http://www.atimes.com/atimes/Global_Economy/HG14Dj03.html
THE ROVING EYE
Russia and Iran lead the new energy game
By Pepe Escobar
Whatever the West may have thought about it, Russian President Vladimir
Putin has already spectacularly preempted this weekend's Group of Eight
(G8) summit in St Petersburg with his own bit of Pipelineistan news.
Putin announced in Shanghai on June 15 that "Gazprom is ready to support
the construction of a gas pipeline from Iran to Pakistan and India with
financial resources and technology".
He was referring to a fabled US$7 billion, 2,775-kilometer, 10-year old
project - an Iranian idea - which should now be finished by 2009,
developed
by Gazexport, a Gazprom subsidiary. As a result, by 2015 both India and
Pakistan should be receiving at
least 70 million cubic meters of natural gas a year.
Thus the two top global gas producers - Russia and Iran - reached a
strategic partnership abiding not only by their own interests but the
interests of India, Pakistan, China and part of Central Asia, something
that spells nothing less than an auspicious economic future for a great
deal of Asia - independent from any American interference. Washington
was not amused.
Not surprisingly, everyone else in the region begged to differ. For Iran
this represents the coveted Pipelineistan way to the east. India will
save at least $300 million a year. Pakistan will receive as much as
$600 million a year in transit fees. The pipeline will inevitably be
extended to Yunnan province in China. No wonder the announcement was
made at the annual meeting of the Chinese-inspired Shanghai Cooperation
Organization (SCO).
The Russian masterstroke is to divert the bulk of upcoming Iranian gas
exports to Asia - while Russia is still negotiating a very complex and
very lucrative deal with Brussels to supply the European Union. Tehran
and Moscow have reached a remarkable agreement. Putin and Iranian
President
Mahmud Ahmadinejad will be working in tandem. In Shanghai they all but
decided to consult on all matters regarding gas prices and the new
routes
of Pipelineistan. Control of prices plus transportation routes obviously
spell out a gas OPEC (Organization of Petroleum Exporting Countries)
just
around the corner (Putin though was careful to dub it just "a joint
venture",
not a cartel).
In practical terms Gazprom (See The Gazprom nation Asia Times Online,
May 26) Now, a decade and a half after the end of the Cold War, the US
and Russia's lines of friction are startlingly similar: Eastern Europe,
the Black Sea basin, Ukraine, Moldavia, Georgia and Iran. Sixty years
ago,
the Soviet Union offered Iran an energy partnership. Now Moscow is
offering
not only a nuclear partnership - building the nuclear reactor in Bushehr
-
but still an energy partnership, in the manner of selling its own gas
wealth
the most profitable way for both sides.
Putin is an accomplished chess player. Accusations of heavy-handedness -
on civil liberties and on energy policy - aside, the Kremlin does not
need
a confrontation with the "colonialist" West (the qualification is
Putin's).
What it needs is to find the best use for the massive financial flows
that
are pouring over Russia. The Russian weekly Vlast identifies "a new
Russophobia
in the West, hypocrite and erroneous". The Russian response is to
challenge the
West to accommodate to its own terms. The Kremlin calls its own internal
experiment "sovereign democracy". As the Kommersant daily put it, "the
West
must answer to a series of ultimatums posed by Russia, including its
refusal
of European rules on the energy market, it particular position regarding
Iran and the assurance of non-intervention on Russian internal affairs".
Putin's message to the G8 is loud and clear: we're back. And this
Gazprom
nation, also reveling on oil at $75 a barrel, and rising, is doing
things
its own way - like exterminating, with perfect timing, public enemy
number
one, Chechen rebel leader Shamil Basayev, or banishing homeless people,
street vendors, intellectuals and opposition voices from St Petersburg
ahead of the G8 summit. There's virtually nothing the West can do about
it. Russia is not struggling to be part of "the West" anymore; it has
evolved its own system, and not unlike the Middle Kingdom, at the center
of the system lies the Kremlin.
Preemption is the (Russian) name of the game. Russia's strategic
partnership
with China has been solidified via the SCO. On the ultra-sensitive
Iranian
nuclear dossier, Moscow's game is extremely flexible, and all about
nuance,
as are Russia's relations with the Islamic world. It is charging market
prices to both Ukraine and Georgia for its gas. And sooner - rather than
much later - the gas OPEC with Iran and Central Asia may be a done deal.
(Copyright 2006 Asia Times Online Ltd. All rights reserved. Please
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