China pivot fuels Eurasian century By Pepe Escobar

China pivot fuels Eurasian century By Pepe Escobar A specter is haunting Washington, an unnerving vision of a Sino-Russian alliance wedded to an expansive symbiosis of trade and commerce across much of the Eurasian land mass - at the expense of the United States. And no wonder Washington is anxious. That alliance is already a done deal in a variety of ways: through the BRICS group of emerging powers (Brazil, Russia, India, China, and South Africa); at the Shanghai Cooperation Organization, the Asian counterweight to the North Atlantic Treaty Organization; inside the Group of 20; and via the 120-member-nation Non-Aligned Movement (NAM). Trade and commerce are just part of the future bargain. Synergies in the development of new military technologies beckon as well. After Russia's Star Wars-style, ultra-sophisticated S-500 air defense anti-missile system comes online in 2018, Beijing is sure to want a version of it. Meanwhile, Russia is about to sell dozens of state-of-the-art Sukhoi Su-35 jet fighters to the Chinese as Beijing and Moscow move to seal an aviation-industrial partnership. This week should provide the first real fireworks in the celebration of a new Eurasian century-in-the-making when Russian President Vladimir Putin drops in on Chinese President Xi Jinping in Beijing. You remember "Pipelineistan," all those crucial oil and gas pipelines crisscrossing Eurasia that make up the true circulatory system for the life of the region. Now, it looks like the ultimate Pipelineistan deal, worth US$1 trillion and 10 years in the making, will be signed off on as well. In it, the giant, state-controlled Russian energy giant Gazprom will agree to supply the giant state-controlled China National Petroleum Corporation (CNPC) with 3.75 billion cubic feet of liquefied natural gas a day for no less than 30 years, starting in 2018. That's the equivalent of a quarter of Russia's gas exports to all of Europe. China's present daily gas demand is around 16 billion cubic feet a day, and imports account for 31.6% of total consumption. Gazprom may still collect the bulk of its profits from Europe, but Asia could turn out to be its Everest. The company will use this mega-deal to boost investment in Eastern Siberia and the whole region will be reconfigured as a privileged gas hub for Japan and South Korea as well. If you want to know why no key country in Asia has been willing to "isolate" Russia in the midst of the Ukrainian crisis - and in defiance of the Obama administration - look no further than Pipelineistan. Exit the Petrodollar, enter the Gas-o-Yuan And then, talking about anxiety in Washington, there's the fate of the petrodollar to consider, or rather the "thermonuclear" possibility that Moscow and Beijing will agree on payment for the Gazprom-CNPC deal not in petrodollars but in Chinese yuan. One can hardly imagine a more tectonic shift, with Pipelineistan intersecting with a growing Sino-Russian political-economic-energy partnership. Along with it goes the future possibility of a push, led again by China and Russia, toward a new international reserve currency - actually a basket of currencies - that would supersede the dollar (at least in the optimistic dreams of BRICS members). Right after the potentially game-changing Sino-Russian summit comes a BRICS summit in Brazil in July. That's when a $100 billion BRICS development bank, announced in 2012, will officially be born as a potential alternative to the International Monetary Fund and the World Bank as a source of project financing for the developing world. More BRICS cooperation meant to bypass the dollar is reflected in the "Gas-o-yuan", as in natural gas bought and paid for in Chinese currency. Gazprom is even considering marketing bonds in yuan as part of the financial planning for its expansion. Yuan-backed bonds are already trading in Hong Kong, Singapore, London, and most recently Frankfurt. Nothing could be more sensible for the new Pipelineistan deal than to have it settled in yuan. Beijing would pay Gazprom in that currency (convertible into roubles); Gazprom would accumulate the yuan; Russia would then buy myriad made-in-China goods and services in yuan convertible into roubles. It's common knowledge that banks in Hong Kong, from Standard Chartered to HSBC - as well as others closely linked to China via trade deals - have been diversifying into the yuan, which implies that it could become one of the de facto global reserve currencies even before it's fully convertible. (Beijing is unofficially working for a fully convertible yuan by 2018.) The Russia-China gas deal is inextricably tied up with the energy relationship between the European Union and Russia. After all, the bulk of Russia's gross domestic product comes from oil and gas sales, as does much of its leverage in the Ukraine crisis. In turn, Germany depends on Russia for a hefty 30% of its natural gas supplies. Yet Washington's geopolitical imperatives - spiced up with Polish hysteria - have meant pushing Brussels to find ways to "punish" Moscow in the future energy sphere (while not imperiling present day energy relationships). There's a consistent rumble in Brussels these days about the possible cancellation of the projected 16 billion euro (US$22 billion) South Stream pipeline, whose construction is to start in June. On completion, it would pump yet more Russian natural gas to Europe - in this case, underneath the Black Sea (bypassing Ukraine) to Bulgaria, Hungary, Slovenia, Serbia, Croatia, Greece, Italy, and Austria. Bulgaria, Hungary, and the Czech Republic have already made it clear that they are firmly opposed to any cancellation, and cancellation is probably not in the cards. After all, the only obvious alternative is Caspian Sea gas from Azerbaijan, and that isn't likely to happen unless the EU develops its own construction projects. In any case, Azerbaijan doesn't have enough capacity to supply the levels of natural gas needed, and other actors like Kazakhstan, plagued with infrastructure problems, or unreliable Turkmenistan, which prefers to sell its gas to China, are already largely out of the picture. And don't forget that South Stream, coupled with subsidiary energy projects, will create a lot of jobs and investment in many of the most economically devastated EU nations. Nonetheless, such EU threats, however unrealistic, only serve to accelerate Russia's increasing symbiosis with Asian markets. For Beijing especially, it's a win-win situation. After all, between energy supplied across seas policed and controlled by the US Navy and steady, stable land routes out of Siberia, it's no contest. Pick your own Silk Road Of course, the US dollar remains the top global reserve currency, involving 33% of global foreign exchange holdings at the end of 2013, according to the IMF. It was, however, at 55% in 2000. Nobody knows the percentage in yuan (and Beijing isn't talking), but the IMF notes that reserves in "other currencies" in emerging markets have been up 400% since 2003. The Federal Reserve is arguably monetizing 70% of the US government debt in an attempt to keep interest rates from heading skywards. Pentagon adviser Jim Rickards, as well as every Hong Kong-based banker, tends to believe that the Fed is bust (though they won't say it on the record). No one can even imagine the extent of the possible future deluge the US dollar might experience amid a $1.4 quadrillion Mount Ararat of financial derivatives. Don't think that this is the death knell of Western capitalism, however, just the faltering of that reigning economic faith, neoliberalism, still the official ideology of the United States, the overwhelming majority of the European Union, and parts of Asia and South America. As far as what might be called the "authoritarian neoliberalism" of the Middle Kingdom, what's not to like at the moment? China has proven that there is a result-oriented alternative to the Western "democratic" capitalist model for nations aiming to be successful. It's building not one, but myriad new Silk Roads, far-reaching webs of high-speed railways, highways, pipelines, ports, and fiber-optic networks across huge parts of Eurasia. These include a Southeast Asian road, a Central Asian road, an Indian Ocean "maritime highway" and even a high-speed rail line through Iran and Turkey reaching all the way to Germany. In April, when President Xi Jinping visited the city of Duisburg on the Rhine River, with the world's largest inland harbor and right in the heartland of Germany's Ruhr steel industry, he made an audacious proposal: a new "economic Silk Road" should be built between China and Europe, on the basis of the Chongqing-Xinjiang-Europe railway, which already runs from China to Kazakhstan, to continue through Russia, Belarus, Poland, and finally Germany. That's 15 days by train, 20 less than for cargo ships sailing from China's eastern seaboard. Now that would represent the ultimate geopolitical earthquake in terms of integrating economic growth across Eurasia. Keep in mind that, if no bubbles burst, China is about to become - and remain - the number one global economic power, a position it enjoyed for 18 of the past 20 centuries. But don't tell London hagiographers; they still believe that US hegemony will last, well, forever. Take me to Cold War 2.0 Despite recent serious financial struggles, the BRICS countries have been consciously working to become a counterforce to the original and - having tossed Russia out in March - once again Group of 7, or G-7. They are eager to create a global architecture to replace the one first imposed in the wake of World War II, and they see themselves as a potential challenge to the exceptionalist and unipolar world that Washington imagines for our future (with itself as the global robocop and NATO as its robo-police force). Historian and imperialist cheerleader Ian Morris, in his book War! What is it Good For?, defines the US as the ultimate "globocop" and "the last best hope of Earth". If that globocop "wearies of its role", he writes, "there is no plan B". Well, there is a plan BRICS - or so the BRICS nations would like to think, at least. And when the BRICS do act in this spirit on the global stage, they quickly conjure up a curious mix of fear, hysteria, and pugnaciousness in the Washington establishment. Take Christopher Hill as an example. The former assistant secretary of state for East Asia and US ambassador to Iraq is now an advisor with the Albright Stonebridge Group, a consulting firm deeply connected to the White House and the State Department. When Russia was down and out, Hill used to dream of a hegemonic American "new world order". Now that the ungrateful Russians have spurned what "the West has been offering" - that is, "special status with NATO, a privileged relationship with the European Union, and partnership in international diplomatic endeavors" - they are, in his view, busy trying to revive the Soviet empire. Translation: if you're not our vassals, you're against us. Welcome to Cold War 2.0. The Pentagon has its own version of this directed not so much at Russia as at China, which, its think tank on future warfare claims, is already at war with Washington in a number of ways. So if it's not apocalypse now, it's Armageddon tomorrow. And it goes without saying that whatever's going wrong, as the Obama administration very publicly "pivots" to Asia and the American media fills with talk about a revival of Cold War-era "containment policy" in the Pacific, it's all China's fault. Embedded in the mad dash toward Cold War 2.0 are some ludicrous facts-on-the-ground: the US government, with $17.5 trillion in national debt and counting, is contemplating a financial showdown with Russia, the largest global energy producer and a major nuclear power, just as it's also promoting an economically unsustainable military encirclement of its largest creditor, China. Russia runs a sizeable trade surplus. Humongous Chinese banks will have no trouble helping Russian banks out if Western funds dry up. In terms of inter-BRICS cooperation, few projects beat a $30 billion oil pipeline in the planning stages that will stretch from Russia to India via Northwest China. Chinese companies are already eagerly discussing the possibility of taking part in the creation of a transport corridor from Russia into Crimea, as well as an airport, shipyard, and liquid natural gas terminal there. And there's another "thermonuclear" gambit in the making: the birth of a natural gas equivalent to the Organization of the Petroleum Exporting Countries that would include Russia, Iran, and reportedly disgruntled US ally Qatar. The (unstated) BRICS long-term plan involves the creation of an alternative economic system featuring a basket of gold-backed currencies that would bypass the present America-centric global financial system. (No wonder Russia and China are amassing as much gold as they can.) The euro - a sound currency backed by large liquid bond markets and huge gold reserves - would be welcomed in as well. It's no secret in Hong Kong that the Bank of China has been using a parallel SWIFT network to conduct every kind of trade with Tehran, which is under a heavy US sanctions regime. With Washington wielding Visa and MasterCard as weapons in a growing Cold War-style economic campaign against Russia, Moscow is about to implement an alternative payment and credit card system not controlled by Western finance. An even easier route would be to adopt the Chinese Union Pay system, whose operations have already overtaken American Express in global volume. I'm just pivoting with myself No amount of Obama administration "pivoting" to Asia to contain China (and threaten it with US Navy control of the energy sea lanes to that country) is likely to push Beijing far from its Deng Xiaoping-inspired, self-described "peaceful development" strategy meant to turn it into a global powerhouse of trade. Nor are the forward deployment of US or NATO troops in Eastern Europe or other such Cold-War-ish acts likely to deter Moscow from a careful balancing act: ensuring that Russia's sphere of influence in Ukraine remains strong without compromising trade and commercial, as well as political, ties with the European Union - above all, with strategic partner Germany. This is Moscow's Holy Grail; a free-trade zone from Lisbon to Vladivostok, which (not by accident) is mirrored in China's dream of a new Silk Road to Germany. Increasingly wary of Washington, Berlin for its part abhors the notion of Europe being caught in the grips of a Cold War 2.0. German leaders have more important fish to fry, including trying to stabilize a wobbly EU while warding off an economic collapse in southern and central Europe and the advance of ever more extreme rightwing parties. On the other side of the Atlantic, President Obama and his top officials show every sign of becoming entangled in their own pivoting - to Iran, to China, to Russia's eastern borderlands, and (under the radar) to Africa. The irony of all these military-first maneuvers is that they are actually helping Moscow, Tehran, and Beijing build up their own strategic depth in Eurasia and elsewhere, as reflected in Syria, or crucially in ever more energy deals. They are also helping cement the growing strategic partnership between China and Iran. The unrelenting Ministry of Truth narrative out of Washington about all these developments now carefully ignores the fact that, without Moscow, the "West" would never have sat down to discuss a final nuclear deal with Iran or gotten a chemical disarmament agreement out of Damascus. When the disputes between China and its neighbors in the South China Sea and between that country and Japan over the Senkaku/Diaoyou islands meet the Ukraine crisis, the inevitable conclusion will be that both Russia and China consider their borderlands and sea lanes private property and aren't going to take challenges quietly - be it via NATO expansion, US military encirclement, or missile shields. Neither Beijing nor Moscow is bent on the usual form of imperialist expansion, despite the version of events now being fed to Western publics. Their "red lines" remain essentially defensive in nature, no matter the bluster sometimes involved in securing them. Whatever Washington may want or fear or try to prevent, the facts on the ground suggest that, in the years ahead, Beijing, Moscow, and Tehran will only grow closer, slowly but surely creating a new geopolitical axis in Eurasia. Meanwhile, a discombobulated America seems to be aiding and abetting the deconstruction of its own unipolar world order, while offering the BRICS a genuine window of opportunity to try to change the rules of the game. Russia and China in pivot mode In Washington's think-tank land, the conviction that the Obama administration should be focused on replaying the Cold War via a new version of containment policy to "limit the development of Russia as a hegemonic power" has taken hold. The recipe: weaponize the neighbors from the Baltic states to Azerbaijan to "contain" Russia. Cold War 2.0 is on because, from the point of view of Washington's elites, the first one never really left town. Yet as much as the US may fight the emergence of a multipolar, multi-powered world, economic facts on the ground regularly point to such developments. The question remains: will the decline of the hegemon be slow and reasonably dignified, or will the whole world be dragged down with it in what has been called "the Samson option"? While we watch the spectacle unfold, with no end-game in sight, keep in mind that a new force is growing in Eurasia, with the Sino-Russian strategic alliance threatening to dominate its heartland along with great stretches of its inner rim. Now, that's a nightmare of Mackinderesque proportions from Washington's point of view. Think, for instance, of how Zbigniew Brzezinski, the former national security adviser who became a mentor on global politics to President Obama, would see it. In his 1997 book The Grand Chessboard, Brzezinski argued that "the struggle for global primacy [would] continue to be played" on the Eurasian "chessboard", of which "Ukraine was a geopolitical pivot". "If Moscow regains control over Ukraine," he wrote at the time, Russia would "automatically regain the wherewithal to become a powerful imperial state, spanning Europe and Asia." That remains most of the rationale behind the American imperial containment policy - from Russia's European "near abroad" to the South China Sea. Still, with no end-game in sight, keep your eye on Russia pivoting to Asia, China pivoting across the world, and the BRICS hard at work trying to bring about the new Eurasian Century. Pepe Escobar is the author of Globalistan: How the Globalized World is Dissolving into Liquid War (Nimble Books, 2007), Red Zone Blues: a snapshot of Baghdad during the surge (Nimble Books, 2007), and Obama does Globalistan (Nimble Books, 2009). He may be reached at pepeasia@yahoo.com.

