Iran’s policy in the South Caucasus is based on pragmatic approach and above all takes into consideration interests of Russia.Iran sees Russia as a counterweight of the West in the region and this factor prevails over the others. For Tehran Moscow represents a tool for escaping the sanctions imposed by the US. Russia, which in under sanctions itself, perfectly understands that Iran liberated from sanctions, could become a fierce rival with gigantic reserves of oil and gas if Tehran gets the possibility to access the Black Sea cost with the most convenient and for it the safest route – Iran-Armenia-Georgia, and in this way connect India and the Persian Gulf with the Black Sea.Iran’s interests regarding the Caspian Sea are obviously incompatible with the other littoral countries, among them Russia’s interests. Positions of two countries concerning the partition of the Caspian Sea are different. Russia secured an agreement with other littoral countries about the sectoral partition of the Sea. Since Iran still supports the equal partition of the Sea floor, despite that President Rouhani signed the agreement concluded on the Caspian Sea Summit, Iranian parliament has not ratified the agreement yet. Caspian oil and gas transportation issue is a perfect example of the crash of the ‘two great axes’: Baku-Tbilisi-Ceyhan (BTC) oil pipeline and the Baku-Tbilisi-Erzurum (BTE) gas pipeline are controlled by the West; therefore, in this case, Russia and Iran remains left out, hence their interests are damaged. The efforts of the West to diminish the dependence on Russia’s natural gas correspond to Iranian interests. it would be logical if Iran took full advantage from the situation created after the Russian aggression against Ukraine but Tehran took steps in the opposite direction and by the further rapprochement with Russia made such a prospect even more unrealistic. One of the major economic projects of Iran and Russia is North-South Corridor project. Its length should be 7,200 km (sea, railway, roads). Iran aims at using its geographic location and becoming a hub for energy supply lines and transit routes for Europe, Russia and the Middle East on the one hand and Central Asia, China and the Indian subcontinent on the other. Thus, together with Russia and India Iran is promoting a project to build an international north-south railway corridor. But there are also many factors that can negate the economic benefits of the project for Iran. After the outbreak of the war by Russia against Ukraine in February 2022, this project also became unrealistic – European countries won’t use the Russian territories as a transit route for trade with the East. Iran holds careful position careful position concerning the conflicts in South Caucasus. In this case also Iran cannot contradict Russia, whose dominant position in the region is recognized by Iran. However, the Russo-Iranian relations are fragile. While Russians consider themselves as the last bulwark against Islamic fundamentalism, the Iranians see Russia as a ‘newcomer’ in the region. Attitude full of suspicions is also determined by historical factors. Russian interference in country’s affairs in 19th and 20th centuries is deeply rooted in the memory of Iranians. Russia aims to be the main player in its southern neighborhood. Therefore, Moscow is opposed to the significant presence of any other regional power with ethnic and cultural affinity with the indigenous peoples of this region. In this aspect, the South Caucasus stands indeed close to Iran. So, the Iranian-Russian relations were primarily like a marriage of convenience and a matter of mutual commercial benefit. Each seemed suspicious of the other and was willing to take opposing positions when it suited its immediate interests. Since the invasion of the Russian troops in Ukraine and the outbreak of war in February 2022, it is difficult to speak about the future of Russian-Iranian relation, but it is certain the new reality created in the world after the Russian aggression, will affect also Iranian-Russian interactions. Today Russia and Iran are more close partners than before the war but it is difficult to speak about their interactions in mid or long-term perspective.