American Policies Towards the Caspian Sea and The Baku-Tbilisi-Ceyhan Pipeline - Dissertation Example

?American Policies Towards the Caspian Sea and The Baku-Tbilisi-Ceyhan Pipeline Introduction The role of the United s in the Caspian region has passed through several phases since 1991. Initially, Washington was not keen on asserting its influence in the region. This policy mainly stemmed from a lack of knowledge and initiative as concerning the Caspian region, as well as a lack of realisation of American interests there (William Ascher, 2000). The success of the Armenian lobby in convincing the American Congress to impose an embargo on Azerbaijan in the wake of the Nagorno-Karabakh conflict illustrates lack of proactive American policy in the region.1 However, by 1994-95, American policy was in a stage of transition. Azerbaijani oil resources and the war in Chechnya - a groundbreaking event that demonstrated Russia’s military capabilities to US officials - were the two factors, which prompted Washington to initiate assertive policies from the second half of 1996 onward. The United States has announced that it considers the Caucasus and the Caspian a region vital to US interests (William Ascher, 2000). This study will focus mainly on two questions. Firstly, are U.S. policies in the region serving to divide instead of acting as an integrating or unifying force? Secondly, do U.S. policies in the region prioritize economic-energy security or political-military security? When one tries to respond to the first question, the second question automatically comes to the fore because the changing economic and political security understanding of Washington after 11 September made it evident that the United States today, unlike in the 1970s, is not concerned about its hegemonic decline anymore; on the contrary, it is affecting the global order. Most importantly, it no longer feels threatened by its dependence on imported oil (Mustafa Ayd?n, 2004). Then, under these circumstances, one can argue that it is to the advantage of the United States to focus primarily on economic security which, for liberals, means creating factor mobility among national economies or a joint gains view of economic relations in Buzan’s terms (Mustafa Ayd?n, 2004). In order to respond to the above-mentioned questions this article aims mainly to focus on changing U.S. energy policies in the region after the 11 September disaster in terms of its relations with the Russian Federation and the Islamic Republic of Iran. The positive attitude of the United States toward the construction of the Baku-Tbilisi-Ceyhan (BTC) pipeline will be taken as a case study to assess whether Washington’s policies are serving to divide or acting to unify the countries in the region. In addition, Turkey’s increasing geo-political importance in terms of the construction of the Baku-Ceyhan pipeline is also a concern of this study (Michael P. Croissant, 1999). American Oil Diplomacy in Terms of Increasing U.S. Interest in the Caspian Basin The United States, who had become accustomed to expanding energy consumption with minimal concerns about the constancy of supply or sharp price escalation by 1972,3 never articulated or implemented a long-term and comprehensive energy strategy. Major energy initiatives were taken largely to address specific crises and they did not last. In other words, the Americans have done no way to deal with their ever-growing thirst for energy. The critics of the U.S. government claim that Washington has made energy goals secondary to other foreign policy objectives, particularly during the 1990s (Bahman, 2003). American sanctions policy, for example, has slowed the development of plentiful resources in Iran (and Libya), while Iraqi production has been held back by the United Nations. The sanction policy, thus, meant less diversification of sources. The answer to the question ‘Why then does the Bush administration still continue the sanction policy on Iran?’ is that the Bush administration views diversification of sources as a means of assuring the United States of political-military security rather than energy security, while it is generally thought that it places energy security before other foreign policy goals (Mustafa Ayd?n, 2004). In the report prepared by the National Energy Policy Development Group (NEPDG), which was established after the energy turmoil of 2000-2001,4 an explicit emphasis was put on securing more oil from foreign sources in order to support the U.S. and global economic growth. The reason for this is twofold (William Ascher, 2000). Firstly, the United States is unlikely ever again to be self-sufficient in oil with two percent of the world's proven oil reserves, although it is a leading energy producer. The second reason was the heavy interdependence between the American economy and those of Europe, Japan and other Asian nations, which means the U.S. national energy security depends on sufficient supplies not only for the American market but also for those of the U.S.’ major trading partners. In other words, high levels of imports by the U.S.’ friends and allies, as well as by the United States, means that