THE ROVING EYE - Why the EU can't 'isolate' Russia - By Pepe Escobar

THE ROVING EYE Why the EU can't 'isolate' Russia By Pepe Escobar German Chancellor Angela Merkel could teach US President Barack Obama one or two things about how to establish a dialogue with Russian President Vladimir Putin. As if Obama would listen. He'd rather boost his constitutional law professor self, and pompously lecture an elite eurocrat audience in the glittering Palais des Beaux-Arts in Brussels, like he did this Wednesday, on how Putin is the greatest threat to the US-administered global order since World War II. Well, it didn't go that well; most eurocrats were busy taking selfies or twittering. Putin, meanwhile, met with the CEO of German engineering and electrical conglomerate Siemens, Joe Kaeser, at his official residence outside Moscow. Siemens invested more than US$1.1 billion in Russia over the past two years, and that, Kaeser said, is bound to continue. Angela was certainly taking notes. Obama couldn't behave otherwise. The constitutional law expert knows nothing about Russia, in his (meager) political career never had to understand how Russia works, and may even fear Russia - surrounded as he is by a coterie of spectacularly mediocre aids. His Brussels rhetorical tour de force yielded absolutely nothing - apart from the threat that if Putin persisted in his "aggression" against eastern Ukraine or even NATO members-countries the president of the United States would unroll a much stiffer sanction package. What else is new, considering this by supreme CIA asset and former Pentagon head in the first Obama administration, Bob Gates, is what passes for political analysis in the US. The $1 trillion game-changer  Demonized 24/7 by the sprawling Western propaganda machine as a ruthless aggressor, Putin and his Kremlin advisers just need to play Sun Tzu. The regime changers in Kiev are already mired in a vicious catfight. [1] And even Ukraine's acting Prime Minister Arseniy Petrovych "Yats" Yatsenyuk has identified the gloomy times ahead, stressing that the signature of the economic part of the association agreement between Ukraine and the EU has been postponed - so there will be no "negative consequences" for industrialized eastern Ukraine. Translation: he knows this will be the kiss of death for Ukrainian industry, on top of it coupled with an imminent structural adjustment by the International Monetary Fund linked to the EU (maybe) bailing out a bankrupt Ukraine. Asia Times Online's Spengler coined a formulation: "A specter is haunting Europe, and that is the specter of a Russian-Chinese alliance at the expense of Europe." The alliance is already on - manifested in the G-20, the BRICS and the Shanghai Cooperation Organization. There are military technology synergies on the horizon - the ultra-sophisticated S-500 air defense system is to be unveiled by Moscow, and Beijing would absolutely love to have it. But for the real fireworks, just wait a few weeks, when Putin visits Beijing in May. That's when he will sign the famous $1 trillion gas deal according to which Gazprom will supply China's CNPC with 3.75 billion cubic feet of gas a day for 30 years, starting in 2018 (China's current daily gas demand is around 16 billion cubic feet). Gazprom may still collect most of its profits from Europe, but Asia is its privileged future. On the competition front, the hyper-hyped US shale "revolution" is a myth - as much as the notion the US will be suddenly increasing exports of gas to the rest of the world any time soon. Gazprom will use this mega-deal to boost investment in eastern Siberia - which sooner rather than later will be configured as the privileged hub for gas shipments to both Japan and South Korea. That's the ultimate (substantial) reason why Asia won't "isolate" Russia. ( See Asia will not 'isolate' Russia, Asia Times Online, March 25, 2014.) Not to mention the much-anticipated "thermonuclear" (for the petrodollar) possibility that Russia and China will agree payment for the Gazprom-CNPC deal may be in yuan or rubles. That will be the dawn of a basket of currencies as the new international reserve currency - a key BRICS objective and the ultimate, incendiary, new (economic) fact on the ground. Time to invest in Pipelineistan  Even though its centrality pales compared to Asia, Europe, of course, is not "expendable" for Russia. There have been rumbles in Brussels by some poodles about canceling the South Stream pipeline - pumping Russian gas underneath the Black Sea (and bypassing Ukraine) to Bulgaria, Hungary, Slovenia, Serbia, Croatia, Greece, Italy and Austria. The Bulgarian Economy and Energy Minister, Dragomir Stoynev, said no way. Same for the Czech Republic, because it badly needs Russian investment, and Hungary, which recently signed a nuclear energy deal with Moscow. The only other possibility for the EU would be Caspian gas, from Azerbaijan - following on the trail of the Zbig Brzezinski-negotiated Baku-Tblisi-Ceyhan (BTC) oil pipeline, which was conceived expressly to bypass both Russia and Iran. As if the EU would have the will, the speed and funds to spend billions of dollars to build yet another pipeline virtually tomorrow, and assuming Azerbaijan had enough supply capacity (it doesn't; other actors, like Kazakhstan or ultra-unreliable Turkmenistan, which prefers to sell its gas to China, would have to be part of the picture). Well, nobody ever lost money betting on the cluelessness of Brussels eurocrats. South Stream and other energy projects will create a lot of jobs and investment in many of the most troubled EU nations. Extra sanctions? No less than 91% of Poland's energy, and 86% of Hungary's, come from Russia. Over 20% of the foreign lending of French banks is to Russian companies. No less than 68 Russian companies trade at the London Stock Exchange. For the Club Med nations, Russian tourism is now a lifeline (1 million went to Italy last year, for instance.) US Think Tankland is trying to fool American public opinion into believing what the Obama administration should be applying is a replay of the "containment" policy of 1945-1989 to "limit the development of Russia as a hegemonic power". The "recipe": weaponize everybody and his neighbor, from the Baltic nations to Azerbaijan, to "contain" Russia. The New Cold War is on because, from the point of view of US so-called "elites", it never really left. Meanwhile, Gazprom's stock price is up. Buy now. You won't regret it. Notes: 1. Popcorn Please While "Putin's Agitators" Rule in Kiev, Moon of Alabama, March 26, 2014. Pepe Escobar is the author of Globalistan: How the Globalized World is Dissolving into Liquid War (Nimble Books, 2007), Red Zone Blues: a snapshot of Baghdad during the surge (Nimble Books, 2007), and Obama does Globalistan (Nimble Books, 2009). He may be reached at pepeasia@yahoo.com.

