Thursday, January 24, 2008
The New Black Gold
As if all the soap opera-like drama of the past couple weeks involving pipeline shutdowns and jockeying for supply routes through Eurasia and the Balkans weren't enough, now comes news that Iran and Russia are spearheading an effort to bring the long-rumored "natural gas OPEC" to fruition. A draft drawn up by Iran last year and tweaked by Russia will be presented this June to the members of the Gas Exporting Countries Forum. The group's member nation's control 73% of the world's gas reserves and 42% of its production.
Needless to say, such a cartel poses a strategic problem for the US and EU. But there are plenty of faultlines that they could take advantage of to create a wedge between Iran and Russia. In particular, Iran is in desperate need of foreign investment to develop its natural gas capacity. The fatal flaw of current American policy is that by continuing to drive Iran and Russia together in a tactical arrangement, eventually we'll have helped them form the basis of a strategic alliance.