energy security cannot be defined as self-sufficiency (Michael P. Croissant, 1999). In order to guarantee the continued flow of energy, Washington not only aims to remove political, economic, legal, and logistical obstacles in areas that are petroleum sources but also is determined to take steps to ensure that wars, revolutions or civil disorder do not impede foreign deliveries to the United States (Bahman, 2003). Thus, Washington appeared to have abandoned its traditional policy of taking energy initiatives as specific crises came out; on the contrary, the American unipolar system necessitated the existence of an American presence not only with its liberal economic policies but also with its military presence in regions such as the Persian Gulf area, the Caspian Sea basin, and Latin America. In this context, although Persian Gulf oil producers will remain central to world oil security, and the region will continue to be the primary focus of U.S. energy policy, the Caspian basin has been supposed to be a panacea as a new way of managing dependence with its potential, offering the possibility of production increases from 1.6 million b/d [barrels per day] in 2001 to 5.0 million b/d in 20105. The transportation to the oil resources of Caspian Basin from US, Israel and Western European regions were targeted to decrease the dependence on OPEC oil retailer in the Middle East. This was all created to secure the supply of oil to Israel and put an end to the Russian & Iranian oil dependence from the Caspian Region. This region is placed in between the two world’s energy powers OPEC Iran and non-OPEC Russia. This situation has created an enormous political instability and social disorder which in turn has added to the sense of exposure both in Iran and Russia via United States (Morten Anker, 2010). For many years, but especially since the mid-1990s, there developed what one may call two approaches or two schools of thought regarding the proper way to address U.S. policies in the region: The first preached conciliation and alignment, the other, containment and isolation. While conciliation meant bringing Turkey, Israel, and Europe under the same umbrella of interest and general aims despite the differing goals and priorities especially regarding commercial rivalry and favoring the partnership of Azerbaijan and Georgia with Turkey and the United States in what might be called the ‘Baku-Ceyhan bloc’, Washington’s policies of containment and isolation were meant to block Iran’s power in the area and to prevent Russia from reasserting hegemony over the region (Igor S. Zonn, 2010). United States Embassy, “Energy Concerns Cannot Constrain U.S. Policy, State's Larson Says: U.S. must have access to energy on terms supporting economic growth.” According to the US Treasury's data, the amount of the region's established oil reserve is around 34 billion barrels and the possible reserves are around 235 billion barrels. When we consider that the total of the established and possible reserves around 269 billion barrels, it can be seen that this amount equals to 26 percent of the current oil reserves. In addition, the figures given in terms of the natural gas are defined at 16-19 trillion cubic meters, which equals to 12% of the present natural gas reserves (Igor S. Zonn, 2010). When these figures are evaluated, it is understood that the Caspian region is in the third place coming after the Gulf of Basra and Siberia.” (Morten Anker, 2010) The above-mentioned policies of Washington have been strongly criticized on the ground that they led to a growing polarization of regional politics.8 Indeed, conventional wisdom has it that alliances bring about the formation of counter-alliances. The growing U.S. engagement in the Caspian region and the high profile and geo-political importance attributed to the Baku-Ceyhan project fuelled, in a way, the rapprochement between Russia, Iran and Armenia while it solidified a strategic alliance among Azerbaijan, Georgia, Turkey and the United States. However, the direction of the U.S. relations with Russia is very different from that with Iran. While Russia’s Caspian policy under Putin moved away from trying to contain U.S. expansion in the region in favor of ‘constructive engagement’ with the American government and oil companies, Iran was included in President Bush’s ‘axis of evil’ (Morten Anker, 2010). The immediate reaction of Russia to the American penetration of Central Asia, which was, from the Russian perspective, an effort to displace Russia and marginalize its influence, was to restructure the Commonwealth of Independent States (CIS) to tighten cooperation, to improve economic and political links with China and to improve relations with radical Middle Eastern This effort was created as a result of displacing Russian and marginalizes its influence and reorganize the Commonwealth of Independent States and intensify the relations with Middle Eastern states, especially Iran and Iraq. Russia has many economic and strategic levers in the region including security measures and the ability to obstruct pipelines; however, Moscow’s Caspian policy under Putin moved away from trying