THE ROVING EYE The new Great (Threat) Game in Eurasia By Pepe Escobar

THE ROVING EYE The new Great (Threat) Game in Eurasia By Pepe Escobar In Ukraine, the West supported an unconstitutional putsch against an elected government perpetrated, among others, by fascist/neo-nazi storm troopers (Svoboda, Right Sector) instrumentalized by US intelligence. After a Russian counterpunch, US President Barack Obama proclaimed that any referendum in Crimea would "violate the Ukrainian constitution and violate international law." This is just the latest instance in the serial rape of "international law". The rap sheet is humongous, including; NATO bombing Serbia for 78 days in 1999 to allow Kosovo to secede; the 2003 US invasion and subsequent trillion-dollar occupation and civil war creation in Iraq; NATO/AFRICOM bombing Libya in 2011 invoking R2P ("responsibility to protect") as a cover to provoking regime change; US investment in the secession of oil-wealthy South Sudan, so China has to deal with an extra geopolitical headache; and US investment in perennial civil war in Syria. Yet Moscow still (foolishly?) believes international law should be respected - presenting to the UN Security Council classified information on all Western intel/psy-ops moves leading to the coup in Kiev, including "training" provided by Poland and Lithuania, not to mention Turkish intelligence involvement in setting up a second coup in Crimea. Russian diplomats called for an unbiased international investigation. That will never happen; Washington's narrative would be completely debunked. Thus a US veto at the UN. Russian Foreign Minister Sergei Lavrov also called for the Organization for Security and Co-operation in Europe to objectively investigate those snipers shooting everyone on sight in Kiev, as revealed by Estonia's foreign minister to EU foreign policy supremo Catherine "I love Yats" Ashton. According to Russia's ambassador to the UN Vitaly Churkin, "a completely different picture would be drawn compared to what is being depicted by American media and, unfortunately, by some American and European politicians." Needless to say, there will be no investigation. Hi, I'm your good neo-nazi Everyone remembers the "good Taliban", with which the US could negotiate in Afghanistan. Then came the "good al-Qaeda", jihadis the US could support in Syria. Now come the "good neo-nazis", with which the West can do business in Kiev. Soon there will be "the good jihadis supporting neo-nazis", who may be deployed to advance US/NATO and anti-Russian designs in Crimea and beyond. After all, Obama mentor Dr Zbigniew "The Grand Chessboard" Brzezinski is the godfather of good jihadis, fully weaponized to fight the former Soviet Union in Afghanistan. As facts on the ground go, neo-nazis are definitely back as good guys. For the first time since the end of World War II, fascists and neo-nazis are at the helm of a European nation (although Ukraine most of all should be characterized as the key swing nation in Eurasia). Few in the West seem to have noticed it. The cast of characters include Ukrainian interim defense minister and former student at the Pentagon Ihor Tenyukh; deputy prime minister for economic affairs and Svoboda ideologue Oleksandr Sych; agro-oligarch minister of agriculture Ihor Svaika (Monsanto, after all, needs a chief enforcer); National Security Council chief and Maidan commander of Right Sector neo-nazis Andry Parubiy; and deputy National Security Council chief Dmytro Yarosh, the founder Right Sector. Not to mention Svoboda leader Oleh Tyanhybok, a close pal of John McCain and Victoria "F**k the EU" Nuland, and active proponent of an Ukraine free from the "Muscovite-Jewish mafia." As the Kremlin refuses to deal with this bunch and the upcoming March 16 referendum in Crimea is practically a done deal, Team "Yats" is fully legitimized, with honors, by Team Obama, leader included, in Washington. To quote Lenin, what is to be done? A close reading of President Putin's moves would suggest an answer: nothing. As in just waiting, while outsourcing the immediate future of a spectacularly bankrupt Ukraine to the EU. The EU is impotent to rescue even the Club Med countries. Inevitably, sooner or later, threat of sanctions or not, it will come crawling back to Moscow seeking "concessions", so Russia may also foot the bill. Meanwhile, in Pipelineistan … Meanwhile, the New Great (Threat) Game in Eurasia advances unabated. Moscow would willingly compromise on a neutral Ukraine - even with neo-nazis in power in Kiev. But an Ukraine attached to NATO is an absolute red line. By the way, NATO is "monitoring" Ukraine with AWACS deployed in Polish and Romanian airspace. So as the much lauded "reset" between the Kremlin and the Obama administration is for all practical purposes six feet under (with no Hollywood-style second coming in the cards), what's left is the dangerous threat game. Deployed not only by the Empire, but also by the minions. That monster collection of Magritte-style faceless bureaucrats at the European Commission (EU), following on the non-stop threat of EU sanctions, has decided to delay a decision on whether Gazprom may sell more gas through the OPAL pipeline in Germany, and also delay negotiations on the legal status of South Stream, the pipeline under the Black Sea which should become operational in 2015. As if the EU had any feasible Plan B to escape its dependency on Russian gas (not to mention eschew the very profitable financial game played between key European capitals and Moscow). What are they do, import gas on Qatar Airways flights? Buy LNG from the US - something that will not be feasible in years to come? The fact is the minute a gas war is on, if it ever comes down to it, the EU will be under immense pressure by a host of member-nations to keep (and even extend) its Russian gas fix - with or without "our (neo-nazi) bastards" in power in Kiev. Brussels knows it. And most of all, Vlad the Hammer knows it. Pepe Escobar is the author of Globalistan: How the Globalized World is Dissolving into Liquid War (Nimble Books, 2007), Red Zone Blues: a snapshot of Baghdad during the surge (Nimble Books, 2007), and Obama does Globalistan (Nimble Books, 2009). He may be reached at pepeasia@yahoo.com.

Friends-Enemies-Both? Our Foreign Policy Riddle // The Three-Decade US-Mujahideen Partnership Still Going Strong

In the last few weeks I’ve been reading and talking about the latest developments in Central Asia and the Caucasus. I am planning to post a few updates on the status of the score board in this region (pipeline rivalries, military base ‘erection’ scores- and what-not). Meanwhile, as I am dealing with all this I keep ending up with riddle-like situations. And instead of trying to solve or get out of these riddles, I’m going to give up and instead share one of them with you, my blogosphere friends.

Our enemies’ enemies are our friends. Many of our nation’s enemies are the enemies of our enemies, so that makes them what? Friends? Enemies? It depends? Both? And what would all this make our ‘real’ foreign policy makers? Enemies? Friends? Both? What?

Seriously! Think about it.

By now we all know, or should know, about our government and mainstream media’s past almost romantic relationship with the Mujahideen, Taliban-al Qaeda, during the 80s. Back then, in the 80s, they were fighting the Soviets, they were the enemies of our enemies, thus, our beloved friends, our trusted, financed and backed allies. Here are a few excerpts from what I wrote and quoted on this topic a while back:

Now let’s go back and search U.S. press coverage of Afghanistan’s ‘Freedom Fighters’ during the 80s and try to find any coverage related to these U.S. backed and supported operations’ intersection with the global narcotics trade. Are there any? I’m afraid we know the answer to this question. Here is further coverage based on the report by FAIR:

“The press coverage of this era was overwhelmingly positive, even glowing, with regard to the guerrillas’ conduct in Afghanistan. Their unsavory features were downplayed or omitted altogether…Virtually all papers favored some amount of U.S. military support; and there was near unanimous agreement that the guerrillas were “heroic,” “courageous” and above all “freedom fighters.“”

“According to the L.A. Times (6/23/86): “The Afghan guerrillas have earned the admiration of the American people for their courageous struggle…. The rebels deserve unstinting American political support and, within the limits of prudence, military hardware.“”

And here the axis of U.S. Government-U.S. Press- and the information spin or black-out:

“Another problem was direct manipulation of reporting by the U.S. government, which was supporting the Mujahiddin guerrillas during both the Carter and Reagan administrations. (Indeed, we now know that U.S. aid to the Mujahiddin was secretly begun in July 1979, six months before the Soviets invaded–International Politics, 6/00.) This press manipulation began early in the conflict. In January 1980, the New York Times (1/26/80) reported that the State Department had “relaxed” its accuracy code for reporting information on Afghanistan. As a result, the Carter administration generated “accounts suggesting Soviet actions for which the administration itself has no solid foundation.“”

During the 80s our ‘real’ foreign policymakers couldn’t care less about adjectives such as extremists, terrorists, fanatics, anti-west…They were the beloved enemies of our enemies, and we’d do anything to support and use them. And this wasn’t necessarily about we the people of the US or our benefits or our best interests. After all, in the end the American people were the ones to pay the price for those unholy alliances where we selected, trained and backed the evildoer Bin Laden, our enemies’ enemy, thus, our beloved friend:

Our enemies’ enemies were our friends. Many of our nation’s enemies were the enemies of our enemies back then, so that made them our beloved friends.

Now, you may say, ‘that was a long time ago, it had to do with the Cold War, and it is simply not fair to criticize and judge based on this particular example…’And, I’d say, okay. Let’s fast forward. Let’s look at what we did with these same groups, in the 90s, after the wall came down and the Soviet empire collapsed.

The problem is this: without the Cold War excuse our foreign policymakers had a real hard time justifying our joint operations and terrorism schemes in the resource-rich ex Soviet states with these same groups, so they made sure they kept these policies unwritten and unspoken, and considering their grip on the mainstream media, largely unreported. Now what would your response be if I were to say, on the record, and if required, under oath:

Between 1996 and 2002, we, the United States, planned, financed and help execute every single major terrorist incident by Chechen rebels (and the Mujahideen) against Russia

Between 1996 and 2002, we, the United States, planned, financed and help execute every single uprising and terrorism related scheme in Xinxiang (aka East Turkistan and Uyghurstan)

Between 1996 and 2002, we, the United States, planned and carried out at least two assassination schemes against pro Russia officials in Azerbaijan

…

Those of you who are truly familiar with our real history and foreign policy making past would yawn, and say, ‘but of course. That has been our modus operandi for many decades.’ Unfortunately, the great majority would either be shocked if open minded, or shake their head in disbelief and write it off as another ‘conspiracy theory;’ well, thanks to our mainstream media.

