We turn back to the dictator's playbook. As you recall, we've identified the two general options in the dictator's playbook against an uprising -- the Shevardnadze play, referring to the decision by Georgia's Eduard Shevardnadze to step down in the face of massive 2003 protests in his country; and the Karimov play, referring to the calculus of Uzbekistan's Islam Karimov, who in 2005 gunned down hundreds of protesters in the city of Andijan. After weeks of Shevardnadze holding the advantage in the fervor of protests engulfing the Middle East, we see a decided shift in favor of the Karimov play. In Bahrain, Libya and Saudi Arabia, in addition to Azerbaijan and Uzbekistan, autocrats have rejected the example of Tunisia and Egypt (the Shevardnadze play), and are now flouting any obloquy of jailing, attacking or killing protesters in order to keep power.
The shift suggests that, while dictators may have to elevate their game in what had appeared to be a turbulent but politically rigid region, there may be much less immediate change than initially seemed possible.
In Libya, with the United States now backing the establishment of a no-fly zone, the situation could turn around yet again, that is if Col. Muammar al-Qaddafi's forces do not consolidate their rolling triumph before any outside intervention. In the video below, Saif al-Islam (pictured above), the Qaddafi son previously much-heralded in Great Britain, predicts that his father's forces will capture the rebel stronghold of Benghazi "within 48 hours." If that happens -- which at this point would be the betting outcome -- this chapter of the Libyan uprising would be over. Given Qaddafi's remarks in recent weeks, there could be a bloodbath.
Mahmud Turkia AFP/Getty Images
A RAND Institute researcher has stirred up the green-energy edifice with a report concluding that clean fuels have little military value, and that the U.S. service branches are wasting millions of dollars by trying to replace their consumption of fossil fuels. The author, James Bartis, says agricultural products such as camelina will never produce much fuel, and that algae may but not for another decade or 15 years. The takeaway, says Bartis -- find out if there is a national strategic reason to get off oil, but don't look for it in the military.
That raised the hackles of the biofuels industry. The Algal Biomass Organization called the report "flawed." Tom Hicks, deputy assistant secretary of the Navy, asserted that Bartis didn't do the usual good RAND job, reports DoD Buzz.
There is a problem with Bartis's report, but not that it's inaccurate -- it isn't, which I figured out in a phone conversation with him last evening. The problem is that the folks who ordered up the report -- Congress -- asked an incomplete question. The result? Bartis's report is misleading by omission. His report focuses solely on non-fossil fuels, as Congress requested in a 2009 appropriations bill, and leaves out alternative energy such as solar and fuel cells. But the U.S. Army and DARPA, the super-secret military invention lab, have been developing the latter two for a surpassing military strategic goal -- to reduce the number of soldiers killed and maimed by roadside bombs while they guard serpentine fuel convoys into Iraq and Afghanistan.
"We were asked to look at liquid fuels," Bartis told me. "But if you need electricity," and it were cost-effective, "photo-voltaics would be a good option."
Fourteen years ago, I walked up to the Pakistani Embassy in the western Afghan city of Herat, and asked the chowkidar to relay my Newsweek business card to the consul general. I don't recall what precisely I had scrawled on the card, but whatever it was, a few moments later, I was led into a drawing room in which, behind a desk, a man with a beautifully combed, flowing gray beard, a white cap, and a sparkling white shalwar kameez was shouting into a phone in a mixture of Pashto and English. It was something about not to worry, that he would arrange relief troops or supplies, and generally just to hold on. Then Sultan Amir hung up the phone, and, flashing a gorgeous white smile, offered a hand. "Welcome, my brother," he said.
So began the first of two meetings with the elusive Amir, otherwise known as Col. Imam, a Fort Bragg-trained teacher and champion of the Taliban, for a story on the origins of the Taliban a year after they took power. Amir's death was confirmed by Pakistani authorities yesterday. The former Pakistani intelligence officer had spent the last 10 months as a captive of a young, ultra-radical mutant strain of the Taliban after wandering into North Waziristan with a local journalist, clearly expecting the respectful treatment he had enjoyed for some three decades among Afghan militants.
