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04-23-2002
The repercussions of the failed coup against Venezuelan President Hugo Chavez extended halfway across the world to the shores of the Caspian, where the leaders of the littoral nations are set to meet to discuss dividing the sea’s abundant energy resources. Instability in Venezuela, the world’s fourth-largest oil supplier, has Eurasian states scrambling to seize the moment of opportunity for their own energy sectors.
Like leaders in Turkmenistan, Uzbekistan, Georgia and Azerbaijan, Venezuelan politicians use their countries’ oil riches as leverage when negotiating with the United States and Europe. With the world’s fourth-largest oil supply held hostage, 60-year-old Pedro Carmona became an unlikely coup leader. Carmona, the head of Venezuela’s largest chamber of commerce, had earned a reputation for authoritarian leanings. On April 9, weeks after starting to protest the appointment of Chavez cronies to the board of the state oil company, Carmona and Venezuela’s largest trade union group organized a general strike. Two days later, the military shot at a massive opposition march, killing 16 protesters. The military kicked out Chavez, and appointed Carmona as head of a junta. Carmona promptly dissolved the National Assembly, Constitution, courts and public offices - he later told Venezuelan newspapers he had done this "to facilitate a rapid transition to new elections" - but the plotters soon gave in to popular revolt and reinstated Chavez on Sunday April 14.
The two-day drama echoes the 1991 Russian coup attempt that killed the Soviet Union. Like the Communist bureaucrats who seized and then lost the Kremlin, Carmona blamed staff for his failure, claiming that numerous people wrote and rewrote decrees dissolving public institutions during the chaos. But while the Soviet Union was a foundering economy, Venezuela’s state-controlled oil company is the United States’ third-largest supplier.
Diplomats in Washington are pointing fingers in the wake of charges that the Bush administration failed to adequately condemn an antidemocratic coup. But whatever the diplomatic fallout, energy analysts and foreign policy experts agree that the episode raises serious long-term questions about the political risk in the United States’ three biggest suppliers - Saudi Arabia, Iraq and Venezuela. While nobody suspects Venezuela of harboring terrorists, the coup attempt has made its oil supply seem as vulnerable to manipulation as any Persian Gulf nation’s. This realization is pushing the United States to seek new sources of energy.
Compared to Venezuela, Russia and the Caspian nations look very stable. On April 18, a week after Chavez returned, Russian President Vladimir Putin delivered his State of the Federation address to the parliament. The address focused on the necessity to improve the state bureaucracy and assure faster economic growth and more foreign investment. Moreover, Putin spoke little about Russian foreign policy, generally acknowledging that Russian military competition will be much less important than economic competition.
He dedicated seven out of nine paragraphs to the Commonwealth of Independent States (CIS), clearly making relations with the former Soviet republics a top priority in Russian foreign policy. The leading opportunities for absorbing foreign investment - and some of the most fruitful joint venture prospects between Russia and its former republics - lie in the energy sector. Russia clearly is striving to connect its desire to become a major player in the global energy markets with its dominant role in the "near abroad."
One way to boost Russia’s standing with oil purchasers and would-be oil exporters is to develop private companies’ capacity. CEO Mikhail Khodorkovsky of Yukos Oil, Russia’s fastest-growing company, addressed this on April 16, when he joined Mikhail Friedman and Petr Aven of the Alfa-Group, which includes the Tyumen Oil Company, for a symposium at the US-Russian Business Council. The speakers agreed that Russia’s economy needs to grow more steeply than the 3.5 to four percent annual rate currently forecast by Economic Development Ministry. Critically, in light of Venezuela’s turmoil, they assert that Russia can conduct an energy policy independent from the OPEC cartel, eventually boosting production to the Soviet-era level of around 450 million tons a year.
Other Russians also seem eager to bring modern technology and salesmanship to the nation’s natural resources. Leonid Grigoriev, a prominent Russian economist and an advisor to the Ministry of Energy, says Siberia has the largest coal resources on the planet. He says these can produce competitively priced power if they acquire modern technology. More broadly, the Putin Administration is sparing no effort to organize the post-Soviet countries in the Caucasus and Central Asia into the Eurasian Economic Union (EEU) and Eurasian Energy Community (EEC), which will coordinate oil and natural gas exports from Russia, Kazakhstan, Azerbaijan and Turkmenistan.
Putin often conducts phone conferences with the Kazakhstani president Nursultan Nazarbayev and other regional leaders to discuss energy policy. He also planned to press Azerbaijan, Iran, Kazakhstan, and Turkmenistan toward an agreed method for dividing the Caspian Sea’s resources at the Caspian summit in Ashgabat on April 23.