You may remember one of these foreign policy makers from my State Secrets Privilege Gallery and my under oath testimony in the Krikorian case. Here is a quote from Graham A. Fuller, former Deputy Director of the CIA’s National Council on Intelligence:

‘The policy of guiding the evolution of Islam and of helping them against our adversaries worked marvelously well in Afghanistan against the Red Army. The same doctrines can still be used to destabilize what remains of Russian power, and especially to counter the Chinese influence in Central Asia.’

And this goes to the heart of our ‘real’ foreign policy practices showing our ‘real’ stand on Taliban years after the end of the Cold War and the first World Trade Center bombing:

Testifying before the Senate Foreign Relations Subcommittee on South Asia, Congressman Dana Rohrabacher – former White House Special Assistant to President Reagan and now Senior Member of the House International Relations Committee – declared that ‘this administration has a covert policy that has empowered the Taliban and enabled this brutal movement to hold on to power’. The assumption is that ‘the Taliban would bring stability to Afghanistan and permit the building of oil pipelines from Central Asia through Afghanistan to Pakistan’. US companies involved in the project included UNOCAL and ENRON. As early as May 1996, UNOCAL had officially announced plans to build a pipeline to transport natural gas from Turkmenistan to Pakistan through western Afghanistan.

And Chechens are good friends since they are the enemies of our enemy, Russia:

From the mid-1990s, bin Laden funded Chechen guerrilla leaders Shamil Basayev and Omar ibn al-Khattab to the tune of several millions of dollars per month, sidelining the moderate Chechen majority. US intelligence remained deeply involved until the end of the decade. According to Yossef Bodanksy, then-Director of the US Congressional Task Force on Terrorism and Unconventional Warfare, Washington was actively involved in ‘yet another anti-Russian jihad, ‘seeking to support and empower the most virulent anti-Western Islamist forces’. US Government officials participated in ‘a formal meeting in Azerbaijan’ in December 1999 ‘in which specific programmes for the training and equipping of mujahidin from the Caucasus, Central/South Asia and the Arab world were discussed and agreed upon’, culminating in ‘Washington’s tacit encouragement of both Muslim allies (mainly Turkey, Jordan and Saudi Arabia) and US “private security companies”… to assist the Chechens and their Islamist allies to surge in the spring of 2000 and sustain the ensuing jihad for a long time.’ The US saw the sponsorship of ‘Islamist jihad in the Caucasus’ as a way to ‘deprive Russia of a viable pipeline route through spiraling violence and terrorism’.

…

Okay, so the partnership and joint operations between our operatives and the Mujahideen (including the Taliban & al Qaeda) continued after the Cold War, and even after the first World Trade Center bombing, Khobar Towers, and the 1998 Embassy Bombings. On one hand we were declaring these people as our enemies, on the other hand, in Central Asia-Caucaus-Balkans and Xinxiang, they were the enemies of our enemies , thus our good partners and dear old friends. Except, by this time, the majority of us had stopped considering the Russians and Chinese enemies, instead they were viewed as mere competitors. And with that, the riddle slightly changes here:

Our competitors’ enemies were our friends. Many of our nation’s enemies were willing to become the enemies of our competitors, so that made them our dear friends.

You’d think after the September 11 Terrorist Attacks our foreign policy makers would seriously rethink their past M.O. and cease certain friendships and unholy alliances, despite the severe monetary consequences for a handful in the oil and MIC industries. But no. That doesn’t appear to be the case. And, as always, you won’t get the ‘real’ stories on this from the MSM. Here is a recent example:

Persistent accounts of western forces in Afghanistan using their helicopters to ferry Taleban fighters, strongly denied by the military, is feeding mistrust of the forces that are supposed to be bringing order to the country.

One such tale came from a soldier from the 209th Shahin Corps of the Afghan National Army, fighting against the growing insurgency in Kunduz province in northern Afghanistan. Over several months, he had taken part in several pitched battles against the armed opposition.

“Just when the police and army managed to surround the Taleban in a village of Qala-e-Zaal district, we saw helicopters land with support teams,” he said. “They managed to rescue their friends from our encirclement, and even to inflict defeat on the Afghan National Army.”

This story, in one form or another, is being repeated throughout northern Afghanistan. Dozens of people claim to have seen Taleban fighters disembark from foreign helicopters in several provinces. The local talk is of the insurgency being consciously moved north, with international troops ferrying fighters in from the volatile south, to create mayhem in a new location.Helicopters are almost exclusively the domain of foreign forces in Afghanistan – the international military controls the air space, and has a virtual monopoly on aircraft. So when Afghans see choppers, they think foreign military.

“Our fight against the Taleban is nonsense,” said the soldier from Shahin Corps. “Our foreigner ‘friends’ are friendlier to the opposition.”

…

Let’s take a look at certain important northern neighbors in Afghanistan where our ‘real’ policymakers have been facing…hmmm… frustration, thus, in need of friends to get back at those who’ve been causing this…hmmmmm… frustration:

Previously close to Washington (which gave Uzbekistan half a billion dollars in aid in 2004, about a quarter of its military budget), the government of Uzbekistan has recently restricted American military use of the airbase at Karshi-Khanabad for air operations in neighboring Afghanistan.

The relationship between Uzbekistan and the United States began to deteriorate after the so-called “colour revolutions” in Georgia and Ukraine (and to a lesser extent Kyrgyzstan). When the U.S. joined in a call for an independent international investigation of the bloody events at Andijon, the relationship took an additional nosedive, and President Islam Karimov changed the political alignment of the country to bring it closer to Russia and China, countries which chose not to criticise Uzbekistan’s leaders for their alleged human rights violations.

In late July 2005, the government of Uzbekistan ordered the United States to vacate an air base in Karshi-Kanabad (near Uzbekistan’s border with Afghanistan) within 180 days. Karimov had offered use of the base to the U.S. shortly after 9/11. It is also believed by some Uzbeks that the protests in Andijan were brought about by the U.K. and U.S. influences in the area of Andijan. This is another reason for the hostility between Uzbekistan and the West.

…

And this to sweeten the deal, or is it turning it into a rather strong vinegar, at least for the ones who count in making and implementing our unwritten and unspoken foreign policy practices:

The leaders of Uzbekistan and China on Wednesday said they had signed deals aimed at increasing cooperation on energy and regional security. Speaking ahead of an annual meeting of the Chinese-led Shanghai Cooperation Organisation meeting in Tashkent, Chinese President Hu Jintao and Uzbek President Islam Karimov pledged closer ties, particularly on nuclear fuel.

“One of the question we discussed was that of long-term and stable cooperation in the field of … uranium. It’s necessary to work in such a way to develop natural uranium and uranium fields,” Hu told reporters.

Although the leaders said they had signed a number of agreements regarding the purchase of energy from Uzbekistan, including uranium and natural gas, they declined to provide specifics details on the deals.

…

Okay, so you get the general picture on Uzbekistan. Right?

Next, let’s take a quick look at Turkmenistan:

Turkmenistan ranks fourth in the world to Russia, Iran and the United States in natural gas reserves. The Turkmenistan Natural Gas Company (Türkmengaz), under the auspices of the Ministry of Oil and Gas, controls gas extraction in the country. Gas production is the most dynamic and promising sector of the national economy. Turkmenistan’s gas reserves are estimated at 3.5-6.7 mcubic meters and its prospecting potential at up to 21 trillion cubic meters. In 2010 Ashgabat started a policy of diversifying export routes for its raw materials.

China is set to become the largest buyer of gas from Turkmenistan over the coming years as a pipeline linking the two countries, through Uzbekistan and Kazakhstan, reaches full capacity. In addition to supplying Russia, China and Iran, Ashgabat took concrete measures to accelerate progress in the construction of the Turkmenistan-Afghanistan-Pakistan and India pipeline (TAPI). Turkmenistan has previously estimated the cost of the project at $3.3 billion. On May 21st, president Gurbanguly Berdymukhammedov unexpectedly signed a decree stating that companies from Turkmenistan will build an internal East-West gas pipeline allowing the transfer of gas from the biggest deposits in Turkmenistan (Dowlatabad and Yolotan) to the Caspian coast. The East-West pipeline is planned to be around 1000 km long and have a carrying capacity of 30 bn m³ annually, at a cost of between one and one and a half billion US dollars.

…

And, this is the latest to truly pi.. off our ‘real’ foreign policy beneficiaries:

China National Petroleum Corporation (CNPC) has announced the discovery of yet another gas field on the right bank of the Amu Darya River in Turkmenistan, holding in excess of 100 billion cubic meters (bcm) of gas.

Separately, Turkmenistan President Gurbanguly Berdimuhamedow inaugurated a new compressor station at the Bagtiyarlyk fields, estimated by Chinese engineers to hold 1.6 trillion cubic meters of natural gas.

These fields feed the Turkmenistan-China pipeline, which traverses Uzbekistan and Kazakhstan and was opened in December 2009 with a projected capacity of 40 billion cubic meters per year (bcm/y) by 2015, with some of that volume being consumed in southern Kazakhstan. (See Gas pipeline gigantism, Asia Times Online, July 17, 2008.)

In June this year, Ashgabad and Beijing agreed to increase Turkmen exports to China above the agreed level; the new compressor station will eventually raise the existing capacity to 22 bcm/y from the 6 bcm/y estimate of Chinese consumption of Turkmenistan-sourced gas for 2010.

…

And here, a brief snapshot of where Tajikistan stands:

Tajikistan is ready to further improve its cooperation in various fields with China, and make joint efforts to ensure the continued success of the Shanghai Cooperation Organization (SCO), President Emomali Rakhmonov said in a recent interview with Chinese media.

The establishment of a friendly relationship with China was one of the great achievements that Tajikistan had made since its independence nearly 15 years ago, he said in his interview shortly ahead of the summit of the SCO heads of state to be held in Shanghai.

…

He mentioned in particular the opening of the Karasu pass on the Tajik-Chinese border.

“It is an important event in the history of the Tajik-Chinese relations, since it was the first time that the two countries were linked by motor traffic,” Rakhmonov said.

Trade between the two countries was developing rapidly and China’s influence on the Tajik economy was also growing, he said.

The president expressed satisfaction with the Tajik-Chinese trade volume which was increasing every year. In 2005, bilateral trade between the two countries had doubled from the previous year, he said.

