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Caspian: Doubts Raised Over U.S.-Russian Cooperation

Analysts are wary about predictions that Russia and the United States will become allies in developing Caspian resources as a result of the war on terrorism. So far, the two countries still seem committed to pursuing previous policies.

Boston, 23 October 2001 (RFE/RL) -- Oil experts have voiced doubts about reports that Russia will become an ally of the United States in tapping the resources of the Caspian and Central Asian regions.

The "New York Times" recently reported that "Russia is stepping forward as a new friend in need" by offering its oil as an alternative to Persian Gulf supplies during the current security crisis.

The article said that "instead of squabbling over the routes exports would take, the two sides now share a common interest in ramping up total pipeline capacity."

The paper also quoted analysts as saying that the new U.S.-Russian alliance against terrorism "has accelerated the shift away from antagonism over the vast oil resources of the former Soviet Union." The report said that rivalry in the Caspian "could now turn into something more like cooperation."

But analysts contacted by RFE/RL were either unsure or skeptical about the idea that the Caspian pipeline policies of the two countries will change quickly or dramatically as a result of the war on terrorism.

Caspian export routes and strategic goals that have been developed over a period of years are unlikely to be transformed in the six weeks since 11 September, they said.

Robert Ebel, director of the energy and national security program at the Center for Strategic and International Studies in Washington, said, "Both countries are going to act in their own national interests."

"Things are friendly right now," Ebel said. But he added that the Caspian policies of the two countries remain at odds, saying, "We're still working to minimize the flow of oil through Russia and to prevent the flow through Iran. As far as I know, that hasn't changed."

In the past month, President Vladimir Putin and other Russian officials have indeed offered the country's oil production to the West to replace Persian Gulf sources, if they are threatened.

But Russia has been pursuing a policy of maximizing its oil exports for the past two years, taking advantage of oil prices that have been buoyed by OPEC cuts. At the same time, it has repeatedly assured OPEC that it will cooperate with its policy of curtailing exports.

In the first eight months of 2001, Russian exports of crude oil rose 7 percent and exports of oil products jumped 20 percent, while OPEC countries have cut their output quotas by 3.5 million barrels per day. Russia's increases have been seen as efforts to help itself, rather than either OPEC or the West.

At a press conference on 21 October in Shanghai with President Vladimir Putin, U.S. President George W. Bush cited progress on the question of missile defense, which has been a source of tension between the leaders since Bush took office in January. But he referred only in passing to the energy issue, noting simply that "Russia is a land of vast natural resources." Putin did not address the matter in his remarks.

Julia Nanay, director of Petroleum Finance Company, a Washington-based consulting firm, said it may be two or three months before it becomes clear whether U.S.-Russian cooperation on oil will materialize.

Nanay said, "For me, it's still a big question how do we cooperate."

One major problem is that Moscow and Washington have been promoting two different pipeline routes from the offshore oilfields of Azerbaijan.

Russian officials have been saying since last May that the government would stop opposing the U.S.-backed route from Baku to Turkey's Mediterranean port of Ceyhan and would even allow Russian companies to compete for construction contracts on the pipeline.

But the officials have continued to make the case that the project will not be economic. Instead, they have pushed Russia's route from Baku to the port of Novorossiisk on the Black Sea.

Turkey objects to that line on the grounds that it will add to oil traffic through the Bosporus, while U.S. officials have argued that the Caspian countries should not depend solely on Russian routes.

So far, there are few signs of a change in the two country's pipeline strategies, which have persisted for the past seven years.

"The New York Times" also seemed more cautious on 21 October about predicting that the latest improvement in relations would lead to changes in a wide range of policies, such as energy. In a report on moves toward an alliance, the paper wrote that, "American benefits from the new closeness to Russia are limited mostly to what Mr. Putin has promised." The issues included only access to Russian airspace for relief missions and other matters related to the conflict in Afghanistan.