Geopolitical Conundrums

Oil: A Geopolitical Conundrum

The Russians therefore view their close economic and military ties with Iran as strategically critical. The Iranian relationship enables Russia to exert influence in Central Asia with greater ease, without a major US ally in the picture, except Turkey. With the current state of Russo-Iranian military and energy ties, Russia stands a chance to challenge the US in the heart of the Middle East, and together with China in the SCO, present a new global energy block.

However, Turkey, under the semi-pro-Islamic government of Prime Minister Recep Tayyip Erdogan, has forged close economic and diplomatic ties with Tehran, particularly in the field of energy. For Turkey, therefore, an Iran in chaos is a nightmare. Policy makers in Moscow — very much similar to their global and regional counterparts in Beijing and Ankara — would consider a Western-led attack on Iran to be a direct assault on their national geo-energy interests.

One can imagine what the implications of such an attack would be were Iran granted full accession to the SCO. The 64,dollar question re-emerges: Will Iran be engulfed in a military confrontation with the West; and should this come to pass, who will be dragged into it? One thing is clear: Not only will political lives be on the line, but also the actual lives of thousands of ordinary people stretching from Tel Aviv to Tehran.

A Geopolitical Conundrum Last updated Sep 3, Prev Post The Coup against Mazdakite. Large oil producers who base their country's economy on oil, such as Russia and Venezuela, are facing dire economic outlooks.

The drop in prices are a boon to importing countries like Japan, who is currently suffering from a weak economy. Arguably the biggest business headline during the past few months has been the sharp decline in oil prices worldwide. So what exactly has caused such a big drop in oil prices? American shale oil, Saudi resistance to forfeiting market share, a decrease in consumption by the slowing down of the Chinese economy, as well as the economic stagnation in Europe, are arguably the largest factors in the recent decline of oil prices worldwide.

What comes as a gain to consumers, and large consuming countries such as Japan and India, comes as a loss to producers, such as Russia and Venezuela. The United States have recently taken over Saudi Arabia as the world's largest oil producer. American shale oil only accounted for 0.

Commentary: Geopolitical conundrum

This rise in production has been good news for North Dakota and Texas, with workers flocking to shale sites such as the Bakken formation and Eagle Ford, and in general for America, which has seen its economy strengthen recently. Despite its environmental concerns- oil and gas are extracted from deep rocks underground by wrecking them with a mix of water, chemicals and sand, a process called fracking, which was recently banned by the state of New York - the shale oil industry is taking off in a large way.

However, the recent drop in oil prices has hampered the growth of the industry. This inertia by American oil production has caused the Organization of the Petroleum Exporting Countries OPEC to not budge, stating that they will not intervene and reduce production. The country is caught in between Iran, Russia and the West and finding a way to meet the needs of all of them is going to be extremely difficult, says Elkhan Nuriyev. Its attempts to preserve its freedom to manoeuvre are akin to a tricky political dance on a tight-rope: Azerbaijan is an energy-rich nation, so the orientation of its foreign policy is an important reference point for the processes of state-building and democratisation, which may or may not find support among the elites and ordinary citizens.

The geopolitical impact of the Arab Spring has meant that Iran, the US and other Western democracies, and Russia keep a close watch on current developments in and around Azerbaijan. In a rapidly changing regional security environment, Tehran, Washington and Moscow are concerned with what might happen in this Caspian littoral state in future. They have tried to dissuade them from certain foreign policy conduct or to convince them to act in a manner consistent with great-power interests.

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Washington and other Western capitals have on several occasions urged Baku to change its domestic politics so as to promote genuine democratic reform, freedom of speech and protection of human rights; Tehran and Moscow have always sought to gain greater political and economic influence in Azerbaijan. Paradoxically, during recent months Iranian-Azerbaijani relations have reached unprecedented levels of tension.

Azerbaijan has just recalled its ambassador from Iran for consultations, mirroring the action Iran took some weeks ago.

Azerbaijan: the geopolitical conundrum

The town of Shusha in the disputed region of Nagorno-Karabakh, an Armenian enclave in Azerbaijan under Armenian control since The town was virtually destroyed during the military conflict between the two countries, but little has been done to rebuild it. Tehran has repeatedly accused Baku of expanding cooperation with the US and Israel, and consolidating Western strategic presence in the South Caucasus-Caspian basin. Tehran strongly believes that a politically independent, pro-Western and petroleum-producing neighbour could enter into competition with the Iranian state. Azerbaijan has indeed been significantly affected by the ideology of the Iranian-trained clerics, since Tehran has consistently exploited any unrest to strengthen its political weight there.

As a result, Baku and Tehran struggle to find a language of mutual understanding but have as yet to reach political consensus on many geopolitical issues in the regional context. In reality, Tehran seeks to prevent the emergence of a strong and wealthy Azerbaijan that would act as a magnet for Azerbaijanis living in communities in the northern part of Iran.

The large Azeri minority is a growing concern to the Iranian leadership, as Tehran fears increased nationalism among Azerbaijanis could threaten the integrity of the Islamic Republic. If Russia considers the problem of an independent Azerbaijan as one of the elements in a complex of South Caucasus sovereign states, for Iran this problem assumes a somewhat different political form.

The very existence of Azerbaijan, even as a purely formal independent state, is quite definitely and not unjustifiably perceived as a real threat to the national security of the Islamic Republic. In other words, the presence of over twenty million Azerbaijanis residing in Iran is the spark which could ignite the fragile powder keg that is the multinational structure of the Iranian state. For that reason, it is not surprising that the interests of Iran could best be served by the simple absorption of Azerbaijan into Russia.

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Moscow too has a vital interest in undermining American hegemony in the South Caucasus and in restricting the westward orientation of her post-Soviet neighbours. Russia continues to carve out an important political and economic role for itself in Azerbaijan and is actively but subtly competing for influence in her backyard.

Iran: A Geopolitical Conundrum

The Azerbaijani leadership is still opposed to any further encroachment of Russian influence in the region and has therefore been actively lobbying for Western engagement. Great-power ambitions are increasingly manifested in the desire of the Russian leadership to run the geopolitical show in the South Caucasus and Central Asia. This might even become a reality if the military option against Iran is put into operation.