to contain U.S. expansion in the region in favor of a ‘constructive engagement’ with American government and oil companies (Guive Mirfendereski, 2001). Even in April 2001, in his speech to the Federal Assembly, Putin gave more prominence to Russia’s integration into the global economy than to hard line security issues. Putin’s permission for the deployment of U.S. troops and military bases in Kyrgyzstan, Uzbekistan and Tajikistan, bypassing the reactions of the Russian Defense Ministry in the name of supporting the U.S. war against terrorism in Afghanistan, illustrates the changing policies of Moscow in the region. In addition, the Russian Federation’s latest expression of intent by LUKoil to secure a 7.5 per cent stake in the Baku-Tbilisi-Ceyhan consortium is a sign that Russia does not want to be cut off from the Caspian oil riches (Guive Mirfendereski, 2001). There was a multitude of reasons for the change in Russia’s policy. But the foremost reason is the fact that Russia today is isolated and seems on the verge of being left out of the ‘Great Game’ that is taking place in its southern borderlands. The Russian Federation still could not secure a position of trusted partnership with the West and Russia’s inefficient energy network also prevents it from becoming a significant supplier to the U.S. market. Washington, worried by the unpredictability of Russia’s foreign policy at the outset, has played an active role in the Caspian region and has given its full support to the American oil companies13 whose activities in the region were obviously in line with some of the Trans-Caucasian and Central Asian states such as Georgia, Azerbaijan, Kazakhstan and Turkmenistan. Among the United States’ priorities in the region, safe access to the underwater hydrocarbon reserves and the creation of a neutral zone bordering Russia, Iran; Afghanistan and China come to the fore because the landlocked nature of the Caspian magnifies not only its infrastructure problems but also its security problems (S. Frederick Starr, 2005). It is of vital importance for Washington to prevent the region from becoming a breeding ground for terrorism and a hotbed of religious and political extremism and a battleground for outright war. For example, in the wake of armed incursions by elements of the Islamic Movement of Uzbekistan (IMU) into Kyrgyzstan in the summer of 1999, the United States formulated an extensive new Central Asian Border Security Initiative (CASI) in April 2000, with $3 million in additional security assistance to each of the five Central Asian states. The NATO Partnership for Peace program (PfP) also served as a key channel for U.S. (and Western) military engagement in Central Asia. Through the PfP, the newly independent, yet still vulnerable, Central Asian nations were able to gain significant experience and contacts with the U.S. military establishment. By 1999, the U.S. Congress expanded a commitment to military engagement with a special stress on military cooperation, both to Westernize and to professionalize the regional militaries but also to entrench the U.S. presence in this increasingly important place (S. Frederick Starr, 2005). The economic and political reforms in the countries of the Caucasus and Central Asia and the solutions to internal and cross-border conflicts are concerns of Washington. Therefore, the United States, for example, came to the conclusion that Section 907 of the Freedom Support Act15 hindered the U.S. energy diplomacy in the Caspian region; it changed its policy to one of providing Aliev’s regime with financial aid, which would help consolidate Azerbaijan’s prosperous secular government and thus protect U.S. investments in this country. The arrival of 18 American military advisers to train Georgian soldiers in antiterrorist operations is noteworthy with respect to understanding U.S. anxieties concerning the safety of future energy supply routes (Richard Giragosian, 2004). The American military presence in the region has affected not only the safety of future energy supply routes but also the power projection from Central Asia into Afghanistan and from Caucasus into the northern Middle East (most notably into Iran). The Islamic Republic of Iran stands as the sole country in the region reinforcing Washington’s sense of vulnerability concerning the spread of radical Islam and nuclear armaments (Richard Giragosian, 2004). Therefore, despite the growing pressure from U.S. oil companies to lift the embargo upon Tehran, which wants to be the main export corridor for Central Asian oil and gas, the U.S. administration is reluctant to soften its stance towards any Iranian role in the region. The U.S. policy, which has overly focused on pipelines, and specifically on efforts to ensure the construction of the Baku-Ceyhan pipeline for oil exports from Azerbaijan and Central Asia, aimed mainly at excluding Iran and at making Turkey a major actor in the region. The fact that Iran’s losses in the region happened to be Turkey’s gains confirms the belief that Washington’s policies do not have a unifying and integrating effect in the region (Igor S. Zonn, 2010). Iran, whose sense of