Tag: Russia
Who has gas?
President Putin’s cancellation of the South Stream pipeline project leaves parts of the Balkans vulnerable to a supply disruption and without sufficient future gas supplies. This is a rare opportunity for the European Union and the United States. South Stream would have tied Serbia, Bulgaria and others umbilically to a Moscow that is hard to like and unreliable. Sanctions and lower oil and gas prices killed the project. Finance had already killed its Western-backed competitor, Nabucco. Now what is needed is some active diplomacy to ensure that any future projects undermine Russian pretensions in the Balkans.
So where else might the gas come from? The planned TANAP/TAP (Trans-Anatolian Natural Gas/Trans-Adriatic) pipeline will bring gas to the Balkans (Turkey, Greece, Albania and Bulgaria) as well as Italy from Azerbaijan and eventually Turkmenistan. Construction is supposed to begin in 2015. This is a good but partial solution for 2020 and beyond.
There are many additional options, at least in the long term: Croatia and Montenegro have contracted for exploration in the Adriatic, where it is known deposits exist. Libyan gas already enters Europe through the Italian peninsula not far from the Balkans. Eastern Mediterranean gas lies not far away, and Iraqi gas not all that much farther.
Of these options, Libyan gas is in principle the quickest and easiest, not least because it is already flowing close by. Caveat emptor, as always: Libyan gas production has not recovered to prerevolution levels, though ongoing political instability has affected gas supplies less than oil production. Once Libya achieves a modicum of stability, it might be possible to build a pipeline from Italy to the Balkans that could be fed in the future by Adriatic gas, once that is developed. Israeli/Greek/Cypriot gas is a longer shot, but not impossible if the political knots ever get untied. Iraqi gas, shipped either from Kurdistan or the Sunni-majority provinces of Anbar and Ninewa, would be geopolitically a great way to tie Iraq to Europe, but shipment to Turkey may well prove the more economical proposition.
In the meanwhile, the Balkans have quite a bit to worry about if Russian gas is constricted or cut off anytime during the rest of this decade. That is unlikely this year because of lower prices, which increase Moscow’s incentive to export in order to maintain revenue (and commitments have already been made). Liquefied natural gas, which might come from Qatar or eventually even the US, may provide some insurance. The EU is backing a terminal in Croatia,but that option is expensive and won’t be built for years.
For the near term, the EU has been encouraging a market-based approach as well as pipeline interconnections and storage, so that gas can be stored and shipped more readily to and around the Union, including to the Balkans, should the need arise. That is the kind of solution that has worked so well in the US, which has built enough interconnections to make the entire country a single gas market:
Europe isn’t so far off from that, but the Balkans clearly need more connectivity:
There is no one solution to the gas problem in the Balkans. Wise heads should be pondering how to make sure that whatever menu of options is chosen is economically viable and has the kinds of geopolitical impact the US and Western Europe will find beneficial. That means diversification and resilience above all, with reduced dependence on Russia. Moscow would make far less trouble in countries like Bulgaria, Bosnia, Serbia and Montenegro if the Balkans had alternative sources of gas.
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Scraping the bottom of the barrel
With the likes of Josh Landis predicting more of the same (fragmentation, radicalization, impoverishment, displacement) in Syria, it would be more daring than I am to predict improvement. But it is still interesting to ask what could possibly make a difference and turn things in a more positive direction?
There are two propositions on the table at the moment.
One is the UN-proposed “freeze” for Aleppo. This is intended to be more than a ceasefire. It would freeze the warring forces in place, thus preventing them from simply being redeployed to fight elsewhere, as well as initiate local governance on a cooperative basis between the opposition and the regime. Monitoring would initially have to be local, with international observers deployed in due course. In the absence of effective monitoring, the regime would be likely to use any such freeze to redeploy its forces (including intelligence cadres and paramilitaries) to the south, where the opposition is making headway. It is much harder for the opposition to follow suit, because its fighters generally focus on their home areas and its supply and logistical support is far less developed.
The second proposition is a Russian proposal for intra-Syrian dialogue. This will supposedly convene January 26-28 on the basis of the June 2012 Geneva communique, which calls for an interim governing body with full executive powers. Moscow, Tehran and the Syrian regime view this formula as allowing Bashar al Assad to remain in place and preside over a “national unity” government. The opposition and Washington say it means Bashar has to exit, or at least give up all executive power (which if implemented would mean that he would consequently exit sooner rather than later). There is no sign that this difference of interpretation has been bridged.
