And it worked: Shortly afterwards, the government of Uzbekistan forced the US to leave its base there; now it only has a base in Kyrgyzstan. (However, differences eventually emerged between Russia and China as to how the SCO should be oriented: while Russia wanted a more military-oriented alliance–the group still holds regular joint military exercises, though they’ve grown smaller in recent years–China was more interested in making it a tool for economic integration.)
But the opening of the Turkmenistan-China pipeline has changed the game, and has established China as a true player in the region, to the likely detriment of both Russian and US energy interests.
The focus of US energy policy in the region is getting natural gas to Europe from the Caspian Sea region without going through Russia. While the United States wouldn’t get any of the Caspian gas itself, its aim is to break the monopoly that Russia has over the natural gas market in many European countries, especially former Warsaw Pact countries like Bulgaria and Romania that are most vulnerable to Russian pressure and also some of the most loyal US allies in Europe. The danger of that monopoly has been illustrated over several recent winters when Russia cut off gas supplies to Europe–ostensibly over pricing disputes, but targeting political nemeses like Ukraine.
To that end, a US-backed pipeline transporting gas from Baku, on the Caspian Sea coast, to eastern Turkey, went online in 2006. And the United States is now attempting to put its weight behind another pipeline project, either the Nabucco pipeline (which would take gas from Turkey to Austria) or the so-called Interconnector Turkey-Greece-Italy.
But no one will build such a pipeline, no matter how strong the political support from Washington, if it won’t make money. And the question about these pipelines is, where would the gas come from? Azerbaijan has pledged some gas from the Caspian Sea, but the amount it could provide would not be enough to make the pipeline worth building. Iran–which has the second-largest gas reserves on Earth–has offered to take part. Turkey supports that, but it is of course not palatable to the Americans. Iraq is a possibility, but by far the most tempting options are from Central Asia: Kazakhstan and, especially, Turkmenistan.
Turkmenistan’s known gas reserves are in the top five in the world, with the possibility of even greater discoveries to come. But no one is sure if it has enough gas to supply both China and the West, not to mention Russia (where Turkmenistan exported 70 percent of its gas until the Chinese pipeline started up) and Iran (with whom it also inaugurated a pipeline in December).
The Chinese pipeline could hurt Russia’s monopoly position in Europe if it siphons off so much gas that Russia doesn’t have enough to supply its European customers. But it could also thwart US plans. Turkmenistan’s government says that it will have enough gas to ship some across the Caspian to Europe, in addition to supplying Russia, China and Iran, with whom it also inaugurated a new pipeline project in December. But it’s not yet clear if that’s true. And US officials have publicly acknowledged that China has made their bargaining position weaker: ‘It’s hard for us to compete with China in some of these countries, particularly countries that are a little more insular,’ said Richard Morningstar, the Obama administration’s Eurasian energy envoy, at a congressional hearing last year. ‘It’s easy for Turkmenistan to make a deal with China, when China can come in and say, “Hey, we’re going to write a check for X amount of money, and we’re going to build a pipeline, and furthermore we’re going to lend you money so that you can explore, and we will be paid back in gas that you, ultimately, deliver to us.” You know, that’s not a hard deal to accept. And we can’t compete in that way.’
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Ebag Xor
With no threat of occupation and subsequent forced export of their resources, these oil-rich nations are clearly in the driver seat. They cannot be threatened with invasion, or blatant domestic tinkering, and thus cannot be strong-armed by great powers that cannot live without their resources. Obviously these autocrats need to sell their oil to maintain their wealth and power, but with multiple markets available, they can for the first time get real market value. And they said autocratic government couldn’t survive globalization…