Even though Putin enjoys more stability and has focused more squarely on energy investment than Chavez, Russian coordination efforts are moving too slowly to make them a short-term substitute for Venezuelan supply. So far, plans to form a unified Central Asian energy network have run into bureaucratic resistance and ineptitude. If Putin overcomes this resistance, these organizations may help him counter-balance the increasingly unstable Gulf producers and increase Russia’s influence along its periphery. This would provide a multiplier to Putin’s geo-economic strategy.
As Venezuela’s reputation founders, many multinational energy firms already have put down stakes in Russia., ExxonMobil, which has strong ties to the Bush administration, has invested over $10 billion in the Sakhalin-1 oil and gas fields and expressed interest in building a natural gas pipeline from Sakhalin to Japan. Royal Dutch Shell is in talks with Gazprom and Russian Prime Minister Mikhail Kasyanov about buying out Gazprom’s share in the giant Sakhalin-2 project, promising to invest $8-10 billion. On April 16, British-American conglomerate BP announced it would spend $375 million to raise its stake in Sidanko, which previously went through a bruising bankruptcy, from 10 percent to 25 percent.
Chaos in Venezuela and violence in the Middle East can only make Russia and Eurasia look increasingly attractive for energy investors. Provided they can steer a common course with leaders in neighboring countries - and can preserve financial transparency - Putin and Russian oil companies may boost their country’s influence by skillfully taking advantage of its competitors’ increasing political risk.
03-18-2002
The US government is putting the best face possible on Uzbek President Islam Karimov’s visit to Washington. Officials from the State Department, National Security Council and the Pentagon stress that Karimov promised to improve Uzbekistan’s human rights record, adding that they believe Karimov is sincere in his desire to promote civil society in the Central Asian nation.
Karimov ended his US visit on March 14 with several stops in New York, including a brief visit to the downtown site where the World Trade Center buildings once stood. The same day in Washington, officials gave Karimov’s performance high marks. The Uzbek leader has faced widespread criticism in recent years for a crackdown on basic rights in Uzbekistan. But Bush Administration officials insisted that Karimov recognized domestic rights conditions in Uzbekistan needed to improve. The Uzbek leader also admitted that his government had to relinquish total control over the economy.
"He is not stupid," one US official said. "He delivered a surprisingly intelligent speech to the business community; and his remarks to President Bush were quite sincere - unless he deserves an Oscar for acting."
Some advocates have worried that by stepping up aid to Uzbekistan after joining the war on terrorism, the United States would reward Karimov’s repressive rule. One official, speaking on background, disputed that notion. "He understands that he has a problem with human rights, and he openly said so. He owes the United States his security, if not his survival," the official said. "I don’t think he will string us on and lead us by the nose."
Karimov certainly seemed humbled, according to note-takers, at his meetings with President George W. Bush and Secretary of State Colin Powell. The Uzbek leader repeatedly voiced appreciation for the Americans’ respectful and low-key tone, say government officials with knowledge of the meetings. Karimov gave a clear-cut promise to "improve behavior" in the future.
"If only anyone explained these things to me this way before," Karimov reportedly lamented, "we would be along the way to implement these reforms... These issues are our responsibility. We will follow through on what we signed. I understand that Uzbekistan needs it, not the United States."
US officials said both Bush and Powell stressed to Karimov that without significant improvements on human rights and economic liberalization, the US Congress will not be receptive to further allocations of economic and security assistance.
US officials suggest that Karimov has already moved to fulfill his pledge to improve the country’s democratic climate. Prior to arriving in Washington, the Uzbek government registered a human rights organization, and released over 800 political prisoners from prison. Human rights organizations have praised Karimov’s recent moves, but say they alone do not comprise a liberalization trend.
Karimov’s actions follow a big increase in American aid. In the current supplemental 2002 US assistance budget, Uzbekistan is about to receive over $155 million - $83.5 million above the aid allocated prior to the September 11 attacks. The US Export-Import Bank also inked a fresh $55 million credit facility for small and midsize Uzbek businesses during Karimov’s visit. About one-half the aid total will consist of security assistance, including communications gear for the Uzbek military and programs aimed specifically at improving border patrols. The remaining half of aid would be devoted to a wide variety of socio-economic areas, including programs to combat the spread of HIV/AIDS, the environmental rehabilitation of the Aral Sea basin and improvements in social services in the Ferghana Valley, Central Asia’s agricultural heartland and center of radical Islamic sentiment.
In Washington, Karimov also reached out to the international financial institutions, such as the World Bank and the International Monetary Fund (IMF), after repeatedly snubbing these organizations’ advice for years. The IMF closed its offices in Uzbekistan in 2001, citing frustration over the Karimov government’s reluctance to carry out essential reforms, including the convertibility of the local currency, the som.
The Bush Administration officials who deal with Uzbekistan on a daily basis told EurasiaNet that they understand that they must pursue human rights and political liberties in the name of security. Without security, there will be no investment; but without investment, there will be no economic development. However, they also stressed that in the middle of the war on terrorism, security takes the front seat.