…

And finally, if you’ve been following the recent turmoil and elections in Kyrgyzstan, you’d know that things haven’t been looking up for US business and bases over there:

In a surprise result which underscores what remains an extremely divided electorate in Kyrgyzstan, the parliamentary vote has led to the victory of the nationalist Fatherland Party (Ata-Jurt) and a very unclear road to a coalition government.

…

A Fatherland dominated government might bode ill for the Obama Administration’s designs on keeping a military base in Kyrgyzstan, as the party has spoken out against extending the US lease on the base past 2011.

…

Things certainly haven’t been looking up for our MIC, Oil, and related mega companies in that part of the world. And this kind of situation puts our ‘real’ foreign policy makers in their ‘enemies-of-our-enemies’ are needed mode. And when that happens the rest will follow: contracts for our good ole Mujahideen friends, convenient terrorism related incidents and pipeline sabotages right and left, a more aggressive control of the opium trade to finance unwritten-unspoken foreign policy practices …

In the coming days I’ll be posting more updates and brief (not like this one!) commentaries and analysis on this topic, meanwhile, let’s round up our confusing but pretty much on target foreign policy riddle for the post 9/11 decade:

Our competitors’ enemies are our friends. Our nation’s government designated terrorist enemies are willing to become our competitors’ enemies, and that makes them our foreign policymakers’ convenient good friends while they remain our nation’s enemies. And that, my friend, makes our real foreign policy makers our (?)…

I’ll leave the solving and perfection of the above riddle to you. Please keep them coming.

# # # #

Pepe Escobar, Pipelineistan's New Silk Road - China’s Pipelineistan “War” Anteing Up, Betting, and Bluffing in the New Great Game

Future historians may well agree that the twenty-first century Silk Road first opened for business on December 14, 2009. That was the day a crucial stretch of pipeline officially went into operation linking the fabulously energy-rich state of Turkmenistan (via Kazakhstan and Uzbekistan) to Xinjiang Province in China’s far west. Hyperbole did not deter the spectacularly named Gurbanguly Berdymukhamedov, Turkmenistan’s president, from bragging, “This project has not only commercial or economic value. It is also political. China, through its wise and farsighted policy, has become one of the key guarantors of global security.”

The bottom line is that, by 2013, Shanghai, Guangzhou, and Hong Kong will be cruising to ever more dizzying economic heights courtesy of natural gas supplied by the 1,833-kilometer-long Central Asia Pipeline, then projected to be operating at full capacity. And to think that, in a few more years, China’s big cities will undoubtedly also be getting a taste of Iraq’s fabulous, barely tapped oil reserves, conservatively estimated at 115 billion barrels, but possibly closer to 143 billion barrels, which would put it ahead of Iran. When the Bush administration’s armchair generals launched their Global War on Terror, this was not exactly what they had in mind.

China’s economy is thirsty, and so it’s drinking deeper and planning deeper yet. It craves Iraq’s oil and Turkmenistan’s natural gas, as well as oil from Kazakhstan. Yet instead of spending more than a trillion dollars on an illegal war in Iraq or setting up military bases all over the Greater Middle East and Central Asia, China used its state oil companies to get some of the energy it needed simply by bidding for it in a perfectly legal Iraqi oil auction.

Meanwhile, in the New Great Game in Eurasia, China had the good sense not to send a soldier anywhere or get bogged down in an infinite quagmire in Afghanistan. Instead, the Chinese simply made a direct commercial deal with Turkmenistan and, profiting from that country’s disagreements with Moscow, built itself a pipeline which will provide much of the natural gas it needs.

No wonder the Obama administration’s Eurasian energy czar Richard Morningstar was forced to admit at a congressional hearing that the U.S. simply cannot compete with China when it comes to Central Asia’s energy wealth. If only he had delivered the same message to the Pentagon.

That Iranian Equation

In Beijing, they take the matter of diversifying oil supplies very, very seriously. When oil reached $150 a barrel in 2008 -- before the U.S.-unleashed global financial meltdown hit -- Chinese state media had taken to calling foreign Big Oil “international petroleum crocodiles,” with the implication that the West’s hidden agenda was ultimately to stop China’s relentless development dead in its tracks.

Twenty-eight percent of what’s left of the world’s proven oil reserves are in the Arab world. China could easily gobble it all up. Few may know that China itself is actually the world’s fifth largest oil producer, at 3.7 million barrels per day (bpd), just below Iran and slightly above Mexico. In 1980, China consumed only 3% of the world’s oil. Now, its take is around 10%, making it the planet’s second largest consumer. It has already surpassed Japan in that category, even if it’s still way behind the U.S., which eats up 27% of global oil each year. According to the International Energy Agency (IEA), China will account for over 40% of the increase in global oil demand until 2030. And that’s assuming China will grow at “only” a 6% annual rate which, based on present growth, seems unlikely.

Saudi Arabia controls 13% of world oil production. At the moment, it is the only swing producer -- one, that is, that can move the amount of oil being pumped up or down at will -- capable of substantially increasing output. It’s no accident, then, that, pumping 500,000 bpd, it has become one of Beijing’s major oil suppliers. The top three, according to China’s Ministry of Commerce, are Saudi Arabia, Iran, and Angola. By 2013-2014, if all goes well, the Chinese expect to add Iraq to that list in a big way, but first that troubled country’s oil production needs to start cranking up. In the meantime, it’s the Iranian part of the Eurasian energy equation that’s really nerve-racking for China’s leaders.

Chinese companies have invested a staggering $120 billion in Iran's energy sector over the past five years. Already Iran is China’s number two oil supplier, accounting for up to 14% of its imports; and the Chinese energy giant Sinopec has committed an additional $6.5 billion to building oil refineries there. Due to harsh U.N.-imposed and American sanctions and years of economic mismanagement, however, the country lacks the high-tech know-how to provide for itself, and its industrial structure is in a shambles. The head of the National Iranian Oil Company, Ahmad Ghalebani, has publicly admitted that machinery and parts used in Iran’s oil production still have to be imported from China.

Sanctions can be a killer, slowing investment, increasing the cost of trade by over 20%, and severely constricting Tehran’s ability to borrow in global markets. Nonetheless, trade between China and Iran grew by 35% in 2009 to $27 billion. So while the West has been slamming Iran with sanctions, embargos, and blockades, Iran has been slowly evolving as a crucial trade corridor for China -- as well as Russia and energy-poor India. Unlike the West, they are all investing like crazy there because it's easy to get concessions from the government; it's easy and relatively cheap to build infrastructure; and being on the inside when it comes to Iranian energy reserves is a necessity for any country that wants to be a crucial player in Pipelineistan, that contested chessboard of crucial energy pipelines over which much of the New Great Game in Eurasia takes place. Undoubtedly, the leaders of all three countries are offering thanks to whatever gods they care to worship that Washington continues to make it so easy (and lucrative) for them.

Few in the U.S. may know that last year Saudi Arabia -- now (re)arming to the teeth, courtesy of Washington, and little short of paranoid about the Iranian nuclear program -- offered to supply the Chinese with the same amount of oil the country currently imports from Iran at a much cheaper price. But Beijing, for whom Iran is a key long-term strategic ally, scotched the deal.

As if Iran’s structural problems weren’t enough, the country has done little to diversify its economy beyond oil and natural gas exports in the past 30 years; inflation’s running at more than 20%; unemployment at more than 20%; and young, well educated people are fleeing abroad, a major brain drain for that embattled land. And don’t think that’s the end of its litany of problems. It would like to be a full member of the Shanghai Cooperation Organization (SCO) -- the multi-layered economic/military cooperation union that is a sort of Asian response to NATO -- but is only an official SCO observer because the group does not admit any country under U.N. sanctions. Tehran, in other words, would like some great power protection against the possibility of an attack from the U.S. or Israel. As much as Iran may be on the verge of becoming a far more influential player in the Central Asian energy game thanks to Russian and Chinese investment, it’s extremely unlikely that either of those countries would actually risk war against the U.S. to “save” the Iranian regime.

The Great Escape

From Beijing’s point of view, the title of the movie version of the intractable U.S. v. Iran conflict and a simmering U.S. v. China strategic competition in Pipelineistan could be: “Escape from Hormuz and Malacca.”

The Strait of Hormuz is the definition of a potential strategic bottleneck. It is, after all, the only entryway to the Persian Gulf and through it now flow roughly 20% of China’s oil imports. At its narrowest, it is only 36 kilometers wide, with Iran to the north and Oman to the south. China’s leaders fret about the constant presence of U.S. aircraft carrier battle groups on station and patrolling nearby.

With Singapore to the North and Indonesia to the south, the Strait of Malacca is another potential bottleneck if ever there was one -- and through it flow as much as 80% of China’s oil imports. At its narrowest, it is only 54 kilometers wide and like the Strait of Hormuz, its security is also of the made-in-USA variety. In a future face-off with Washington, both straits could quickly be closed or controlled by the U.S. Navy.

Hence, China’s increasing emphasis on developing a land-based Central Asian energy strategy could be summed up as: bye-bye, Hormuz! Bye-bye, Malacca! And a hearty welcome to a pipeline-driven new Silk Road from the Caspian Sea to China’s Far West in Xinjiang.

Kazakhstan has 3% of the world’s proven oil reserves, but its largest oil fields are not far from the Chinese border. China sees that country as a key alternative oil supplier via future pipelines that would link the Kazakh oil fields to Chinese oil refineries in its far west. In fact, China’s first transnational Pipelineistan adventure is already in place: the 2005 China-Kazakhstan oil project, financed by Chinese energy giant CNPC.

Much more is to come, and Chinese leaders expect energy-rich Russia to play a significant part in China’s escape-hatch planning as well. Strategically, this represents a crucial step in regional energy integration, tightening the Russia/China partnership inside the SCO as well as at the U.N. Security Council.

When it comes to oil, the name of the game is the immense Eastern Siberia-Pacific Ocean (ESPO) pipeline. Last August, a 4,000-kilometer-long Russian section from Taishet in eastern Siberia to Nakhodka, still inside Russian territory, was begun. Russian Premier Vladimir Putin hailed ESPO as “a really comprehensive project that has strengthened our energy cooperation.” And in late September, the Russians and the Chinese inaugurated a 999-kilometer-long pipeline from Skovorodino in Russia’s Amur region to the petrochemical hub Daqing in northeast China.

Russia is currently delivering up to 130 million tons of Russian oil a year to Europe. Soon, no less than 50 million tons may be heading to China and the Pacific region as well.

There are, however, hidden tensions between the Russians and the Chinese when it comes to energy matters. The Russian leadership is understandably wary of China’s startling strides in Central Asia, the former Soviet Union’s former “near abroad.” After all, as the Chinese have been doing in Africa in their search for energy, in Central Asia, too, the Chinese are building railways and introducing high-tech trains, among other modern wonders, in exchange for oil and gas concessions.

