How the West is losing the energy cold war

Picture yourself as the autocratic leader of a small-ish former Soviet republic, bubbling with oil and gas and keen to sell it. But where? One route is old, cheap and easy. It leads north, to Russia. But memories of the Kremlin’s imperial embrace are still fresh. The other is new, costly and tricky. It goes west, in both senses – via your neighbour, Georgia, and to supply Western customers direct.

Azerbaijan, a country of 8 million people on the Caspian Sea, plumped for the western route. After all, America was the strongest country in the world and Russia – back in the 1990s – was weak. So Azerbaijan supported the building of a $4 billion, 1,000-mile-long, million-barrels-a-day oil pipeline from Baku, its capital, via Tbilisi, in Georgia, to Ceyhan, a port on Turkey’s southern coast. BTC, as it is known, is the only oil pipeline from the former Soviet Union not controlled by the Kremlin.

Azerbaijan also supported the Baku-Tbilisi-Erzurum gas pipeline into eastern Turkey. Europe, with US backing, wants to extend it all the way to Austria. That project is named Nabucco – an operatic touch that underlines its importance in saving Europe from energy slavery.

Now not only is that plan in tatters but much else besides. As the shock waves from Russia’s dismemberment of Georgia echo across the region, Western interests are toppling like dominos. Almost unnoticed in Britain, Dick Cheney, the US Vice-President, paid a near-disastrous visit to Azerbaijan last week. Its President, Ilham Aliyev, inflicted a series of public snubs, including phoning the Russian President, Dmitri Medvedev, the moment that a meeting with Mr Cheney finished. A disgruntled Mr Cheney apparently then failed to appear at an official banquet. Azerbaijan seems to be ruling out supplying gas to Nabucco.

Times Online