Today, Swiss energy giant egl is set to sign a contract with Iran agreeing to purchase €18 billion worth of gas starting 2011. The potential deal comes in quick succession after the revelation in April that Austrian energy company omv signed letters of intent to buy €22 billion of gas from Tehran.

The Financial Timeswrote last Wednesday,

“The worry is that the Swiss deal will lead others, such as the Austrians, to confirm energy investments in Iran, and that companies like [France’s] Total could then follow suit and sign contracts of their own,” said one Western diplomat. He pointed out that the egl agreement ended a period in which European energy companies had largely confined themselves to agreeing only non-binding memoranda of understanding with Iran.He added: “There is a lot of attention on sanctions on Iranian banks, but investment in the energy sector is much more important for Iran’s economy.” Iran has the world’s second-largest proven gas reserves, but exports far below its potential.

While the European Union, led by its representatives on the UN Security Council, has agreed to stop economic dealings with Iran when it comes to the banking and the nuclear and missiles sectors, the crucial energy field is off limits for sanctions.

The Iranian oil sector alone accounts for about 85 percent of government revenue. Obviously, if sanctions were to be effectual on the Ahmadinejad government, this is the exact place the United Nations would need to hit. But such sanctions would never pass. Europe, like most of the West, is hungry for any form of energy it can get, and is proving by its actions that it has no problem undermining efforts to thwart Iran’s nuclear program in order to sustain its energy appetite.

The purpose of economic sanctions is to isolate Iran to the point where it suffers enough economic hardship to induce it to stop its nuclear program. Instead, the U.S.-orchestrated sanctions have exposed the fact that the United States is the one isolated in the world, not Iran. Nations today face two options with respect to Iran: Knowingly fund the world’s number-one state sponsor of terrorism in the face of drastic energy shortages for relatively short-term energy gain, or hold off investment in hopes that Iran will be pressured into stopping its nuclear program. Europe looks, for the time being, to be choosing the former.

A notable exception to this trend in Europe is Britain’s Prime Minister Gordon Brown, who said that he was looking to broaden sanctions against Iran’s nuclear program “to include investment in liquefied natural gas.”

These latest proposals by Austria and Switzerland, however, show that the Continent’s concern lies more with its own energy supplies than the wishes of the superpower across the Atlantic. It’s just another sign that U.S. hegemony and influence is all but gone in Europe. For further information, read “Which Is the Isolated State: Iran—or America?”