An Iranian official said Friday during talks in Azerbaijan both sides could work together on energy issues possibly extending into the European economy.

Iranian Minister of Communication and Information Technologies Mahmoud Vaezi met in Baku with Rovneq Abdullayev, director of the State Oil Company of Azerbaijan Republic. The Iranian minister said he was reviewing an offer from Baku to coordinate energy policies more closely for the sake of the needs of the European community.

"Azerbaijan and Iran has large oil and gas reserves, which indicates the need for increased cooperation between the countries in this area," he said.

Azerbaijan is scheduled to supply natural gas from its Shah Deniz field to European consumers through a network of pipelines that would run through Turkey to southern Europe. Dubbed the Southern Corridor, the network is meant to diversify a European energy sector influenced heavily by Russia.

Iran has held out its gas reserves for Europe, notably in the now-idled Nabucco gas pipeline.

European sanctions on Iran's energy sector, however, have gotten in the way of Tehran's energy ambitions.

Iran and Azerbaijan have close ties in the electricity industry.