Separately, neither of these propositions seems likely to succeed. The Americans and Europeans are allowing both to move along, faute de mieux. The question is whether together they might be more likely to produce some sort of positive outcome.
I’m not seeing it yet. The missing ingredient is enforcement. Only if and when the international community gets together behind a UN Security Council resolution that makes it clear Bashar will suffer irreparable damage to his hold on power will he be willing to countenance a serious ceasefire in Aleppo that blocks him from redeploying his forces. This would require the Americans to be prepared to execute air strikes if there is a violation. As for creation of an interim governing body with full executive powers, enforcement would rely heavily on Russian willingness to cut Bashar’s military and financial supply lines if he transgresses. Putin has given no indication he is prepared to do that. Even if he were, Iranian support might keep Bashar afloat.
This brings us back to the inevitable: there is no diplomatic solution in Syria in the current military situation unless Washington and Moscow come to terms and agree on one, including a mutual commitment to enforcement. They certainly have a common strategic interest in a negotiated settlement. Both capitals want the Islamic State and Jabhat Nusra, the main jihadi extremist organizations, defeated. They differ mainly on whether Bashar al Assad is a bulwark against the jihadis or an important cause of their presence.
Richard Gowan suggests there might be room for the US and Russia to reach a “dodgy” grand bargain based on a trade-off between Ukraine and Syria: Moscow would temper its support for separatists in eastern Ukraine (and get some sanctions relief) in exchange for Washington backing off its demand for Bashar to step down. The trouble with this idea is that Washington has already backed off, because it gives priority to fighting the Islamic State. It might be more likely the other way around: Moscow could back off support for Asad and temper support for separatism in Ukraine in return for Washington allowing some sanctions relief.
Like Russia, Iran props up Asad because it sees him as an ally against Sunni extremism, but Tehran has also needed Asad as a reliable link in the “resistance” chain that it has forged with Hizbollah and Hamas. There is no sign Iran is prepared to abandon Damascus. Even under sanctions and with lower oil prices, Tehran is providing ample men, weapons and financing. A nuclear deal this year would make that easier to sustain, as multilateral sanctions are at least partially lifted.
Freeze, intra-Syrian dialogue, grand bargain: we are scraping the bottom of the barrel. There may be something there that will work, but the odds are not good.
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Ramifications
The United States is to establish diplomatic relations with Cuba. Stronger than expected economic and job growth. American companies repatriating. Russia cancels natural gas pipeline. Pro-Russian separatist push in Ukraine stalls. Iran declares its commitment to reaching a nuclear agreement. Baghdad reaches oil export and revenue agreement with Erbil
Today’s headlines may seem disconnected, but there are two common threads: oil and money, which themselves are tightly wound together.
Little explanation is needed. The Cuban regime is on its last economic legs. It needs an opening to the US to survive. Its massive subsidies from Venezuela are coming to an end, because Caracas is one of the countries most forcefully hit by the decline in oil prices. The economic upturn in the US, and return of US companies from abroad, is at least partly due to more cash in consumers’ pockets, due to lower prices at the pump, and readier availability of energy resources. Russia’s South Stream pipeline fell victim to the combination of sanctions and lower natural gas prices. Russian support for the separatists in eastern Ukraine is falling short in part because the Russian economy is in an oil-price-induced nose dive, along with the ruble. Iran needs a nuclear agreement more than it did a few months ago in order to get sanctions relief that will help it deal with lower oil prices. Both Erbil and Baghdad needed an agreement, not only because of the ISIS threat but also because of lower oil prices, which pinch their finances as much as ISIS’s.
It would be nice to hear some other good news: reduced Russian and Iranian support for Syria’s President Assad, a pickup in China’s economy, and an end to recession in Europe are all within the realm of the possible. May this icy account of an official Iranian visit to Assad is a harbinger.
There is of course a price to pay for the benefits of lower energy prices. US oil and gas production, which had been climbing rapidly at $100/barrel, will slow down at $50/barrel. Oil company stocks are down. The stock market is jittery. Kim Jong Un, his economic woes relieved, is emboldened and less vulnerable.