If Amir's death symbolizes something, it is perhaps a cautionary bookend to the long, romantic period in which Pakistan cultivated, influenced and often heavily controlled Afghanistan's loosely organized fighting bands as part of its strategy to contain Indian influence. Amir did not realize that that world is largely gone. Neither did Khalid Khawaja, another Pakistani intelligence officer who accompanied Amir on the trip; his body was found by the side of a road a month after both were abducted last March.
Afghanistan has always been a place that gets outsiders caught up in their imagination. In the case of Amir, he was locked into the early days of the Taliban in the mid-1990s. For other foreigners, the romantic fixation goes much further back - to the Silk Road, the legendary transportation network that crossed from west to east, and was immortalized by the life of Marco Polo in the 13th century. Just mention the Silk Road to some folks, and you are guaranteed to get them teary-eyed. The latter would be the case for a Johns Hopkins professor named Fred Starr, and some senior U.S. Army Central Command generals who have embraced his vision of a resurrected Silk Road as a way to bring ultimate peace to Afghanistan.
The last time we heard from Russell Zanca, a Central Asia expert at Northeastern Illinois University, he was reporting on the failures of Uzbek President Islam Karimov. Here Zanca suggests where the United States should go from here.
-- Steve LeVine
For some two years, U.S. diplomatic efforts in Uzbekistan have been oriented toward ensuring that the Uzbeks allow the U.S. military to transport all manner of supplies to Afghanistan safely and cheaply, an alternative to poorly safeguarded routes through Pakistan. As a result, the United States is loath to complain of the Uzbek regime's continued cruel behavior toward its population -- if it does, the risk is that President Islam Karimov, as he did in 2005, asks the United States to leave his country.
If the United States were expelled, would we completely compromise our effectiveness in Afghanistan? Alternative supply routes are few: Turkmenistan has the most to offer in terms of geography and terrain, but the United States has never enjoyed ideal relations with the Turkmen, who make matters difficult with their official policy of "neutrality." Tajikistan is also impractical -- infrastructure such as railroads and roads are undeveloped, its mountains are in the way, and it has too many Russian troops on its soil. With Uzbekistan, the U.S. trades one tyranny for another -- liberating the Afghans while leaving the Uzbeks at the mercy of Karimov -- but it also gets an excellent road-and-railroad network between Termez and Mazar-i-Sharif, along with friendly relations with the Uzbeks of northern Afghanistan.
DENIS SINYAKOV/AFP/Getty Images
One of our most prevalent current canards is the mantra that we must "get off foreign oil," by which we invariably mean Saudi Arabian crude -- and that we must generally distance ourselves from the kingdom and its leaders. Here is a rare issue that finds bipartisan traction. Last summer, for example, the comedian Jon Stewart looked and found that eight consecutive U.S. presidents starting with Richard Nixon, rolling through Ronald Reagan, both George Bushes, and finally Barack Obama have used the phrase in more or less the same formulation. Usually, the mantra is stated in the context of either the environment -- promotion of green industries -- or national security, meaning a way to confound terrorists who, it is said, are largely financed by Saudi and other Middle Eastern oil receipts. But ultimately they mean the same thing -- Saudi Arabia is bad, bad, bad.
|The Daily Show With Jon Stewart||Mon - Thurs 11p / 10c|
|An Energy-Independent Future|
I become suspicious of phrases that roll off the tongue and get me riled up, because often they are intended to accomplish just that outcome. Such is the case with the get-off-foreign-oil sloganeering, as I write in the latest issue of Foreign Policy. News from the Middle East and elsewhere exhorts the United States not to distance itself from Saudi Arabia, but in fact to more fully embrace this definitively central relationship. The reasons include top-tier U.S. strategic priorities regarding Iran, terrorism, Afghanistan, and of course oil.
