural gas, the key to exporting gas beyond the reach of pipelines).
On another level there was a series of meetings held on the margins of the summit. The discussion here was much more frank and forthcoming, in some cases resulting in quite pointed and direct conversations.
That I was the only American here occasionally put me at the center of matters. And that's not the only reason why the summit was grueling.
It now looks like the U.S. energy industry, and more importantly, American shareholders, are going to be left behind as the rest of the world rushes to cash in on a major new market…
Iranian-American Tensions Couldn't Come at a Worse Time
I gave some formal presentations before and throughout the summit. But it was the sidebar conversations that took up most of my available time, such that by the time it was over, I was beginning to feel exhaustion creep in.
With the world's largest conventional gas reserves, Iran has always been regarded as a likely main player in the developing global gas market. However, as with crude oil, the imposition of Western sanctions has impeded any progress for years.
That was supposed to change after 2015's so-called "nuclear deal" between Iran and the P5+1 (the five permanent members of the UN Security Council – the U.S., China, Russia, France, and the UK – along with Germany).
Officially referred to as the Joint Comprehensive Plan of Action (JCPoA), the accord specifies Iranian compliance with an international demand that it pull back from developing nuclear weapons. In return, the international sanctions were to be phased out.
Tehran had always denied it had an interest in developing nuclear arms. Yet the United States repeatedly pointed to actions inside Iran that could not be explained in any other way.
An impasse ensued that both made life inside Iran worse and created protracted geopolitical friction.
These days there is still rhetoric coming from Washington alleging nefarious Iranian intent, compounded by an executive order (EO) prohibiting visas for Iranian citizens (and those of six other Muslim countries) trying to enter the United States, and, of course, the inevitable retaliatory moves against visas for U.S. citizens by both Iran and Iraq (another country on the "list of seven").
It's that particular development that has called into question my intended appearance in May at the Iranian Oil Summit in Iran's capital, Tehran.
The U.S. Ninth Circuit Court ruling may have prompted a suspension in the enforcement of the order, but the visa issue from Iran remains in limbo.
About the Author
Dr. Kent Moors is an internationally recognized expert in oil and natural gas policy, risk assessment, and emerging market economic development. He serves as an advisor to many U.S. governors and foreign governments. Kent details his latest global travels in his free Oil & Energy Investor e-letter. He makes specific investment recommendations in his newsletter, the Energy Advantage. For more active investors, he issues shorter-term trades in his Energy Inner Circle.