The balance for America’s foreign policy is however positive. It is also likely to be long-lasting. American oil and gas production may stop climbing so fast, or even fall, laying the foundation for another price rise in the future. But the new technologies that enable exploitation of “tight” oil and gas are viable at anything above $80/barrel, and likely at prices a bit lower. Nor is the US the only country in which these technologies can be used. China, the UK, Poland and many others also have “tight” oil and gas. Once they start producing it, $80/barrel or so will become a ceiling for oil prices, a level that will require serious fiscal discipline in many oil-producing countries, both friend and foe. Russia, Venezuela and Iran have all been budgeting at $100/barrel or more.
The demand side also has an impact on foreign policy. While supply has been booming in the Western Hemisphere, demand is booming in the East, especially China and India. Middle Eastern oil that used to get shipped to Europe and the US will now go to Asia. That is already true for 50% of the oil coming through the strait of Hormuz. The percentage is headed up to 90% within the next decade. US diplomats are busily reassuring Gulf oil producers that Washington is fully committed to maintaining its close relations with them, but it is hard to believe we are that dumb (or that they are).
Rapidly declining oil imports from the Gulf will eventually make the Americans reevaluate. If and when the Iranian nuclear issue is resolved, Washington will want to renew the effort to move its diplomatic and military attention even more definitively to the East, where its economic and commercial focus already lies. China and India will have to pick up more of the burden for energy security, by holding larger oil stocks (neither keeps the 90 days that International Energy Agency members commit to) and naval patrolling. The US should be welcoming them with open arms into a multilateral effort to protect Hormuz. A few extra burdens of this sort would also encourage New Delhi and Beijing to restrain their oil demand and contribute more to limiting global warming.
The ramifications of lower oil prices are profound. We would do well to start thinking hard about them and acting accordingly.
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The troubles we see
This year’s Council on Foreign Relations Preventive Priorities Survey was published this morning. It annually surveys the globe for a total of 30 Tier 1, 2 and 3 priorities for the United States. Tier 1s have a high or moderate impact on US interests or a high or moderate likelihood (above 50-50). Tier 2s can have low likelihood but high impact on US interests, moderate (50-50) likelihood and moderate impact on US interests, or high likelihood and low impact on US interests. Tier 3s are all the rest. Data is crowdsourced from a gaggle of experts, including me.
We aren’t going to be telling you anything you don’t know this year, but the exercise is still instructive. The two new Tier 1 contingencies are Russian intervention in Ukraine and heightened tensions in Israel/Palestine. A new Tier 2 priority is Kurdish violence within Turkey. I don’t believe I voted for that one. Ebola made it only to Tier 3, as did political unrest in China and possible succession problems in Thailand. I had Ebola higher than that.
Not surprisingly, the top slot (high likelihood and high impact) goes to ISIS. Military confrontation in the South China Sea moved up to Tier 1. Internal instability in Pakistan moved down, as did political instability in Jordan. Six issues fell off the list: conflict in Somalia, a China/India clash, Mali, Democratic Republic of the Congo Bangladesh and conflict between Sudan and South Sudan.
Remaining in Tier 1 are a mass casualty attack on the US homeland (hard to remove that one), a serious cyberattack (that’s likely to be perennial too), a North Korea crisis, and an Israeli attack on Iran. Syria and Afghanistan remain in Tier 2 (I think I had Syria higher than that).
The Greater Middle East looms large in this list. Tier 2 is all Greater Middle East, including Libya, Egypt, Jordan, Lebanon, Pakistan, Turkey and Yemen (in addition to Tier 1 priorities Israel/Iran, Syria, Afghanistan and Palestine). That makes 11 out of 30, all in the top two tiers. Saudi monarchy succession is not even mentioned. Nor is Bahrain.
Sub-Saharan Africa makes it only into Tier 3. Latin America and much of Southeast Asia escape mention.
There is a question in my mind whether the exclusively country-by-country approach of this survey makes sense. It is true of course that problems in the Middle East vary from country to country, but there are also some common threads: Islamic extremism, weak and fragile states, exclusionary governance, demographic challenges and economic failure. From a policy response perspective, it may make more sense to focus on those than to try to define “contingencies” country by country. If you really wanted to prevent some of these things from happening, you would surely have to broaden the focus beyond national borders. Russian expansionism into Russian-speaking territories on its periphery might be another more thematic way of defining contingencies.
