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Russia-Georgia Conflict and Oil (Yep, Oil Again!)

posted August 11, 2008 - 11:36pm
Russia-Georgia Conflict and Oil (Yep, Oil Again!)

Among the root causes that are not being examined in the current spat between Russia and Georgia, is oil. Unfortunately, the mainstream media and Russophobes are crying "foul" without any understanding of why the Russians are willing to weather international outrage to handle their own business.

Why would the Russians invade Georgia if for no other reason than they are "dirty commies" and *insert stock Cold War canards here*? Let's take a look at the Baku-Tbilisi-Cyehan BTC oil pipeline that takes oil from the Caspian Sea through Azerbaijan through Georgia through Turkey and finally to the Turkish Mediterranean seaport of Ceyhan.

The consortium that owns the pipeline consists primarily of British BP (30.1%), State Oil Company of Azerbaijan (SOCAR) (25%), American companies (13.76%), with the remainder made up of European and Japanese companies. Noticeably absent is Russia.

There are other pipelines running from the Caspian Sea, which is under de facto Russian control, including the Baku-Suspa pipeline and the Buka-Novorossiysk. The latter two terminate in the Black Sea.

From the beginning, the BTC pipeline was controversial in that it bypassed Russia altogether and allowed Azerbaijan and Georgia some degree of economic autonomy. Russia held and continues to hold that the West would use the pipeline to establish a foothold in the oil-rich Caucus region of the former Soviet Republics and find a pretext for stationing troops there.

There are two things to consider. One, Georgia sent the third-largest contingent of troops to Iraq (after the United States and UK), which, although they are currently being recalled back to Georgia, represents a partnership with the West that Russia cannot ignore. Two, and perhaps the more egregious of the two, Georgia has been courted for possible membership in NATO (although Georgia could not be any further from the North Atlantic than Iraq and Iran).

This war has greater underlying meaning than Russians coming to the aid of South Ossetia, which has already been granted independence since 1992. One could argue that the Russians are making a statement on European and Western energy policy.



Comments

Eggs, that mantra is contravened by the Dept of Energy

Eggs, the mantra of "drill here, drill now, and pay less" is contravened by the Department of Energy, who issued a statement that lifting the Congressional moratorium on offshore drilling will not have any meaningful effect on prices at the pump until at least 2030. The mantra and Bush's demand that Congress stay in session to lift the moratorium is simply partisan bluster. A Full Tank of Nonsense DO YOU HAVE THE WRITE STUFF?

meaning

It means drill here drill now and pay less.

Not only the Oil pipeline in Georgia

Thanks for the insight on the pipelines in the Balklands. Do you think the Russians are also wanting to take Georgia to hinder the U.S. from using Georgian airspace to attack Iran? Do you think the Russian are trying to gain proximity influence with the Middle Eastern countries? What do you think, will we now bolster Armenia and Ajerbaijan or do you think Russia to gain influence over them also to get closer to Iran? Since there may be a power vacuum coming up with United States pulling out of Iraq? What are the diplomatic relations between Russia, Iran, Armenia, and Azerbaijan? And what will this mean for world oil markets, especially if Iran were to shut down the oil exports through the Sea of Hormuz?

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