WikiLeaks showed that the Saudis, unsurprisingly, have been in lock step with Western policy on containing Iran's nuclear program. The most dramatic recent example of the Saudi alliance paying off came in October, in the form of abortive terrorist attacks that were halted in Europe before they could reach the United States. Last summer and fall, U.S. intelligence agencies received three progressively more unnerving warnings from Saudi Arabia, all suggesting that al Qaeda was preparing to set off bombs in either Europe or the United States. The final alert, sent Oct. 28, was the most explicit, providing tracking numbers for two suspected explosives-laden packages on their way to Chicago from Yemen. A day later, police intercepted the packages at FedEx and UPS facilities in Dubai and Britain and defused bombs containing enough of the explosive PETN to take down the cargo planes on which they were to be shipped. Al Qaeda's Yemen affiliate claimed responsibility and warned of more such attempts. The take-away: Short of Saudi Arabia's insistent calls to the Central Intelligence Agency, there is almost certainly no chance that the bombs would have been detected.
What about the other main theater of current U.S. strategic interest, Afghanistan and Pakistan? With its long close ties to all parties in the region -- Pakistan, including the Army's jihadi-linked Inter-Services Intelligence directorate; Afghanistan; and the Taliban -- Saudi Arabia was asked early last year by Afghan President Hamid Karzai to help mediate a political settlement with the Taliban. In February, the Saudi foreign minister, Prince Saud al-Faisal, agreed to receive a delegation of former Taliban, but in November he froze contacts after the Taliban refused to repudiate Osama bin Laden and al Qaeda. Riyadh's position is not new: The Saudis adopted a similar posture position prior to 9/11, when they severed ties with the Taliban after its leader, Mullah Omar, refused to force bin Laden out of Afghanistan. Yet it is yet another example of crucial alignment in U.S.-Saudi policy.
All the while there is oil, although many people seem to suggest that as a source of strategic importance it is a temporary artifice. What are the facts? Not only will Saudi Arabia's predominant oil market position not shrink over the coming decades -- it will grow. Consider the current activities of Chevron, the original developer of Saudi oil, in the partition zone that the kingdom shares with Kuwait. Vice Chairman George Kirkland told me about Chevron's findings in the Wafra field, a reservoir of highly viscous, heavy oil in which the company is using a method of steam-injection drilling to recover an expected 10 billion to 15 billion barrels of petroleum. (For perspective, the industry regards a 1 billion-barrel field as a supergiant.) Saudi Arabia, Kirkland says correctly, is "at the top of the mountain as it is. [Wafra] reinforces a longer future delivering liquid hydrocarbons to the world economy." Meaning probably far into the second half of this century, adding up to another pinion of U.S. strategic interest. Here, Bloomberg's Wael Mahdi reports on Chevron's current progress at Wafra.
Those who suggest getting off Saudi oil are violating the basics of economics. As the pithy Anthony Cordesman of the Center for Strategic and International Studies expressed it to me: "What is the benefit for the U.S. of 'deplete America first'?"
Vladimir Putin had a relaxing "year of adventure," as my colleagues call it, impressing Russia and entertaining the rest of the world with populism -- motorcycle riding, whale harpooning, fire-fighting -- and coquettish flutters of the eyelids regarding his political intentions or lack thereof in 2012. But the most telling events happened in the closing days and weeks of the year, in which the Russian prime minister revealed his more familiar dark side.
I don't necessarily mean today's harsh prison sentence of 13.5 years against oligarch Mikhail Khodorkovsky -- enough to keep him in jail until 2017, factoring in the time he's already served -- which reflects hard-nosed Putin re-election strategy rather than unadulterated venality on his part. Rather, the more instructive event of 2010 is his embrace this month of racist hoods with chilling power on the street, a thread of extremism that Putin himself kindled and now is racing to get ahead of. Putin's December suggests that, for the moment at least, Russia prefers to remain an unnerving outsider.
