Posted on 06/08/2006 6:26:31 PM PDT by blam
US bypasses Russia with BP pipeline
By Adrian Blomfield in Moscow
(Filed: 09/06/2006)
Washington scored a significant victory in its contest with Moscow for influence in Central Asia yesterday when Kazakhstan agreed to start pumping oil to the West through a British Petroleum pipeline that bypasses Russia and Iran.
The deal, secured largely because of a personal visit to Kazakhstan last month by Dick Cheney, the United States vice-president, will infuriate the Kremlin.
But there will be secret relief in European capitals, where there is growing concern over Russia's apparent willingness to use its vast energy supplies as a political weapon.
Nursultan Nazarbayev, the Kazakh president, told an investors' conference in the capital, Almaty, that a formal agreement would be signed next week to begin delivery through an existing BP pipeline that connects Azerbaijan to the Turkish coast.
This loops through Georgia, thus avoiding Russia to the north and Iran to the south.
The deal will give the West greater access to the vast oil fields of the Caspian Sea - estimated to hold the world's third-largest reserves - and ease its growing dependence on energy from Russia and the Middle East.
America and Russia are locked in fierce competition for access to Central Asia's vast energy wealth.
Russia has emerged as the world's second largest oil producer after Saudi Arabia, a fact that has allowed the Kremlin to recover some of its Cold War swagger.
Mr Cheney, a former oil man who for more than 20 years has highlighted the importance of the Caspian Sea, has grown increasingly sceptical of Russia's intentions towards the West.
He launched a scathing attack on the Kremlin last month and caused outrage by flying to Kazakhstan immediately afterwards, where he was fulsome in his praise for Mr Nazarbayev's even more democratically dubious regime.
President Ilham Aliyev of Azerbaijan, the other major oil-producing country on the Caspian to sign an energy deal with the West, was recently entertained at the White House - though he too has been accused of cheating in an election last year.
The new deal could help to bring down world oil prices, another factor likely to upset Russia, whose energy-dependent economy could wobble if crude falls below $50 a barrel.
Kazakhstan has become a serious rival to Russia as a hydrocarbon exporter.
But Mr Nazarbayev is in a tricky situation.
The financial benefits of a US deal may be tempting but must be set against his country's geographical vulnerability to its powerful neighbours Russia and China, neither of whom is keen on his flirtation with the West.
The president sought to alleviate concerns in the Kremlin with an assurance that the bulk of Kazakh oil would still be transported through Russia.
Reagan warned of the threat of Russian petro monopoly and thank God 20 years later, another Repub has sone something about it.
This is good news. Too bad the MSM won't report it.
Think gas, not oil. Per CIA factbook their known proven reserves cover about 20 years of oil [and 80 yrs of gas] extraction at current levels. This gives a ballpark timeframe.
Bush's fault. (though the MSM and the 'Rats won't give him credit)
Great news but we still need to do our own drilling and supplying ourselves. We need to update and build refineries. We are putting ourselves in a very dangerous place in future years by not doing this.
Good news
Putin the his Kremlin energy mafia are going to be pissed.
"This loops through Georgia"
That should have Putins panties in a bunch.
Should I say it? "Cheney will make millions on this deal."
Ouch...Putin needs to put some ice on that.
Now Dick, tell Putin we'll bomb Iran if we feel like it.
ping
This is good news; it means that Putin's attempts to nationalize the Russian oil industry will have less of an effect on oil prices in the West. It would be quite unfortunate for Americans to have to pay more for their oil because Russian oil production reverted to the inefficiency of government control.
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