9/2/08

The Energy Pipeline Guardians: NATO, SCO

US Vice President Dick Cheney begins a trip to Georgia, Ukraine and Azerbaijan, a move that is likely to irritate leaders in Moscow, who have condemned the United States for siding with Georgia in the South Ossetian conflict.

It is not yet clear to what extent will Cheney push to get Georgia and Ukraine into NATO. At recent NATO summits, Washington sought to commit NATO to energy security activities. This means NATO members would risk being drawn into long-term military commitments relating to energy.

The Shanghai Cooperation Organization (SCO) was formed in 2001 as a counterweight to NATO’s growing influence in the region, dubbed the anti-NATO alliance by the Russian press. Iranian President Mahmoud Ahmadinejad whose country holds observer status in the club and holds enormous oil and gas reserves, attended the SCO summit.

Washington has long hoped that the energy-rich Caspian region would help reduce Iran’s role in the global oil market, diversify supplies away from Russia, and provide an alternative to Saudi Arabian oil.

The reliability of Georgia as an energy transit country was dealt a devastating blow following the recent conflict. Oil and gas analyst Konstantin Batunin says, “Georgia might be seen in the eyes of some potential investor as not a reliable partner because it was involved in military action first, and second, several pipelines, which are going through the territory of this little state, were shut down simultaneously. This is a major concern, whether the country is reliable enough to invest in its infrastructure.”

[Excerpt of an article by Kostis Geropoulos, New Europe News]

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