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Michael T. Klare: Putin’s Ruthless Gambit

September 2, 2008

Michael T. Klare

Many Western analysts have chosen to interpret the recent fighting in the Caucasus as the onset of a new Cold War, with a small pro-Western democracy bravely resisting a brutal reincarnation of Stalin’s jack-booted Soviet Union. Others have viewed it a throwback to the age-old ethnic politics of southeastern Europe, with assorted minorities using contemporary border disputes to settle ancient scores.

Neither of these explanations is accurate. To fully grasp the recent upheavals in the Caucasus, it is necessary to view the conflict as but a minor skirmish in a far more significant geopolitical struggle between Moscow and Washington over the energy riches of the Caspian Sea basin — with former Russian President (now Prime Minister) Vladimir Putin emerging as the reigning Grand Master of geostrategic chess and the Bush team turning out to be middling amateurs, at best.

The ultimate prize in this contest is control over the flow of oil and natural gas from the energy-rich Caspian basin to eager markets in Europe and Asia. According to the most recent tally by oil giant BP, the Caspian’s leading energy producers, all former “socialist republics” of the Soviet Union — notably Azerbaijan, Kazakhstan, Turkmenistan, and Uzbekistan — together possess approximately 48 billion barrels in proven oil reserves (roughly equivalent to those left in the U.S. and Canada) and 268 trillion cubic feet of natural gas (essentially equivalent to what Saudi Arabia possesses).

During the Soviet era, the oil and gas output of these nations was, of course, controlled by officials in Moscow and largely allocated to Russia and other Soviet republics. After the breakup of the USSR in 1991, however, Western oil companies began to participate in the hydrocarbon equivalent of a gold rush to exploit Caspian energy reservoirs, while plans were being made to channel the region’s oil and gas to markets across the world.

Rush to the Caspian

In the 1990s, the Caspian Sea basin was viewed as the world’s most promising new source of oil and gas, and so the major Western energy firms — Chevron, BP, Shell, and Exxon Mobil, among others — rushed into the region to take advantage of what seemed a golden opportunity. For these firms, persuading the governments of the newly independent Caspian states to sign deals proved to be no great hassle. They were eager to attract Western investment — and the bribes that often came with it — and to free themselves from Moscow’s economic domination.

But there turned out to be a major catch: It was neither obvious nor easy to figure out how to move all the new oil and gas to markets in the West. After all, the Caspian is landlocked, so tankers cannot get near it, while all existing pipelines passed through Russia and were hooked into Soviet-era supply systems. While many in Washington were eager to assist U.S. firms in their drive to gain access to Caspian energy, they did not want to see the resulting oil and gas flow through Russia — until recently, the country’s leading adversary — before reaching Western markets.

What, then, to do? Looking at the Caspian chessboard in the mid-1990s, President Bill Clinton conceived the striking notion of converting the newly independent, energy-poor Republic of Georgia into an “energy corridor” for the export of Caspian basin oil and gas to the West, thereby bypassing Russia altogether. An initial, “early-oil” pipeline was built to carry petroleum from newly-developed fields in Azerbaijan’s sector of the Caspian Sea to Supsa on Georgia’s Black Sea coast, where it was loaded onto tankers for delivery to international markets. This would be followed by a far more audacious scheme: the construction of the 1,000-mile BTC pipeline from Baku in Azerbaijan to Tbilisi in Georgia and then on to Ceyhan on Turkey’s Mediterranean coast. Again, the idea was to exclude Russia — which had, in the intervening years, been transformed into a struggling, increasingly impoverished former superpower — from the Caspian Sea energy rush.

Clinton presided over every stage of the BTC line’s initial development, from its early conception to the formal arrangements imposed by Washington on the three nations involved in its corporate structuring. (Final work on the pipeline was not completed until 2006, two years into George W. Bush’s second term.) For Clinton and his advisors, this was geopolitics, pure and simple — a calculated effort to enhance Western energy security while diminishing Moscow’s control over the global flow of oil and gas. The administration’s efforts to promote the construction of new pipelines through Azerbaijan and Georgia were intended “to break Russia’s monopoly of control over the transportation of oil from the region,” Sheila Heslin of the National Security Council bluntly told a Senate investigating committee in 1997.

Clinton understood that this strategy entailed significant risks, particularly because Washington’s favored “energy corridor” passed through or near several major conflict zones — including the Russian-backed breakaway enclaves of Abkhazia and South Ossetia. With this in mind, Clinton made a secondary decision — to convert the new Georgian army into a military proxy of the United States, equipped and trained by the Department of Defense. From 1998 to 2000 alone, Georgia was awarded $302 million in U.S. military and economic aid — more than any other Caspian country — and top U.S. military officials started making regular trips to its capital, Tbilisi, to demonstrate support for then-president Eduard Shevardnadze.

In those years, Clinton was the top chess player in the Caspian region, while his Russian presidential counterpart, Boris Yeltsin, was far too preoccupied with domestic troubles and a bitter, costly, ongoing guerrilla war in Chechnya to match his moves…

READ MORE AT TOMDISPATCH.COM

Michael T. Klare is professor of peace and world security studies at Hampshire College and the author, most recently, of Rising Powers, Shrinking Planet: The New Geopolitics of Energy (Metropolitan Books).

Copyright 2008 Michael T. Klare

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