(no subject)
PART THREE -- THE BEAR'S BLUE FLAME (part one is here and part two is here)
So, why are Russia and the United States so het up over little Georgia (and littler South Ossetia)? It isn't just altruism. You may find this shocking, but there are oil and gas interests involved!
The first thing to understand is, Russia has more natural gas than any other nation on Earth.
Russia's part of the pie is green -- they have 17% of the world's supply, the bulk of which lies in Siberia.
Its vast resources are run by the state-run "Gazprom," third-biggest company in the known universe. Gazprom has 300,000+ employees spread across eleven time zones*, and its market value is expected to surpass $1 TRILLION/year in 2017. Take that, Coca-Cola! Stick it, GE!
Natural gas is best delivered via pipeline. And Gazprom delivers -- all over Europe.
we depend on you, russia
Which sounds fine, EXCEPT: some people think that Gazprom uses its monopoly power to enforce Russia's foreign policies. AKA, aggravate the Kremlin, and you're going to be taking icy showers and cooking over an impromptu campfire.
Georgia, for instance, talked about joining NATO in 2001 and suddenly found itself gas-free[1]; more recently, the Georgian president's anti-Kremlin rhetoric has been juxtaposed with mysterious gas outages and doubling prices.
don't taunt the bear.
More significant than Georgia and Russia's gas skirmishes, though, was Gazprom's 2006 showdown with Ukraine. In March of 2005, shortly after Ukraine installed the pro-Western Viktor Yuschenko in its "Orange Revolution," the nation found its gas prices near-quintupled**. Ukraine refused to pay, so in January 2006 Russia cut them off. It was the dead of winter.
But look @ the route below -- the pipeline that serves Ukraine also serves Germany, Austria, Italy, Slovenia, Slovakia, & more! So when the Russians cut Ukraine off, the Ukrainians began to siphon gas intended for other countries. Everyone felt...cold.
Everyone also felt nervous and cranky. Westerners (and ex-Soviet nations) felt that Russia was prone to "blackmail" with gas; Russians felt that Ukraine was prone to "blackmail" with its pipes. Did this spur diplomacy, attempts at compromise and mutual understanding? NO! It spurred proposals for MORE PIPELINES.
Russia proposes to built the "North Stream" pipeline, which would serve Western Europe without passing through sneaky old Ukraine.
gazprom dreams of a ukraine-free pipeline
And Western European countries are proposing the "Nabucco" pipeline, which would transport Central Asian gas to Europe via a southern route, cutting Russia and Gazprom out of the picture altogether.
Do you know where Nabucco is supposed to pass through?
That's right -- Georgia!
western nations dream of a russia-free pipeline
Coming in part four: Georgia is a transit corridor for oil, too-- there's petrol in them thar mountains.
Notes
*Its most famous employee is its ex-president, Dmitry Medvedev (now better known as the president of Russia itself).
**To be fair, Gazprom sells to former USSR countries at WAY below market rate.
[1] A fascinating account of this can be found in The New Cold War, by Mark Mackinnon. Which is, in general, a geopolitical thriller -- it seriously reads like a novel.
So, why are Russia and the United States so het up over little Georgia (and littler South Ossetia)? It isn't just altruism. You may find this shocking, but there are oil and gas interests involved!
The first thing to understand is, Russia has more natural gas than any other nation on Earth.
Russia's part of the pie is green -- they have 17% of the world's supply, the bulk of which lies in Siberia.
Its vast resources are run by the state-run "Gazprom," third-biggest company in the known universe. Gazprom has 300,000+ employees spread across eleven time zones*, and its market value is expected to surpass $1 TRILLION/year in 2017. Take that, Coca-Cola! Stick it, GE!
Natural gas is best delivered via pipeline. And Gazprom delivers -- all over Europe.
we depend on you, russia
Which sounds fine, EXCEPT: some people think that Gazprom uses its monopoly power to enforce Russia's foreign policies. AKA, aggravate the Kremlin, and you're going to be taking icy showers and cooking over an impromptu campfire.
Georgia, for instance, talked about joining NATO in 2001 and suddenly found itself gas-free[1]; more recently, the Georgian president's anti-Kremlin rhetoric has been juxtaposed with mysterious gas outages and doubling prices.
don't taunt the bear.
More significant than Georgia and Russia's gas skirmishes, though, was Gazprom's 2006 showdown with Ukraine. In March of 2005, shortly after Ukraine installed the pro-Western Viktor Yuschenko in its "Orange Revolution," the nation found its gas prices near-quintupled**. Ukraine refused to pay, so in January 2006 Russia cut them off. It was the dead of winter.
But look @ the route below -- the pipeline that serves Ukraine also serves Germany, Austria, Italy, Slovenia, Slovakia, & more! So when the Russians cut Ukraine off, the Ukrainians began to siphon gas intended for other countries. Everyone felt...cold.
Everyone also felt nervous and cranky. Westerners (and ex-Soviet nations) felt that Russia was prone to "blackmail" with gas; Russians felt that Ukraine was prone to "blackmail" with its pipes. Did this spur diplomacy, attempts at compromise and mutual understanding? NO! It spurred proposals for MORE PIPELINES.
Russia proposes to built the "North Stream" pipeline, which would serve Western Europe without passing through sneaky old Ukraine.
gazprom dreams of a ukraine-free pipeline
And Western European countries are proposing the "Nabucco" pipeline, which would transport Central Asian gas to Europe via a southern route, cutting Russia and Gazprom out of the picture altogether.
Do you know where Nabucco is supposed to pass through?
That's right -- Georgia!
western nations dream of a russia-free pipeline
Coming in part four: Georgia is a transit corridor for oil, too-- there's petrol in them thar mountains.
Notes
*Its most famous employee is its ex-president, Dmitry Medvedev (now better known as the president of Russia itself).
**To be fair, Gazprom sells to former USSR countries at WAY below market rate.
[1] A fascinating account of this can be found in The New Cold War, by Mark Mackinnon. Which is, in general, a geopolitical thriller -- it seriously reads like a novel.