Despite the simmering tensions between China, Russia, and the U.S., it’s too early to be sure just who is likely to emerge as the victor in the new Great Game in Central Asia, but one thing is clear enough. The Central Asian “stans” are becoming ever more powerful poker players in their own right as Russia tries not to lose its hegemony there, Washington places all its chips on pipelines meant to bypass Russia (including the Baku-Tbilisi-Ceyhan (BTC) pipeline that pumps oil from Azerbaijan to Turkey via Georgia) and China antes up big time for its Central Asian future. Whoever loses, this is a game that the “stans” cannot but profit from.

Recently, our man Gurbanguly, the Turkmen leader, chose China as his go-to country for an extra $4.18 billion loan for the development of South Yolotan, his country’s largest gas field. (The Chinese had already shelled out $3 billion to help develop it.) Energy bureaucrats in Brussels were devastated. With estimated reserves of up to 14 trillion cubic meters of natural gas, the field has the potential to flood the energy-starved European Union with gas for more than 20 years. Goodbye to all that?

In 2009, Turkmenistan’s proven gas reserves were estimated at a staggering 8.1 trillion cubic meters, fourth largest in the world after Russia, Iran, and Qatar. Not surprisingly, from the point of view of Ashgabat, the country’s capital, it invariably seems to be raining gas. Nonetheless, experts doubt that the landlocked, idiosyncratic Central Asian republic actually has enough blue gold to supply Russia (which absorbed 70% of Turkmenistan’s supply before the pipeline to China opened), China, Western Europe and Iran, all at the same time.

Currently, Turkmenistan sells its gas to: China via the world's largest gas pipeline, 7,000 kilometers long and designed for a capacity of 40 billion cubic meters per year, Russia (10 billion cubic meters per year, down from 30 billion per year until 2008), and Iran (14 billion cubic meters per year). Iranian President Mahmoud Ahmadinejad always gets a red-carpet welcome from Gurbanguly, and the Russian energy giant Gazprom, thanks to an improved pricing policy, is treated as a preferred customer.

At present, however, the Chinese are atop the heap, and more generally, whatever happens, there can be little question that Central Asia will be China’s major foreign supplier of natural gas. On the other hand, the fact that Turkmenistan has, in practice, committed its entire future gas exports to China, Russia, and Iran means the virtual death of various trans-Caspian Sea pipeline plans long favored by Washington and the European Union.

IPI vs. TAPI All Over Again

On the oil front, even if all the “stans” sold China every barrel of oil they currently pump, less than half of China’s daily import needs would be met. Ultimately, only the Middle East can quench China’s thirst for oil. According to the International Energy Agency, China’s overall oil needs will rise to 11.3 million barrels per day by 2015, even with domestic production peaking at 4.0 million bpd. Compare that to what some of China’s alternative suppliers are now producing: Angola, 1.4 million bpd; Kazakhstan, 1.4 million as well; and Sudan, 400,000.

On the other hand, Saudi Arabia produces 10.9 million bpd, Iran around 4.0 million, the United Arab Emirates (UAE) 3.0 million, Kuwait 2.7 million -- and then there’s Iraq, presently at 2.5 million and likely to reach at least 4.0 million by 2015. Still, Beijing has yet to be fully convinced that this is a safe supply, especially given all those U.S. “forward operating sites” in the UAE, Bahrain, Kuwait, Qatar, and Oman, plus those roaming naval battle groups in the Persian Gulf.

On the gas front, China definitely counts on a South Asian game changer. Beijing has already spent $200 million on the first phase in the construction of a deepwater port at Gwadar in Pakistan’s Balochistan Province. It wanted, and got from Islamabad, “sovereign guarantees to the port’s facilities.” Gwadar is only 400 kilometers from Hormuz. With Gwadar, the Chinese Navy would have a homeport that would easily allow it to monitor traffic in the strait and someday perhaps even thwart the U.S. Navy’s expansionist designs in the Indian Ocean.

But Gwadar has another infinitely juicier future role. It could prove the pivot in a competition between two long-discussed pipelines: TAPI and IPI. TAPI stands for the Turkmenistan-Afghanistan-Pakistan-India pipeline, which can never be built as long as U.S. and NATO occupation forces are fighting the resistance umbrella conveniently labeled “Taliban” in Afghanistan. IPI, however, is the Iran-Pakistan-India pipeline, also known as the “peace pipeline” (which, of course, would make TAPI the “war pipeline”). To Washington’s immeasurable distress, last June, Iran and Pakistan finally closed the deal to build the “IP” part of IPI, with Pakistan assuring Iran that either India or China could later be brought into the project.

Whether it’s IP, IPI, or IPC, Gwadar will be a key node. If, under pressure from Washington, which treats Tehran like the plague, India is forced to pull out of the project, China already has made it clear that it wants in. The Chinese would then build a Pipelineistan link from Gwadar along the Karakorum highway in Pakistan to China via the Khunjerab Pass -- another overland corridor that would prove immune to U.S. interference. It would have the added benefit of radically cutting down the 20,000-kilometer-long tanker route around the southern rim of Asia.

Arguably, for the Indians it would be a strategically sound move to align with IPI, trumping a deep suspicion that the Chinese will move to outflank them in the search for foreign energy with a “string of pearls” strategy: the setting up of a series of “home ports” along its key oil supply routes from Pakistan to Myanmar. In that case, Gwadar would no longer simply be a “Chinese” port.

As for Washington, it still believes that if TAPI is built, it will help keep India from fully breaking the U.S.-enforced embargo on Iran. Energy-starved Pakistan obviously prefers its “all-weather” ally China, which might commit itself to building all sorts of energy infrastructure within that flood-devastated country. In a nutshell, if the unprecedented energy cooperation between Iran, Pakistan, and China goes forward, it will signal a major defeat for Washington in the New Great Game in Eurasia, with enormous geopolitical and geo-economic repercussions.

For the moment, Beijing’s strategic priority has been to carefully develop a remarkably diverse set of energy-suppliers -- a flow of energy that covers Russia, the South China Sea, Central Asia, the East China Sea, the Middle East, Africa, and South America. (China’s forays into Africa and South America will be dealt with in a future installment of our TomDispatch tour of the globe's energy hotspots.) If China has so far proven masterly in the way it has played its cards in its Pipelineistan “war”, the U.S. hand -- bypass Russia, elbow out China, isolate Iran -- may soon be called for what it is: a bluff.

Pepe Escobar is the roving correspondent for Asia Times. His latest book is Obama Does Globalistan. He may be reached at pepeasia@yahoo.com.

Copyright 2010 Pepe Escobar

THE ROVING EYE Pipelineistan goes Iran-Pak By Pepe Escobar

The earth has been shaking for a few days now all across Pipelineistan - with massive repercussions for all the big players in the New Great Game in Eurasia. United States President Barack Obama's AfPak strategists didn't even see it coming.

A silent, reptilian war had been going on for years between the US-favored Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline and its rival, the Iran-Pakistan-India (IPI) pipeline, also known as the "peace pipeline". This past weekend, a winner emerged. And it's none of the above: instead, it's the 2,100-kilometer, US$7.5 billion IP (the Iran-Pakistan pipeline), with no India attached. (Please see Pakistan, Iran sign gas pipeline deal, May 27, 2009, Asia Times Online.)

This whole saga started way back in 1995 - about the time California-based Unocal started floating the idea of building a pipeline crossing Afghanistan. Now, Iran and Pakistan finally signed a deal this week in Tehran, by which Iran will sell gas from its mega South Pars fields to Pakistan for the next 25 years.

According to Iranian energy officials speaking to the ISNA news agency, the final deal will be signed in less than three weeks, slightly after the first round of the Iranian presidential election. The last 250 km of a 900-km pipeline stretch in Iran between Asalouyeh and Iranshahr, near the border with Pakistan, still needs to be built. The whole IP pipeline should be operational by 2014.

The fact that Islamabad has finally decided to move on is pregnant with meaning. For the George W Bush administration IPI was simply anathema; imagine India and Pakistan buying gas from "axis of evil" Iran. The only way to go was TAPI - an extension of the childish neo-conservative belief that the Afghanistan war was winnable.

Now, IP reveals Islamabad's own interests seemed to have prevailed against Washington's (unlike the virtually US-imposed Pakistan army offensive against the Taliban in the Swat Valley). The Barack Obama administration has been mum about IP so far. But it will be very enlightening to hear what former Bush pet Afghan Zalmay Khalilzad - who's been infiltrating himself as the next CEO of Afghanistan - has to say about it. (Please see Slouching towards Balkanization, May 22, 2009, Asia Times Online.) Khalilzad's Pipelineistan dream, since the mid-1990s, has always been a trans-Afghan pipeline capable of bypassing both Iran and Russia.

IP, IP, hurrah
India, for a number of reasons (the pricing system, transit fees and above all, security) de facto shelved the IPI idea last year. Had it not been the case, IPI would become a powerful vector in terms of South Asian regional integration - doing more to stabilize India-Pakistan relations than any diplomatic coup. Nevertheless, both Iran and Pakistan still have left an open door to India.

India's (momentary?) loss will be China's gain. Since 2008, with New Delhi having second thoughts, Beijing and Islamabad had set up an agreement - China would import most of this Iranian gas if India dropped out of IPI. China anyway is more than welcome business-wise to both Iran and Pakistan. Only in transit fees, Islamabad could collect as much as $500 million a year.

For Beijing, IP could not be more essential. Iranian gas will flow to the Balochistan province port of Gwadar, in the Arabian Sea (which China itself built, and where it is also building a refinery). And Gwadar is supposed to be connected to a proposed pipeline going north, mostly financed by China, along the Karakoram Highway (which by the way was largely built from the 1960s to the 1980s by Chinese engineers ... ).

Pakistan is the absolutely ideal transit corridor for China to import oil and gas from Iran and the Persian Gulf. With IP in place and with multi-billion-dollar, overlapping Tehran-Beijing gas deals, China can finally afford to import less energy via the Strait of Malacca, which Beijing considers exceedingly dangerous, and subject to Washington's sphere of influence.

With IP, not only China wins; Russia's Gazprom also wins. And by extension, the Shanghai Cooperation Organization (SCO) wins. Russian deputy Energy Minister Anatoly Yankovsky told the Kommersant business daily, "We are ready to join the project as soon as we receive an offer."

The reason is so blatant that Gazprom officials have not even bothered to disguise it. For Russia, IP is a gift-from-above tool in rerouting gas from Iran to South Asia, and away from competing with Russian gas. The big prize, in this case, is the Western European market, dependent almost 30% on Gazprom and the source of 80% of Gazprom's export profits.