One of the key factors in foreign policy is entirely missing from this list: domestic American politics and the difficulties it creates for a concerted posture in international affairs. Just to offer a couple of examples: failure to continue to pay Afghanistan’s security sector bills, Congressional passage of new Iran sanctions before the P5+1 negotiations are completed, or a decision by President Obama to abandon entirely support for the Syrian opposition. The survey ignores American “agency” in determining whether contingencies happen, or not. That isn’t the world I live in.
For my Balkans readers: no, you are not on the list, and you haven’t been for a long time so far as I can tell. In fact, it is hard to picture how any contingency today in the Balkans could make it even to Tier 3. That’s the good news. But it also means you should not be looking to Washington for solutions to your problems. Brussels and your own capitals are the places to start.
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Peace Picks December 1-5
- The Battle for Eastern Ukraine | Monday, December 1st | 12:00 – 1:00 | Heritage Foundation | REGISTER TO ATTEND | The battle for the future of Ukraine rages on. Despite a ceasefire negotiated in Minsk in September, in Donetsk and Luhansk in Eastern Ukraine, separatists supported by Russia continue to fight Ukrainian forces. Recently, the Russian military has again directly intervened across the border in support of the rebels. Recent elections in the two regions, won by Russian supported candidates, were described by Ukrainian President Poroshenko as a “farce.” As winter approaches, Ukrainians will be dependent for heat on Russian energy supplies, at rapidly escalating prices. What are the Obama administration, the European Union and NATO doing to support Ukraine’s national and territorial integrity? What does the winter hold for Ukrainians? The speakers are Luke Coffey, a Fellow at the Heritage Foundation, Peter Doran, Director of Research at the Center for European Policy Analysis, and Mykola “Nikolay” Vorobiov, a Ukrainian Journalist and Blogger.Helle C. Dale will moderate.
- Jerusalem in Crisis? A Conversation with Danny Seidemann | Monday, December 1st | 12:00 – 1:10 | Woodrow Wilson Center for Scholars | REGISTER TO ATTEND | Are we on the verge of another sustained Israeli-Palestinian confrontation along the lines of 1987-1992 or 2000-2004? Why has Jerusalem become the focus of the current tensions and violence, and what if anything can be done about it? A conversation with Danny Seidemann, leading expert on geopolitical Jerusalem and moderated by Aaron David Miller, Vice President for New Initiatives and Distinguished Scholar at the Woodrow Wilson Center.
- Breakthrough or Extension: Implications for US and European Relations with Iran | Tuesday, December 2nd | 10:00| Atlantic Council | REGISTER TO ATTEND | Expectations are rising that Iran and the five permanent members of the United Nations Security Council plus Germany will reach an agreement on key elements of a comprehensive nuclear agreement trading long-term curbs on Iran’s nuclear program for phased relief of economic sanctions. A breakthrough could significantly improve the chances for US and European cooperation with Iran in dealing with other regional challenges, particularly the rise of the group calling itself the Islamic State of Iraq and al-Sham, and could also motivate Western businesses to sign new deals with Iran. Speakers will discuss the implications of a deal or a possible extension of negotiations for both political and economic relations with Iran. They will also comment on the possible ramifications of the midterm election results for an agreement with Iran and what impact it may have on the easing of sanctions. On the panel are Clifford Kupchan , Chairman of the Eurasia Group, Cornelius Adebahr, Associate for the Europe Program at Carnegie Endowment for International Peace, Erich Ferrari, Attorney at Law at Ferrari & Associates P.C., and moderated by Barbara Slavin, Senior Fellow in the South Asia Center at Atlantic Council.
- The Outcome of the Iran Talks and the Next Steps | Wednesday, December 3rd | 9:30 – 11:00 | Carnegie Endowment for International Peace | REGISTER TO ATTEND | Negotiators from the P5+1 and Iran are racing toward a comprehensive agreement on Iran’s nuclear program by the November 24 deadline. Many issues, such as establishing a formula that verifiably limits Iran’s uranium-enrichment capacity, are still to be solved, but both sides of the negotiating table have stressed the need to reach an agreement. A briefing with George Perkovich, Karim Sadjadpour, Daryl Kimball, and Elizabeth Rosenberg on the outcome of the negotiations and next steps. Kelsey Davenport will moderate.
