Report Investment Rating - No investment rating information is provided in the report. Core Viewpoints - Iran has abundant natural gas resources but is restricted by sanctions and domestic demand, limiting its export potential. Iraq faces a supply - demand imbalance and is accelerating the diversification of gas sources. The future of energy cooperation between the two countries depends on sanctions and geopolitical trends [3][4][5]. Summary by Directory Iran and Iraq Natural Gas Market Overview Geopolitical and National Positioning - Iran and Iraq are key energy countries in the heart of West Asia, connecting the Persian Gulf, the Caspian Sea, and Eurasia. Iran has a large natural gas and oil reserve, while Iraq's economy highly depends on oil exports [10]. Resource and Reserve Distribution - As of December 2023, Iran's proven natural gas reserves are about 1200 trillion cubic feet, ranking second globally. Iraq's reserves are about 131 trillion cubic feet, ranking among the top 12 globally. However, Iran's export potential is restricted by sanctions, and Iraq's production growth is slow due to insufficient investment [12][16]. Infrastructure and Cross - border Trade Network - **Cross - border Pipelines**: Iran supplies gas to Iraq through three cross - border pipelines, but the actual transportation volume is lower than the design capacity. The pipelines are restricted by geopolitics, sanctions, and infrastructure aging [22]. - **LNG Facilities**: Iran's LNG projects are stagnant due to sanctions and lack of funds. Iraq is promoting FSRU projects to diversify gas sources, but these projects are also restricted by financing, pipeline networks, and security [23][27]. Iran: Natural Gas Supply Pattern and Export Potential Assessment Resource Endowment and Production Pattern - Iran has the world's second - largest proven natural gas reserves, but its production growth has slowed down. The South Pars gas field is facing production decline, and new gas fields' development is lagging [31][34]. Domestic Demand Structure and Squeezing Pressure - Iran's domestic natural gas consumption has increased rapidly, mainly for urban gas, power generation, and industry. The energy crisis has intensified the contradiction between domestic demand and export [37][39]. Export Path and Commercialization Prospect - Iran mainly exports natural gas through pipelines to neighboring countries. In the future, it is expected to maintain a mixed mode of "pipeline - based and LNG - supplemented", but its export scale depends on domestic demand and sanctions [44][49]. Sanctions, Investment, and Technical Constraints - US sanctions have restricted Iran's access to international financing and technology, delaying many projects. Domestic budget constraints and policy contradictions also affect the development of the natural gas industry [54][57]. Iraq: Demand Pressure, Gas Shortage Situation, and Emergency Import Plan Resource Endowment, Production Bottlenecks, and Consumption Gap - Iraq has considerable natural gas resources, but its actual production is low due to low associated gas capture efficiency, aging facilities, and insufficient investment. The power system highly depends on natural gas, resulting in a large supply gap [58][65]. Iran Gas Source Dependence and Supply Contraction Challenge - Iraq has long relied on Iranian natural gas, but the supply has been unstable due to Iran's domestic demand, sanctions, and payment issues. Iraq is taking measures to deal with the instability [70][74]. External Dependence, Fiscal, and Geopolitical Risks - Iraq faces financial pressure and external dependence risks in diversifying gas sources. LNG imports are costly, and payment and contract risks may lead to supply interruptions [77][78]. Iran - Iraq Cross - border Natural Gas Cooperation and Bilateral Relations Analysis Agreement Execution Difference Analysis - There are significant differences between the actual execution and the agreement in gas supply volume, payment settlement, and supply stability in the cooperation between Iran and Iraq [79][81]. Geopolitical and Gas Supply Risks - US sanctions, regional security, and payment mechanisms pose risks to the cooperation between the two countries [82]. Bilateral Complementarity and Potential Contradiction Points - The two countries have complementary energy supply and demand, but there are also contradictions in debt, strategic development, and infrastructure investment [83]. Market Transformation and Global Competition Outlook Uncertainty Factor Analysis - The development of the natural gas markets in the two countries is affected by US sanctions, FSRU project progress, Iran's domestic supply - demand balance, international LNG market fluctuations, and debt negotiation progress [84][85]. Medium - and Long - term Outlook - In the next decade, the natural gas markets of the two countries will show a pattern of "complementarity and game coexisting". Iran needs to attract foreign investment and technology, while Iraq needs to ensure the FSRU project and improve domestic production capacity [86].