So with the ongoing war in Georgia, it is important to figure out how all of this impacts the world and what are the prime motivations of Russia. It is clear to me now that Russia had no intention of sticking with just protecting rebels in Georgia. I think the overall motivation was to take control of Georgia and the pipelines running through it and to keep Georgia out of NATO. And I think Russia has done that. I do not see NATO or the US going in to fight off Russia and stopping their plans of controlling Georgia either.
But back to the impact of all of this. So far the oil markets have not reacted too severely. The BTC pipeline pumps about a million barrels a day to the west and so far the only damage to the pipeline has been in Turkey by the PKK(is there a connection?). But in Georgia, I think Russia has no intention of damaging this cash cow that they are trying to seize. So with this said, I believe if that this conflict becomes protracted, then you will see a constant attack on this pipeline by Georgian forces. The idea being that if the oil means so much to Russia, then that is how you hurt Russia.
The other impact of this is that if there is instability with the Caspian Sea related oil supplies, then other supply sources will become more important to the West. Most importantly, who will Europe turn to for oil in the future? Will they deal with Russia, who would have a control on price and supply coming from this region, or will Europe look elsewhere? I almost think Europe has to deal with Russia more than ever, until infrastructure and other oil deals and sources are found and secured. Like the articles talk about below, the west was depending on this pipeline as a way to bypass dealing with Russia. And given the fact that Europe is already hurting bad with fuel costs, and the coming winter heating costs, this could be bad for them.
And with the other break away republics looking on, I think they are extremely nervous that they will be next in the coming years. Which leads you to think, when will NATO and the west eventually have to step in? Or will we? What is the message that the West is sending to these republics, by doing nothing? We supported their democracies and breaking away from mother Russia, but now, what faith would they have in us when we stand by and do nothing while Russia violently takes over Georgia? And do we want to risk an all out war with Russia over such a thing?
To me, it always boils down to oil, and any threats to that oil supply will dictate our actions. That is the reality. With these countries that have oil or have a pipeline, we will always do what we can to protect them and insure that they do business with us and keep that flow going. I look at oil, as the life blood of the world, and it is absolutely essential to secure supplies for our thriving economies. There is no alternative right now, that will even come close to replacing oil. Biodiesel, ethanol, all of it will not be able to replace oil in the time frame that we need it too. Until some incredible advancements in science is able to turn water into oil or something, we are stuck playing the Great Energy Game. Just my thoughts on the matter, and I think Russia is thinking the same way too.
And with Russia controlling a larger percent of that oil, now that they have control of Georgia, then that gives them more power at the negotiating tables of the world. To me, that is what is really at stake. And Russia wants to make a lot of money and they want more power and influence. So with that said, the economic landscape has just changed with Russia’s latest move and only time will tell how Russia wields their increased influence in the region. –Head Jundi
Photo from the movie “There Will Be Blood”
Georgia: Russians close off strategic Georgian port
Deal to transform Black Sea port of Poti could lie in ruins as Russians seal off access
By Christopher Hope
Last Updated: 6:21PM BST 11 Aug 2008
Just five months ago, Georgia’s President Mikhail Saakashvili was touting a $70million deal which he hoped would transform the Black Sea port of Poti, creating 20,000 jobs over the next five years.
Under the deal Arab investors were set to plough $200million into developing a new port alongside the existing commercial port, trebling Poti’s capacity to 25 million tonnes of cargo a year.