- Ebola: The Intersection of Cultural, Historical, and Political Dynamics in West Africa | Wednesday, December 3rd | 12:30 – 2:00 | Johns Hopkins School of Advanced International Studies | Michael McGovern, associate professor of anthropology at the University of Michigan, will discuss this topic.
- American Views of U.S. Foreign Policy: Public Opinion on the Israeli-Palestinian Conflict | Friday, December 5th | 10:00 – 11:30 | After the collapse of Israeli-Palestinian peace negotiations earlier this year and the devastating violence of this summer’s Gaza war, tensions between Israelis and Palestinians are on the rise. Voices on both sides of the conflict question the United States’ traditional role as shepherd of Israeli-Palestinian peace negotiations, and Americans seem increasingly skeptical about their government’s engagements in the Middle East.It’s crucial to look beyond this skepticism to specifics. How much importance do Americans attach to the Israeli-Palestinian conflict, and to reaching a resolution? How do different communities in the United States—Democrats, Republicans, minorities, youth, older Americans—vary in their attitudes toward Israelis and Palestinians? Beyond the question of who is more “at fault” in the conflict, what kind of future for Israel and the Palestinians do Americans think the United States should support? The speakers are Shibley Telhami, Nonresident Senior Fellow at Brookings Institution, and William A. Galston, Senior Fellow at Brookings Institution. The moderator will be Tamara Cofman Wittes, Director for the Center for Middle East Policy.
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Doubts about Putin’s credentials
American Ambassador John Tefft presented his credentials to President Putin today in Moscow. Putin’s remarks were pointed:
We are ready for practical cooperation with our American partners in various fields, based on the principles of respect for each other’s interests, equal rights, and noninterference in internal matters.
That “we are ready” betrays Moscow’s reaction to the sanctions squeeze the EU and the US have mounted. It is hurting, as is the fall in oil prices. Moscow is wise to be signing big contracts to sell gas to China, but it will be years before deliveries begin. In the meanwhile, a budget calculated at over $90 per barrel is under real pressure. The ruble’s fall compounds the problem.
Less promising is Putin’s concept of respect for each other’s interests and equal rights. He has promulgated an expanded notion of Russia’s interests. They extend in his thinking to all Russian-speaking populations in neighboring states. The pattern is clear: in Georgia, Moldova and Ukraine, Moscow has preserved or carved out separate governance for Russian speakers (in South Ossetia and Abhazia, Transdniester and Crimea). He is trying to do the same thing in the Ukrainian part of Donbas, a region that straddles the Ukraine/Russia border.
This is not an effort to reconstruct the Soviet Union. Putin may regard its collapse as a catastrophe, but he knows that the more Western-oriented parts of the Soviet empire are not going back to Moscow’s fold. What Putin is doing is akin to Milosevic’s effort to implement the Serbian nationalist dream of all Serbs in one state by helping Serb-populated territories outside the borders of Serbia proper establish or sustain separate states. Milosevic failed in Croatia and Kosovo and ended up with hundreds of thousands of Serb refugees who fled from those places. But he succeeded in Bosnia, where Republika Srpska is the kind of separate governance Putin envisages in Donbas.
Putin’s concept of “noninterference in internal matters” also merits scrutiny. I was told repeatedly during a fall visit to Moscow that Americans needed to understand that Ukraine is an internal issue for Russia. That was sufficient evidence for me that Moscow does not respect Ukraine’s sovereignty and territorial integrity. More evidence: the Russian claim that the US promised that NATO would not expand. The constant public refrain of the Americans after 1989 was “Europe whole and free.” In what universe does “free” not include the right of European states to join whatever alliance will have them?
Of course Putin also means by noninterference that Washington should not support democracy advocates in Russia. He has in fact restricted US efforts to support independent voices and cracked down on many of them. Here he is within his rights I suppose, as the United States was (from an international law perspective) during the Cold War when it restricted the activities of the Communist Party. But Senator McCarthy’s red scare wasn’t the America’s proudest moment. Imitating it won’t be Russia’s. Allowing and protecting dissent is a sign of a state’s strength, not weakness.
Putin accepted John Tefft’s credentials. But America should have profound doubts about Putin’s.
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