Karimov remains concerned about national security and in Washington held meetings with top defense department officials. Indeed, the centerpiece of his visit was the signing of a Declaration of Strategic Cooperation. The Pentagon has taken a lead in cooperating, training and supplying the Uzbek military. Despite the rumored death of Islamic Movement of Uzbekistan leader Juma Namangani during the anti-terrorism campaign in Afghanistan, Karimov is anxious to keep building the Uzbek military’s capacity.
Even if the IMU cannot reconstitute, Hizb-ut-Tahrir, a radical Islamist party, which advocates the overthrow of Karimov’s regime, could help foment anti-government unrest. The Strategic Cooperation pact includes a promise by Americans to "regard with grave concern any external threat" to the Uzbek government. Hizb-ut-Tahrir already causes grave concern both for the Karimov regime and for the US government, American diplomats stressed.
Because of these concerns, some in the US human rights community recognize that in order to pursue specific liberalization measures, or to get notorious cases of persecution reversed, it may be worthwhile to work through the Pentagon. "The US military has a unique channel of communication with the Karimov regime," says one congressional staff member who is deeply involved in promoting democracy in Uzbekistan.
However, the Pentagon is primarily focused on future geopolitical engagement in Uzbekistan, irrespective of the human rights climate. In their meeting, Karimov and Secretary of Defense Donald Rumsfeld discussed the future of American bases in Central Asia. The US government’s official position is that it does not seek permanent bases in Central Asia. At the same time, officials say they want access to former Soviet facilities for an indefinite period - at least as long as the war on terrorism is continuing. Such a formula is vague enough to keep everyone in the region nervous, but it avoids a direct clash with Russia over regional spheres of influence. In October 2001 Russia requested - and conducted - consultations with the United States over the future of Central Asia. The second round of consultations will take place in Moscow in April.
According to sources present at Karimov’s talks with Bush, Powell and Rumsfeld, the Uzbek ruler’s main worry - and warning - was about Iranian meddling in Afghanistan. Karimov apparently believes that Tehran will try to undermine stability there by exploiting centuries-old ethnic rivalries, in order to undermine the United States and its allies. If that scenario were to materialize, the United States would need to act as a more solicitous friend to players throughout the region, including Karimov himself. As one American diplomat said, "if you thought politics make strange bedfellows, try war - it makes stranger ones."
02-19-2002
Reports that al Qaeda fighters, possibly including Osama bin Laden himself, have found refuge in Georgia are stoking pressure for outside military intervention. Top Russian officials are once again hinting that Moscow may feel compelled to intervene militarily to contain Islamic radicals in Georgia. Georgian President Eduard Shevardnadze is categorically opposed to Russian intervention in the Pankisi Gorge, but he has indicated that he would consider a Georgian-US joint operation.
The top US diplomat in Georgia, Philip Remler, helped focus attention to the brewing crisis in the Pankisi with an announcement that al Qaeda fighters had infiltrated the region. Georgian leaders have not disputed Remler’s assertion.
In recent days, Russian officials have fueled concerns with speculation that bin Laden may be among those on the loose in the Pankisi Gorge - a claim that Georgian officials deny.
Since mid-January Georgian security have attempted to crack down on criminality in the Pankisi area. But the February 17 kidnapping of four Georgian police officers on duty in the region underscores the weakness of the state’s authority.
Russian Defense Minister Sergei Ivanov warned that Georgia’s chaotic conditions warranted the launch of an immediate anti-terror offensive. If Georgia is incapable of conducting such operations, Ivanov hinted the Russian military could take matters into its own hands.
"On the one hand, it is, of course, sovereign Georgia’s business," Ivanov told the Interfax news agency. "On the other, [should we really] sit and wait and see how tensions mount there and how this region is turning into a mini Chechnya, or mini Afghanistan?"
The prospect of Russian intervention clearly does not appeal to Georgian officials. Shevardnadze on February 18 described the idea of a Russian operation in the Pankisi area as "unacceptable."
At the same time, Shevardnadze announced that Tbilisi was considering a joint security operation with the United States. "As for the possibility of a future joint action with the U[nited] S[tates] special forces in the Pankisi Gorge, we haven’t yet had systematic discussions on that," Shevardnadze confessed. "But, if it becomes necessary, we have been and remain ready for dialogue."
In his announcement about the presence of Islamic radicals in Georgia, Remler indicated that Washington was willing to enhance security cooperation with Georgia. The timing of his comments, some analysts believe, may have been designed to forestall a Russian military move in Georgia.
Most regional analysts and policy makers have known that the Pankisi Gorge has served as a haven for Chechen separatists and other Islamic radicals since the first Chechen war (1994-1996). The Chechen fighters and terrorists connected with Afghanistan are allied with the radical Chechen field commanders Shamil Basaev, Ruslan Gelaev and Khattab.