vulnerability has been reinforced by the American presence not only in Afghanistan and Iraq but also in the Caspian Sea Basin, did not want to be marginalized strategically, and it has proposed the development of a pipeline from Baku to the Persian Gulf coast via Iranian territory to serve as an export route for Azerbaijan’s oil. (The construction of a 100-km oil pipeline to Tabriz in northern Iran would connect Azerbaijan to the Iranian pipeline network.) However, U.S. sanctions have acted as a barrier towards the construction of the above-mentioned pipeline and other alternative pipelines proposed by Iran19 on the ground that a pipeline through Iran would give it dangerous leverage over the economies of the Caucasus and Central Asia. As Peuch noted, ‘the real reason behind the U.S. policy towards Tehran is perhaps that the White House is reluctant to see Iran turn into a regional power which could pose a potential military threat to Israel and compete with Turkey in the Middle Eastern oil market.’ (Igor S. Zonn, 2010) The general belief in Washington, that ‘Only through a pax Americana the anarchic world can be saved’ is best illustrated by the current situation in Central Asia. The United States, whose main objective was the strategic encirclement of Iran and Russia by turning them into a new kind of desert, depending on America for all their needs, focused on precluding the emergence of any future competitor and basically aimed continued security collaboration at Central Asian states although these Central Asian regimes are generally repressive and autocratic. In other words, Washington, which has mislaid its earlier agenda of economic and political reform, has contacts with small corrupt clan-based elites in Central Asian states. It is also these very same elites that tend to monopolize military cooperation (Jean-Christophe Peuch, 2002). In other words it is marked as a transition from an apparent concern with energy and oil conservation to a precise importance on securing oil from foreign sources. Washington, thus, made energy security a priority of its trade and foreign policy. In parallel with this policy, and as an immediate consequence of 11 September, the United States expanded its military presence in Central Asia, Caucasus, and the Caspian Sea basin, areas traditionally viewed by Russia as its special sphere of influence (Jean-Christophe Peuch, 2002). The United States’s military presence and its liberal policies in the Caspian Sea basin and Central Asia has a dual function for U.S. policy. The first is related to Washington’s fear of being over-dependent on any one source of energy, especially a foreign source which would leave the United States vulnerable to price shocks and supply interruptions, because the Caspian basin serves to diversify the United States’ sources of imported energy since it is one of the non-OPEC areas like the west coast of Africa and Latin America. The other function is that the American bases in the region serve Washington’s policy of power projection from Central Asia into Afghanistan and from the Caucasus into the northern Middle East so as to enhance its capability for intervention. In sum, while the first objective arises from energy preoccupations, the other arises from security concerns (Hossein Razavi, 2007). The Soviet Union’s disintegration, but even more important, the rapid economic and military meltdown of Russia, led to the emergence of the United States as the pre-eminent global power. Washington’s determination to shape the world according to its values and interests explains why the United States prioritized a commitment to military engagement with Central Asia as well as to the democratization and marketization of the region. American policies were driven by overarching geopolitical considerations in order to contain the influence of China, Iran, and Russia (Hossein Razavi, 2007). In addition, by focusing on pipelines that will transport the Caspian Basin’s oil resources to the United States, Israel and Western European markets, In addition to this focusing on pipelines which will move the Caspian Basin’s oil deposits to the US, Israel and Western European markets Washington also aims to exclude Iran and Russia. For example, although the Baku-Tbilisi-Ceyhan pipeline is not commercially viable, and it is a strategic transportation route Washington pushed ahead with the project and did not accept the construction of the alternative pipelines proposed by Iran. Here the fear was that Iran would turn into a regional power, which could pose a potential military threat to Israel and compete with Turkey. The U.S.’ interpretation of Iran’s role in global terrorism not only creates problems in U.S.