SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?


To: KyrosL who wrote (10278)10/20/2006 1:56:11 AM
From: elmatador  Read Replies (1) | Respond to of 217818
 
The Collapse of the Euroasian Nigeria. As the project of the energy super power has fallen through, Russia is now in search for a new integration strategy
The Unlucky City
Germany, though much beloved by Vladimir Putin, has always been a land of failures for him. In 1990 after a series of slips during contacts with the locals, Vladimir Putin was recalled back from the House of Soviet Culture in Dresden and sent to the degradingly low (for the 38-year-old lieutenant colonel) post of the aide of the deputy chair of the Leningrad State University. The Soviet career of the officer got derailed. As the famous First Person book says, Putin had to earn on the side as a driver then, as if waiting for a place at Anatoly Sobchak’s staff.
16 years later, another career of Vladimir Putin finished in the same Dresden – that of the energy emperor. German Chancellor Angela Merkel turned down Gazprom’s services of an exclusive supplier and demanded that the Russian partner do the well-nigh impossible – keep to the Energy Charter which guarantees free fuel transit via Russia.

Could this outcome be predicted? Surely, it could. Back in late 2005 when Russia officially proclaimed a new doctrine of the energy empire (or, rather, the Euroasian Nigeria, the natural resources province of developed countries) many experts noted that the European Union and the United States would never agree to complete dependence on the sole energy supplier. Quite on the contrary, the louder energy imperial anthems will be clamoring, the faster consumer will be diversifying supplies of natural resources. In these conditions, an idea of a mighty cartel of consumers which will be pushing on the breakaway resources province will become more real.

This was what Putin finally heard on October 12.

Mutual Chinese Warnings

Meanwhile, the Kremlin has been receiving clear sobering signals throughout last year.

The West has taken Nursultan Nazarbaev in its woolen arms, having clearly forgotten about the Giffen Gate bribery case involving oil contracts with foreign companies and other scandals around the Kazakh leader. The Baku-Tbilisi-Ceyhan oil pipeline was officially put into operation. On June 26, European Energy Commissioner Andris Piebalgs and foreign ministers of Turkey, Bulgaria, Romania, Hungary and Austria signed documents on the Nabucco project in Brussels. The project involves the construction of a new pipeline that the European Union is set to spend $5.8 billion on. The pipeline will be sending Turkmen, Kazakh, Azeri and Russian gas via Georgia and Turkey, bypassing Russia.

Furthermore, Ukraine’s Kremlin-loyal Prime Minister Viktor Yanukovich called on Poland, Azerbaijan and Kazakhstan in September to muster all their energy and complete the construction of the Odessa-Brody-Plock pipeline. Finally, on October 9, two days before Vladimir Putin’s landmark German visit, Astana hosted a meeting of the EU’s representatives in the Central Asia. The delegates pledged willingness of the EU to support the construction of a new trans-Caspian pipeline to improve the access of European consumers to Central Asian fuel.

But the Kremlin, as if lulled by its own propaganda, would not notice the obvious. Instead, Putin tried hard to bluff, promising to re-direct its resources flows to China in case the West is not ready to launch a long-term romance with the energy empire. The West, however, had learnt how to recognize the motivation of the Russian president. They know that after 2008 he is going to live and thrive, but not in Shanghai. That is why Putin’s Chinese Warnings should not be taken in earnest, they think.

Russia’s ruling elite now has some time to mull over right answers for old vexed questions. For instance, the question: “Why should Russian subsidy economies of CIS countries, granting them privileged gas prices?” The answer is clear: this should be done to get post-Soviet nations back into its influence zone, keeping them away form direct agreements with the United States and the European Union on key issues – energy and non-energy ones. The Kremlin has given up this crucial leverage voluntarily and eagerly but without a clue of what it was doing. Now Moscow has to reap the consequences.

The actual outcome of gas wars with Ukraine, Belarus and Moldova in 2005-2006 has become obvious for general public. These all-out and senseless wars have frightened Europe and turned Moscow’s recent mates in the CIS away from any notion of creating a cartel with Putin’s hysterical Russia.

Ups and Downs

The project of the Euroasian Nigeria has fallen through after all. Is it good or bad?

It is definitely bad for the ruling elite of the present-day Russia. Representatives of this elite have considered the status of the exclusive gas supplier as a guarantee of personal and property legalization (which means, immunity) in the NATO space. Now they are in a hurry to devise a new philosophy and technology for legalization.

On the other hand, this failure is positive for Russia in general. A spectacular collapse of the energy doctrine will make this country remember that it does not live only on natural resources. There is also the military industrial complex, science, education and unique culture to rely on. There is also a strong belief that we need give a priority to high technology, but not pin all our hopes on the eternity of Shtokman underground reserves.

Russia will be able to go back to an idea of another empire – a regional empire which is strong not only thanks to God-given natural gas and the rusty gas valve, but also because of the ability and readiness to create political, intellectual and moral role models for the surrounding world. The collapse of Putin’s project will become a strong incentive for the democratization of the country and the drastic change of elites. Therefore, we give the name of the Day of Russian Victory to the nice Thursday, October 12 when Angela Merkel mortally offended Vladimir Putin.

The only thing is not as yet clear. What will the Russian president be doing after 18 ½ months of his ruling? The favourite toy has been broken, and there is no urge or efforts to invent a new one. Perhaps, Vladimir Putin should once again consider stepping down earlier. It would very professional and spectacular.