Thursday, January 10, 2008
Sending It Down The Line
Just before New Year's, Turkmenistan shut down the gas pipeline supplying Iran with 5% of its domestic consumption. The reason was ostensibly technical malfunctions, but the malfunctions have oddly enough not yet been repaired. As the shutdown coincides with a fierce cold front that has gripped the region and sent temperatures plummeting, Iran in turn all but shut down the pipeline that supplies Turkey with roughly the same amount of Iranian gas that Iran imports from Turkmenistan. Russia, which has in the past made up Turkey's gas shortfalls, in this case not only refused, but suggested it would be forced to reduce its deliveries as well, due to a supply shortage.
The entire episode demonstrates either, a) the ways in which weather can impact on international relations; or b) the complex energy calculus underlying, and at times working at cross-purposes to, some of the strategic re-alignments in the region. And for a number of reasons, not least of which being that this is not a weather forecasting site, I'm going to go with "b".
For a little background, Russia recently secured a contract with Turkmenistan for its gas reserves. The deal was considered a serious blow to American and Western European hopes for securing Turkmenistan's gas supplies independently of Russia. It was also part of what some suggested was a broader cartel strategy by which Russia and Iran would carve up the gas market: Western Europe for Russia; Asia for Iran. Tehran's imminent pipeline and purchase deal with Pakistan, as well as its negotiations with China and India to develop domestic gas and oil fields can be understood in this context.
But the same deal between Russia and Turkmenistan is also the source of this week's rolling pipeline shutdown, because Russia agreed to pay twice the price that Turkmenistan gets from Iran, and the "technical malfunctions" notwithstanding, it's no secret that Turkmenistan is looking to renegotiate with Tehran.
As for Turkey, it's also no secret that both Iran and Russia were counting on taking advantage of recent tension between Ankara and Washington to forge closer relations with Turkey. Both Iran's decision to pass the gas shortage down the line and Russia's decision to sit on its hands coincide with the recent rapprochement between Ankara and Washington, culminated by President Bush's warm reception of Turkish President Abdullah Gul two days ago at the White House. The visit was the occasion not only to reaffirm America's strategic relationship with Turkey, but also to roll out a very ambitious role for Turkey as a regional energy hub for both Iraqi and Eurasian gas and oil reserves.
As the episode demonstrates, none of these tactical alliances are stable. The entire region is in a flux, and it's not at all clear how things will settle in the long run. The uncertainty, while volatile and unfamiliar, can also be used to our advantage, should we adopt an intelligent and flexible strategic approach. Our enemies and rivals of today might turn out to be, if not our friends of tomorrow, at least useful leverage points.
One thing is certain. There's a bunch of Greeks freezing their souvlakis off who had nothing to do with this whole mess.