-Russian relations but also acts as a barrier to the long, slow process of Iran’s emergence from isolation: one step forward and two steps back. American fears of Tehran’s ambitions played an important role in encouraging a counter-alliance between Iran, Russia and China as a reaction to Baku-Ceyhan bloc (Gawdat Bahgat, 2003). In short, the fact that the Baku-Ceyhan project is essentially, from Washington’s perspective, a matter of paramount geo-strategic and political significance rather than an economic one, illustrates and even epitomizes that Washington’s policies in the region prioritize political-military security in order to ensure the stability of the region. However, the current regional engagement of the United States, which can be defined as drifting into an unplanned but protracted military presence, might be more threatening for Washington because according to Wallender,44 “If the U.S. presence and operations in the region do not bring stability and security while fuelling further extremism and terrorist attacks, it might be difficult for Putin’s Moscow to manage and silence domestic discontent created by America’s presence in Central Asia.” (Gawdat Bahgat, 2003) Currently, the U.S. faces a choice of two vastly different policy directions regarding Central Asia and the Caucasus. One would involve a unilateral strategy, based on self-defense and pre-emptive attack against Currently the U.S. had to face options of two dissimilar policy directions regarding Central Asia and the Caucasus. One structure makes use of unilateral strategy which is based on self-defense and preventive attacks against terrorist groups and regimes, while the second would support continued multilateral collaboration against trans-national threats. American policies focused on political and military security, as reflected in a unilateral strategy, do not put a high short-term priority on the democratization of the region’s countries. However, the weakness and volatilities of the regimes, in other words the domestic fragility of the region’s countries, poses the greatest potential threat to U.S. objectives and invites a rapid multiplication of challenges to U.S. engagements in the region. ‘The region’s countries share a landlocked dependency both in terms of relying on an external guarantee of security as well as in terms of economics and energy export routes.’45 Therefore, the United States views its presence as inevitable for the development and stabilization of the fragile states of Central Asia and the Caucasus, of weak states of Central Asia and the Caucasus although it is a long-term endeavor. At the same time, however, it is apparent that America’s enhanced military position did not prevent Washington from being vulnerable to transnational threats. Merely to fight terrorism in the region is insufficient; the United States must also encourage the region’s countries (including Iran) to diversify their economies and integrate into the world economy (Jean, 2001). One of the key lessons of 11 September is that despite its preponderant power, the United States remains vulnerable to terrorist attacks and requires the collaboration of other states to combat them. One of the main lessons of 11th September is that regardless of its dominant power, US remains susceptible to terrorist attacks and need collaboration of other independent states for combating. In Central Asia and the Caucasus, Washington needs to redefine its national interests and address the interrelated nature of political, economic and security problems in the region. And deal with the interconnected nature of political, financial and safety problems in the region Washington’s long-term interests in the region necessitate provision for the economic security of the region as a means to integration, development and globalization, which means it must promote joint policies to profit from energy development rather than geopolitical competition in the region (Jean, 2001). References: William Ascher, Natalii?a? Sergeevna Mirovit?s?kai?a?, North Atlantic Treaty Organization. Scientific Affairs Division, The Caspian Sea: a quest for environmental security: Springer, 2000 - Business & Economics Mustafa Ayd?n, Cagr? Erhan, Ankara Universitesi. Siyasal Bilgiler Fakultesi, Turkish-American relations: past, present and future: Routledge, 2004 - Political Science Michael P. 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Florida:University Press of Florida, 2003 Richard Giragosian, 'The US Military Engagement in Central Asia and the Southern Caucasus: An Overview', Journal of Slavic Military Studies, Frank Cass 2004, ISSN:1351-8046 DOI:10.1080/13518040490440656. 'Section 907 of the Support of Freedom Act forbids US aid to Azerbaijan because members of the US Congress accuse of Baku ignoring its civil and political rights.' Andrew F. Tully, 'Caspian Experts Urge US Policy Change', May 25, 2001 in http://www.rferl.org/features/2001/05/25052001123110.asp Jean - Cristophe Peuch, 'Private and National Interets in the Caspian Region', in The Politics of Caspian Oil. Edited by Bulent Gokay. Palgrave Publishers, London, 2001,175. Jean-Christophe Peuch, 'Caucasus: Energy Projects Given Impetus By Regional Summit, Arrival of US Soldiers', 6 November 2002 in http://www.rferl.org features/2002/06/11062002163012.asp 'The Russian Foreign Minister Igor Ivanov said that the US military presence in Georgia could further aggravate the already complicated situation in the region' Emad Mekay, 'Development: Georgia Oil Pipeline Hurting Local Investment-Group', Global Information Network, October 3, 2003, 1. Read More