Pipeline politics in the Caspian Sea Basin

Abstract

The growing significance of the Caspian region in international politics and economy is because of its geostrategic location and the huge oil and gas reserves in the area. The extraction and transportation of oil and gas from the region has emerged as a major source of geopolitical rivalry. The proposed pipeline routes of numerous companies of the extraregional powers are intended to contain the influence of the region's two powerful countries—Russia and Iran. These powers are seeking to increase their influence in the region by providing alternative energy supply routes to the producing countries—all of them former Soviet republics—so as to reduce their dependence on Russia. However, Russia on the other hand, is keen to maintain its strategic interests in the Caspian region and would like the bulk of the pipelines to pass through it. Similarly, Iran is interested that the pipelines pass through its own territory. The crux of the entire geopolitical rivalry is the uninterrupted flow of oil and gas from the region to the Western energy markets by restricting Russian and Iranian control on the oil and gas exploration, development and pipeline routes. The winners in the struggle over pipeline routes are likely to secure major strategic advantages, while the losers would be marginalised in the coming years. The latest crisis in Afghanistan seems to have altered the equations in the region. Russia's cooperation with the US and the West in the war against terrorist groups and the Taliban in Afghanistan has increased its role and importance in the region. Will the US accept a major Russian role in transporting oil and gas from the region and ensuring regional security? With the US expanding its presence in the region and its military involvement in Afghanistan, it is poised to consolidate its base of influence in the Caspian region. Russia's and Iran's roles in the region would then be inevitably affected.