Sunday, May 17, 2009

Nabucco moves forward?

This is interesting news and a surprise (at least to me). The pipeline would not be finished until 2014 at the earliest, but the biggest question was who would be willing to fill it. None of the Central Asian countries would likely consider agreeing to do so at this time for several reasons, it seems. The first is that they would be unwilling to irritate Russia as the pipeline is specifically designed to avoid Russia and lessen European dependence on Russian gas transit and supplies. The second reason is that it is a long way to go - crossing Iran and the mountains to Turkey - while the Caspian is a huge barrier to piping gas from Central Asia.

From a geopolitical standpoint, this announcement must be a blow to Baku which has watched Turkish negotiations with Armenia with some degree of concern. Nabucco crossing the Caspian would have needed to cross Azerbaijan, giving it some degree of leverage with Turkey and Turkey has been very cautious in dealing with Russia which is calling the shots in the South Caucuses. Iraq eliminates that problem for Turkey and gives it more room to maneuver with Azerbaijan, Armenia and Russia.

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