The European Union is desperately trying to keep the Nabucco pipeline project - which bypasses Russia - afloat, so it may reduce its dependence on Gazprom. But as anyone in Brussels knows, Nabucco can only work if it is provided enough gas by either Iran or Turkmenistan. The Turkmenistan distribution system is controlled by Russia. And a deal with Iran implies no more US sanctions - still a long way away. With IP in place, Gazprom reasons, Nabucco is deprived of a key supply source.

All eyes on Balochistan
With IP firmly in place, the strategic spotlight focuses even more on Balochistan. (Please see Balochistan is the greatest prize, May 9, 2009, Asia Times Online.) First of all, there's an internal Pakistani question to be settled. An editorial in the Pakistani daily Dawn has stressed how Islamabad must be serious about hiring indigenous Balochi labor and making sure "the gains of the economic activity ... are focused on Balochistan for the benefit of its poverty-stricken people".

The port of Gwadar, in southwest Balochistan, near the Iranian border, is indeed bound to become a new Dubai - but not the way the vice president Dick Cheney and gang in Washington once dreamed of. Gas from the South Pars fields in Iran will definitely flow though it. As for gas from the Daulatabad fields in Turkmenistan, assuming TAPI ever gets built though war-torn Afghanistan, that's much more unlikely.

This all raises the crucial question: how will Islamabad deal with ultra-strategic Balochistan - east of Iran, south of Afghanistan, and boasting three Arabian sea ports, including Gwadar, practically at the mouth of the Strait of Hormuz?

The New Great Game in Eurasia rules that Pakistan is a key pivot to both North Atlantic Treaty Organization (NATO) and the SCO, of which Pakistan is an observer. Balochistan de facto incorporates Pakistan as a key transit corridor to Iranian gas from the monster South Pars fields, and not to a great deal of the Caspian wealth of "gas republic" Turkmenistan. For the Pentagon, the birth of IP is mega bad news. The ideal Pentagon scenario is the US controlling Gwadar - in yet one more prime confluence of Pipelineistan and the US Empire of Bases.

With Gwadar directly linked to Iran and developed virtually as a Chinese warehouse, the Pentagon also loses the mouth-watering opportunity of a long land route across Balochistan into Helmand, Nimruz, Kandahar or, better yet, all of these three provinces in southwest Afghanistan, where soon, not by accident, there will be another US mega-base in the "desert of death". From a Pentagon/NATO perspective, after the "loss" of the Khyber Pass, that would be the ideal supply route for Western troops in the perennial, now rebranded, GWOT ("global war on terror").

Balochis surging
Islamabad has promised an all-parties conference "within days" to seriously deal with Balochistan. No one is holding their breath. Over a year ago, Balochistan was promised greater control over its immense natural resources - the undisputed, number-one Baloch grievance - and a massive aid package. Not much has happened.

Punjabis derisively refer to Balochistan's "backwardness". But the heart of the matter is systematic, hardcore pillage by Islamabad - combined with hardcore repression and serial Latin America-in-the-1970s-style "disappearances" of political activists and senior Baloch nationalists. Not to mention virtually no investment in health, education and job creation. This Third World dictatorship catalogue of disasters fuels Baloch nationalism and separatism.

Islamabad's paranoia is "foreign involvement" in the different strands of Balochistan's nationalist movements. That would be, in fact, the CIA, MI5 and the Israeli Mossad, all engaged in overlapping agendas which manipulate Balochistan for balkanization of Pakistan purposes and/or as a base for the destabilization of neighboring Iran's southeast. While the Taliban, Afghan or Pakistani, can roam free across Balochistan, Baloch nationalists are intimidated, harassed and killed.

Sanaullah Baloch, a secretary of the Balochistan National Party-Mengal, told Dawn how "several Baloch political parties tried to file charges against [former president General Pervez] Musharraf, but the country's institutions lack the will or courage to accept our plea against him." Studies show that rural poverty in Balochistan when Musharraf was in power increased 15% between 1999 and 2005.

Sanaullah Baloch roundly denounces the "civil-military elites" of Pakistan as implicated in the systematic repression going on in Balochistan; "Without their consent, no political regime can undo their policy of continued suppression."

And his analysis of why Islamabad has made a deal with the Taliban in Swat but won't do a deal with Balochis could not be more enlightening: "The establishment in Pakistan has always felt comfortable with religious groups as they do not challenge the centralized authority of the civil-military establishment. The demands of these groups are not political. They don't demand economic parity. They demand centralized religious rule which is philosophically closer to the establishment's version of totalitarianism. Islamabad's elite are stubborn against genuine Baloch demands: governing Balochistan, having ownership of resources, and control over provincial security."

So Islamabad still has all it takes to royally mess up what it has accomplished by approving IP. For the moment, Iran, Pakistan, China and Russia win. The SCO wins. Washington and NATO lose, not to mention Afghanistan (no transit fees). But will Balochistan also win? If not, all hell will break loose, from desperate Balochis sabotaging IP to "foreign interference" manipulating them into creating an even greater, regional, ball of fire.

Pepe Escobar is the author of Globalistan: How the Globalized World is Dissolving into Liquid War (Nimble Books, 2007) and Red Zone Blues: a snapshot of Baghdad during the surge. His new book, just out, is Obama does Globalistan (Nimble Books, 2009).

He may be reached at pepeasia@yahoo.com.

Liquid War - Postcard from Pipelineistan By Pepe Escobar

Liquid War

Postcard from Pipelineistan
By Pepe Escobar

What happens on the immense battlefield for the control of Eurasia will provide the ultimate plot line in the tumultuous rush towards a new, polycentric world order, also known as the New Great Game.

Our good ol' friend the nonsensical "Global War on Terror," which the Pentagon has slyly rebranded "the Long War," sports a far more important, if half-hidden, twin -- a global energy war. I like to think of it as the Liquid War, because its bloodstream is the pipelines that crisscross the potential imperial battlefields of the planet. Put another way, if its crucial embattled frontier these days is the Caspian Basin, the whole of Eurasia is its chessboard. Think of it, geographically, as Pipelineistan.

All geopolitical junkies need a fix. Since the second half of the 1990s, I've been hooked on pipelines. I've crossed the Caspian in an Azeri cargo ship just to follow the $4 billion Baku-Tblisi-Ceyhan pipeline, better known in this chess game by its acronym, BTC, through the Caucasus. (Oh, by the way, the map of Pipelineistan is chicken-scratched with acronyms, so get used to them!)

I've also trekked various of the overlapping modern Silk Roads, or perhaps Silk Pipelines, of possible future energy flows from Shanghai to Istanbul, annotating my own DIY routes for LNG (liquefied natural gas). I used to avidly follow the adventures of that once-but-not-future Sun-King of Central Asia, the now deceased Turkmenbashi or "leader of the Turkmen," Saparmurat Niyazov, head of the immensely gas-rich Republic of Turkmenistan, as if he were a Conradian hero.

In Almaty, the former capital of Kazakhstan (before it was moved to Astana, in the middle of the middle of nowhere) the locals were puzzled when I expressed an overwhelming urge to drive to that country's oil boomtown Aktau. ("Why? There's nothing there.") Entering the Space Odyssey-style map room at the Russian energy giant Gazprom's headquarters in Moscow -- which digitally details every single pipeline in Eurasia -- or the National Iranian Oil Company (NIOC)'s corporate HQ in Tehran, with its neat rows of female experts in full chador, was my equivalent of entering Aladdin's cave. And never reading the words "Afghanistan" and "oil" in the same sentence is still a source of endless amusement for me.

Last year, oil cost a king's ransom. This year, it's relatively cheap. But don't be fooled. Price isn't the point here. Like it or not, energy is still what everyone who's anyone wants to get their hands on. So consider this dispatch just the first installment in a long, long tale of some of the moves that have been, or will be, made in the maddeningly complex New Great Game, which goes on unceasingly, no matter what else muscles into the headlines this week.

Forget the mainstream media's obsession with al-Qaeda, Osama "dead or alive" bin Laden, the Taliban -- neo, light or classic -- or that "war on terror," whatever name it goes by. These are diversions compared to the high-stakes, hardcore geopolitical game that follows what flows along the pipelines of the planet.

Who said Pipelineistan couldn't be fun?

Calling Dr. Zbig

In his 1997 magnum opus The Grand Chessboard, Zbigniew Brzezinski -- realpolitik practitioner extraordinaire and former national security advisor to Jimmy Carter, the president who launched the U.S. on its modern energy wars -- laid out in some detail just how to hang on to American "global primacy." Later, his master plan would be duly copied by that lethal bunch of Dr. No's congregated at Bill Kristol's Project for a New American Century (PNAC, in case you'd forgotten the acronym since its website and its followers went down).

For Dr. Zbig, who, like me, gets his fix from Eurasia -- from, that is, thinking big -- it all boils down to fostering the emergence of just the right set of "strategically compatible partners" for Washington in places where energy flows are strongest. This, as he so politely put it back then, should be done to shape "a more cooperative trans-Eurasian security system."

By now, Dr. Zbig -- among whose fans is evidently President Barack Obama -- must have noticed that the Eurasian train which was to deliver the energy goods has been slightly derailed. The Asian part of Eurasia, it seems, begs to differ.

Global financial crisis or not, oil and natural gas are the long-term keys to an inexorable transfer of economic power from the West to Asia. Those who control Pipelineistan -- and despite all the dreaming and planning that's gone on there, it's unlikely to be Washington -- will have the upper hand in whatever's to come, and there's not a terrorist in the world, or even a long war, that can change that.

Energy expert Michael Klare has been instrumental in identifying the key vectors in the wild, ongoing global scramble for power over Pipelineistan. These range from the increasing scarcity (and difficulty of reaching) primary energy supplies to "the painfully slow development of energy alternatives." Though you may not have noticed, the first skirmishes in Pipelineistan's Liquid War are already on, and even in the worst of economic times, the risk mounts constantly, given the relentless competition between the West and Asia, be it in the Middle East, in the Caspian theater, or in African oil-rich states like Angola, Nigeria and Sudan.

In these early skirmishes of the twenty-first century, China reacted swiftly indeed. Even before the attacks of 9/11, its leaders were formulating a response to what they saw as the reptilian encroachment of the West on the oil and gas lands of Central Asia, especially in the Caspian Sea region. To be specific, in June 2001, its leaders joined with Russia's to form the Shanghai Cooperation Organization. It's known as the SCO and that's an acronym you should memorize. It's going to be around for a while.