The Kremlin has complained for years that the Shevardnadze government has covered up the Pankisi situation. According to a March 2001 report by the popular Georgian TV channel Rustavi-2, Pankisi has become a supply base to which the Georgian Ministry of State Security has transported Turkish aid to the Chechen separatists. According to the Georgian Minister of State Security Valery Khaburdania, the radical pan-Turkist Grey Wolves were the conduit of assistance to the Chechens.
In the past, Moscow’s complaints about the flow of aid to Chechens via the Pankisi did not draw any reaction from Washington. Senior officials in the US Department of State now say they are facing a dilemma on Pankisi. On the one hand, securing independence and territorial integrity of Georgia is at the top of the US agenda for the Caucasus. On the other hand, improving relations with Russia, especially concerning the conduct of anti-terrorism operations, has become a strategic priority.
According to the Georgian official, Azeri security officials tipped off Georgian authorities about the terrorist penetration. Georgian security officials announced February 9 that two foreigners with apparent ties to Khattab had been arrested.
On July Fourth, President Donald Trump signed the “One Big, Beautiful Bill” into law, introducing significant changes that will dramatically reshape America’s energy landscape. The newly minted OBBB Act leaves businesses and policymakers trying to determine its potential impact on jobs, investment, and the nation’s position in the global energy race.
Read the full article here
Telling the BBC that he is “disappointed but not done with Vladimir Putin,” President Donald Trump has threatened 100% tariffs against Russia, including secondary tariffs against countries that help dodge sanctions on the Kremlin’s energy exports., The U.S. Senate is considering a bill to give the president the ability to impose additional “sledgehammer” measures with up to 500 percent secondary sanctions. Under pressure, Moscow is expanding its hydrocarbon exports by boosting LNG shipments to the Asian markets from Siberia’s Yamal Peninsula. On June 26th, the Russian tanker Iris docked at Arctic LNG 2 terminal, a joint venture between Russia’s Novatek, Chinese CNPC and CNOOC, and Mitsui and JOGMEC, marking the first departure from the sanctioned facility since October 2024.
Read the full article here
For the Trump administration, critical minerals are a global policy priority. President Donald J. Trump is trying to get China to relax bans on rare earth minerals desperately needed for American industries, including defense and tech. From Greenland to Ukraine, the U.S. is signaling interest and engagement, be it intent to acquire or a comprehensive energy and minerals agreement. In Africa, the U.S. brokered a peace agreement between the Democratic Republic of the Congo and Rwanda, amid conflict over critical minerals on the border of the two countries. This presents opportunities for American investment, driven by a global security strategy by from a president who has notably scaled back from U.S. engagement abroad.
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More than 20 years in the making, the Iranian nuclear technology program may have finally hit a brick wall. The Iranian government may not survive the successive blows Israel’s Operation Rising Lion is now delivering. Regardless of the outcome, the implications for global energy and security in the Middle East will undoubtedly be historic.
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Today, disparate Trump policies —more muscular American diplomacy, less soft power, higher tariffs, and the quest for cheap energy — are being tested together in Venezuela. The pro-Russia, pro-China, and pro-Iran far left Maduro regime in Caracas has long been a thorn in the side of the United States in the often-neglected Latin American theater.
The first Trump Administration focused heavily on applying pressure to the country to minimize its benefits from oil exports in the U.S. American economy. Now, early in President Trump’s second term, he is reviving efforts to weaken the Chavista dictatorship by imposing secondary tariffs of 25% on all imports from countries that buy Venezuelan oil, starting on April 2nd. Additionally, on March 29th, the U.S. informed foreign partners of Venezuela’s state-owned oil company, Petroleos de Venezuela (PVDSA), that it plans to revoke authorizations issued by the Biden Administration for them to export Venezuelan oil and byproducts, putting further pressure on Venezuela’s ability to export.
While such measures will have certainly gotten Venezuelan President Nicolás Maduro’s attention, targeting that country’s most profitable industry may be insufficient to implement the president’s agenda.
Read the full article here.
Dr. Ariel Cohen discusses the ceasefire deal between Israel and Hamas, how each party will likely proceed, and theUnited States' involvement in the agreement.
https://youtu.be/izKqUhFdcPo
The 29th annual UN Climate Change Conference begins on November 11th in Baku, Azerbaijan. Many environmentalists are pessimistic about the conference, with the choice of Azerbaijan as the host country, China’s negotiation strategies, and the American election results.
A major Russian military buildup on the border with Ukraine has recently sparked fears of a potentially dramatic escalation in the simmering seven-year conflict between the two countries. Although tensions have eased somewhat following Moscow’s April 22 announcement of troop withdrawals, the threat of a new Russian offensive remains.
