BP Halts Caucusus Oil Exports

By Cernig

Just a wee update to Ken's excellent essay on the Pipeline Cold War:

BP, the British energy group, said on Monday it had halted Caspian oil exports across the Caucasus altogether after a railway line in Georgia was damaged.

... BP closed its 150,000 barrels a day pipeline from Baku to Supsa on the Georgian Black Sea last Tuesday because of fears of fallout from Georgia’s conflict with Russia. BP also temporarily shut down a second pipeline carrying Azerbaijani gas exports to Georgia and Turkey. BP said the pipeline to Supsa had not been damaged during hostilities in Georgia.

Even before the conflict erupted in Georgia, oil exports from Azerbaijan had been drastically reduced by an explosion in early August on the Turkish section of the Baku-Tbilisi-Ceyhan pipeline to the Turkish Mediterranean, the main artery for Caspian exports across the Caucasus.

Kurdish separatists, probably working out of Kurdish Iraq where they more or less get the protection of local authorities, claimed responsibility for that latter attack on a pipeline that had been carrying 850,000 barrels a day. Everything's connected in today's globalized War On Terror.

Russia is now encouraging Azerbaijan to export its oil riches via Russian pipes. Regional oil experts are being very blunt about the West's options:

Analysts said the conflict in Georgia had exposed the fragility of trans-Caucasus pipelines and could spur the west to overcome its opposition to alternative, Iranian, export routes. The US gave strong political backing to the construction of the Caucasus pipelines in the 1990’s as part of a policy to break Russia’s stranglehold of Caspian oil export routes and isolate Iran.

Michael Carter, the head of research at Visor Capital, a Kazakh investment bank, said, ”If the west loses Georgia it will have to come to terms with Iran.” The alternative, he said, would be for ”the west to settle for all Caspian and central Asian natural resources going through Russian or Chinese pipelines.”

Which could go some way to explaining why suddenly the Nazis of The Month are no longer Ahmadinajhad and his cohorts.

But since when has NATO been an economic organisation or a democracy-promoting NGO?

With Georgia, we are now proposing to take in countries that were part of historical Russia. And it seems to me that it is an attempt at intimidation to press things this far. I'm sure it is taken that way in Russia.

We're acting as if it's membership in the Lions Club or the Rotary Club. NATO is supposed to be a serious organization that makes a solemn treaty commitment to go to war in defense of its individual members.

Didn't we already have a war that was supposed to secure the West's oil supply (one of the many touted reasons) and that instead only helped to raise oil prices? Do we really need an even bigger one with a state that still has 12,000 nukes?

Comments

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The BTC pipeline IIRC supplies about 20% of Israeli oil needs. I don't think they would be too thrilled with an Iranian alternative.