Back then, the SCO's junior members were, tellingly enough, the Stans, the energy-rich former SSRs of the Soviet Union -- Kyrgyzstan, Uzbekistan, Kazakhstan, and Tajikistan -- which the Clinton administration and then the new Bush administration, run by those former energy men, had been eyeing covetously. The organization was to be a multi-layered economic and military regional cooperation society that, as both the Chinese and the Russians saw it, would function as a kind of security blanket around the upper rim of Afghanistan.

Iran is, of course, a crucial energy node of West Asia and that country's leaders, too, would prove no slouches when it came to the New Great Game. It needs at least $200 billion in foreign investment to truly modernize its fabulous oil and gas reserves -- and thus sell much more to the West than U.S.-imposed sanctions now allow. No wonder Iran soon became a target in Washington. No wonder an air assault on that country remains the ultimate wet dream of assorted Likudniks as well as Dick ("Angler") Cheney and his neocon chamberlains and comrades-in-arms. As seen by the elite from Tehran and Delhi to Beijing and Moscow, such a U.S. attack, now likely off the radar screen until at least 2012, would be a war not only against Russia and China, but against the whole project of Asian integration that the SCO is coming to represent.

Global BRIC-a-brac

Meanwhile, as the Obama administration tries to sort out its Iranian, Afghan, and Central Asian policies, Beijing continues to dream of a secure, fast-flowing, energy version of the old Silk Road, extending from the Caspian Basin (the energy-rich Stans plus Iran and Russia) to Xinjiang Province, its Far West.

The SCO has expanded its aims and scope since 2001. Today, Iran, India, and Pakistan enjoy "observer status" in an organization that increasingly aims to control and protect not just regional energy supplies, but Pipelineistan in every direction. This is, of course, the role the Washington ruling elite would like NATO to play across Eurasia. Given that Russia and China expect the SCO to play a similar role across Asia, clashes of various sorts are inevitable.

Ask any relevant expert at the Chinese Academy of Social Sciences in Beijing and he will tell you that the SCO should be understood as a historically unique alliance of five non-Western civilizations -- Russian, Chinese, Muslim, Hindu, and Buddhist -- and, because of that, capable of evolving into the basis for a collective security system in Eurasia. That's a thought sure to discomfort classic inside-the-Beltway global strategists like Dr. Zbig and President George H. W. Bush's national security advisor Brent Scowcroft.

According to the view from Beijing, the rising world order of the twenty-first century will be significantly determined by a quadrangle of BRIC countries -- for those of you by now collecting Great Game acronyms, that stands for Brazil, Russia, India, and China -- plus the future Islamic triangle of Iran, Saudi Arabia, and Turkey. Add in a unified South America, no longer in thrall to Washington, and you have a global SCO-plus. On the drawing boards, at least, it's a high octane dream.

The key to any of this is a continuing Sino-Russian entente cordiale.

Already in 1999, watching NATO and the United States aggressively expand into the distant Balkans, Beijing identified this new game for what it was: a developing energy war. And at stake were the oil and natural gas reserves of what Americans would soon be calling the "arc of instability," a vast span of lands extending from North Africa to the Chinese border. No less important would be the routes pipelines would take in bringing the energy buried in those lands to the West. Where they would be built, the countries they would cross, would determine much in the world to come. And this was where the empire of U.S. military bases (think, for instance, Camp Bondsteel in Kosovo) met Pipelineistan (represented, way back in 1999, by the AMBO pipeline).

AMBO, short for Albanian Macedonian Bulgarian Oil Corporation, an entity registered in the U.S., is building a $1.1 billion pipeline, aka "the Trans-Balkan," slated to be finished by 2011. It will bring Caspian oil to the West without taking it through either Russia or Iran. As a pipeline, AMBO fit well into a geopolitical strategy of creating a U.S.-controlled energy-security grid that was first developed by President Bill Clinton's Energy Secretary Bill Richardson and later by Vice President Dick Cheney.

Behind the idea of that "grid" lay a go-for-broke militarization of an energy corridor that would stretch from the Caspian Sea in Central Asia through a series of now independent former SSRs of the Soviet Union to Turkey, and from there into the Balkans (thence on to Europe). It was meant to sabotage the larger energy plans of both Russia and Iran. AMBO itself would bring oil from the Caspian basin to a terminal in the former SSR of Georgia in the Caucasus, and then transport it by tanker through the Black Sea to the Bulgarian port of Burgas, where another pipeline would connect to Macedonia and then to the Albanian port of Vlora.

As for Camp Bondsteel, it was the "enduring" military base that Washington gained from the wars for the remains of Yugoslavia. It would be the largest overseas base the U.S. had built since the Vietnam War. Halliburton's subsidiary Kellogg Brown & Root (KBR) would, with the Army Corps of Engineers, put it up on 400 hectares of farmland near the Macedonian border in southern Kosovo. Think of it as a user-friendly, five-star version of Guantanamo with perks for those stationed there that included Thai massage and loads of junk food. Bondsteel is the Balkan equivalent of a giant immobile aircraft carrier, capable of exercising surveillance not only over the Balkans but also over Turkey and the Black Sea region (considered in the neocon-speak of the Bush years "the new interface" between the "Euro-Atlantic community" and the "Greater Middle East").

How could Russia, China, and Iran not interpret the war in Kosovo, then the invasion of Afghanistan (where Washington had previously tried to pair with the Taliban and encourage the building of another of those avoid-Iran, avoid-Russia pipelines), followed by the invasion of Iraq (that country of vast oil reserves), and finally the recent clash in Georgia (that crucial energy transportation junction) as straightforward wars for Pipelineistan? Though seldom imagined this way in our mainstream media, the Russian and Chinese leaderships saw a stark "continuity" of policy stretching from Bill Clinton's humanitarian imperialism to Bush's Global War on Terror. Blowback, as then Russian President Vladimir Putin himself warned publicly, was inevitable -- but that's another magic-carpet story, another cave to enter another time.

Rainy Night in Georgia

If you want to understand Washington's version of Pipelineistan, you have to start with Mafia-ridden Georgia. Though its army was crushed in its recent war with Russia, Georgia remains crucial to Washington's energy policy in what, by now, has become a genuine arc of instability -- in part because of a continuing obsession with cutting Iran out of the energy flow.

It was around the Baku-Tblisi-Ceyhan (BTC) pipeline, as I pointed out in my book Globalistan in 2007, that American policy congealed. Zbig Brzezinski himself flew into Baku in 1995 as an "energy consultant," less than four years after Azerbaijan became independent, and sold the idea to the Azerbaijani elite. The BTC was to run from the Sangachal Terminal, half-an-hour south of Baku, across neighboring Georgia to the Marine Terminal in the Turkish port of Ceyhan on the Mediterranean. Now operational, that 1,767-kilometer-long, 44-meter-wide steel serpent straddles no less than six war zones, ongoing or potential: Nagorno-Karabakh (an Armenian enclave in Azerbaijan), Chechnya and Dagestan (both embattled regions of Russia), South Ossetia and Abkhazia (on which the 2008 Russia-Georgia war pivoted), and Turkish Kurdistan.

From a purely economic point of view, the BTC made no sense. A "BTK" pipeline, running from Baku through Tehran to Iran's Kharg Island, could have been built for, relatively speaking, next to nothing -- and it would have had the added advantage of bypassing both mafia-corroded Georgia and wobbly Kurdish-populated Eastern Anatolia. That would have been the really cheap way to bring Caspian oil and gas to Europe.

The New Great Game ensured that that was not to be, and much followed from that decision. Even though Moscow never planned to occupy Georgia long-term in its 2008 war, or take over the BTC pipeline that now runs through its territory, Alfa Bank oil and gas analyst Konstantin Batunin pointed out the obvious: by briefly cutting off the BTC oil flow, Russian troops made it all too clear to global investors that Georgia wasn't a reliable energy transit country. In other words, the Russians made a mockery of Zbig's world.

For its part, Azerbaijan was, until recently, the real success story in the U.S. version of Pipelineistan. Advised by Zbig, Bill Clinton literally "stole" Baku from Russia's "near abroad" by promoting the BTC and the wealth that would flow from it. Now, however, with the message of the Russia-Georgia War sinking in, Baku is again allowing itself to be seduced by Russia. To top it off, Azerbaijan President Ilham Aliyev can't stand Georgia's brash President Mikhail Saakashvili. That's hardly surprising. After all, Saakashvili's rash military moves caused Azerbaijan to lose at least $500 million when the BTC was shut down during the war.

Russia's energy seduction blitzkrieg is focused like a laser on Central Asia as well. (We'll talk about it more in the next Pipelineistan installment.) It revolves around offering to buy Kazakh, Uzbek, and Turkmen gas at European prices instead of previous, much lower Russian prices. The Russians, in fact, have offered the same deal to the Azeris: so now, Baku is negotiating a deal involving more capacity for the Baku-Novorossiysk pipeline, which makes its way to the Russian borders of the Black Sea, while considering pumping less oil for the BTC.

President Obama needs to understand the dire implications of this. Less Azeri oil on the BTC -- its full capacity is 1 million barrels a day, mostly shipped to Europe -- means the pipeline may go broke, which is exactly what Russia wants.

In Central Asia, some of the biggest stakes revolve around the monster Kashagan oil field in "snow leopard" Kazakhstan, the absolute jewel in the Caspian crown with reserves of as many as 9 billion barrels. As usual in Pipelineistan, it all comes down to which routes will deliver Kashagan's oil to the world after production starts in 2013. This spells, of course, Liquid War. Wily Kazakh President Nursultan Nazarbayev would like to use the Russian-controlled Caspian Pipeline Consortium (CPC) to pump Kashagan crude to the Black Sea.

In this case, the Kazakhs hold all the cards. How oil will flow from Kashagan will decide whether the BTC -- once hyped by Washington as the ultimate Western escape route from dependence on Persian Gulf oil -- lives or dies.

Welcome, then, to Pipelineistan! Whether we like it or not, in good times and bad, it's a reasonable bet that we're all going to be Pipeline tourists. So, go with the flow. Learn the crucial acronyms, keep an eye out for what happens to all those U.S. bases across the oil heartlands of the planet, watch where the pipelines are being built, and do your best to keep tabs on the next set of monster Chinese energy deals and fabulous coups by Russia's Gazprom.

And, while you're at it, consider this just the first postcard sent off from our tour of Pipelineistan. We'll be back (to slightly adapt a quote from the Terminator). Think of this as a door opening onto a future in which what flows where and to whom may turn out to be the most important question on the planet.

Pepe Escobar is the roving correspondent for Asia Times and an analyst for the Real News. This article draws from his new book, Obama does Globalistan. He may be reached at pepeasia@yahoo.com.

Copyright 2009 Pepe Escobar