ALEXEI NIKOLSKY/AFP/Getty Images
One of the most improbable of the big energy stories of 2010 has been the role of oil trading in the fall of governments, specifically those of Kyrgyzstan, the hub for U.S. jet fuel powering the air war in Afghanistan. In April, the second Kyrgyz president in five years collapsed in a maelstrom of accusations of high-level corruption involving an American contractor, billions of dollars in fuel contracts, rapacity and bribery. Today, the ballyhoo continues to threaten the crucial U.S. Manas Air Base in Kyrgyzstan, and the incredibly lucrative business of Mina Corp., a U.S.-owned company that over the last seven years has received some $2 billion in exclusive contracts to buy fuel in Russia, and sell it both to Manas and the key U.S. military base in Bagram, Afghanistan. This is because the current Kyrgyz government accuses Mina of enriching Kyrgyzstan’s former regimes in order to maintain the fuel trade, and the U.S. government of abetting the whole scheme. Both the Obama Administration and Mina are howling that they are terribly misunderstood, and pleading for another chance. Given the opacity of this story, I asked some old acquaintances – current and former oil traders – to guide me through the opaque thicket of oil trading in the world's war zones.
First, let’s get our definitions straight. When we are talking oil trading, we don’t mean the fellows who, as they did in 2007 and 2008, are driving up the price of petroleum toward $100 a barrel. Rather, we refer to an offshoot of this breed – a bold, fleet-footed and often eccentric sort with a rare talent for delivering crucial supplies to difficult places. It is a craft that involves the knowledge of – at turns – flattery, bribery, cajolery, and intimidation, in addition to logistics such as trucking, ocean shipping, railroads and barges; oh, and how to apply these skills in the turbulence of combat.
Historically, this profession generically falls under the rubric of war profiteering, a cyclical, inherently ephemeral category of business. I.E., fellows pile in, then in Darwinian-style either thrive or die. Those who survive become filthy rich, with the knowledge that soon enough the war will end, or tough locals will themselves want the spoils, so that the traders must have a ready exit strategy, such as a gassed-up car or private jet. When that time times, the most seasoned of the bunch get out in search of the next bonanza. Places to observe this phenomenon since 9/11 have been Iraq, Jordan and Kuwait; and Afghanistan, Pakistan and Central Asia.
The compensation for such individuals is considerable, meaning hundreds of millions of dollars (think Marc Rich). This is because wars are serious matters, and generals don’t have the time to fret over how the most crucial supply item of all – fuel – reaches them; they just want it there reliably, I am told. They certainly don’t pay attention to the peccadillos of the typical trader, which include exceeding reserve, paranoia, and also, frankly, often a bit of weirdness. One long-time oil trader pal of mine talks in such riddles that I frankly do not understand him. (We have previously discussed the peculiarities of Doug Edelman, Mina’s hippyish, secrecy-obsessed, multi-millionaire, burger-flipping owner. But more on that below.) As the Washington Post’s Andy Higgins described the fixation of the generals in Afghanistan (which applies for Iraq as well):
Without their supplies, the U.S. war effort would quickly grind to a halt. All American troops enter and leave Afghanistan on U.S. transport planes fueled by Mina in Kyrgyzstan. The firm also provides jet fuel for a fleet of C-135 aero-tankers that perform more than a third of all in-flight refueling operations over Afghanistan.
Yet, as suggested above, war profiteering has a life cycle, and Mina appears to be reaching the end of its time. It is hanging on (intellectually grasping the existence of the cycle and withdrawing gracefully are wholly different matters), and in the process Mina and U.S. officials – attempting to avoid a disaster in which the Manas base sinks along with Mina – have turned on each other. It hasn’t been a pretty sight.
For an excellent description of what we’re talking about, consider this law suit filed in Florida by a fuel trader in the Iraqi space – Supreme Fuels Trading – against a rival, International Oil Trading Company, known as IOTC. In the 2008 suit, Supreme accuses IOTC of bribing senior Jordanian officials for exclusive rights to ship fuel to Iraq, and to prevent rivals, including Supreme, from working the route. In a synopsis, the Federal Contractor Misconduct Database says, “In October 2008, the [U.S.] House Committee on Oversight and Government Reform, which looked into IOTC’s contracts, reported to Secretary of Defense Robert Gates that IOTC ‘appears to have engaged in a reprehensible form of war profiteering,’ and may have overcharged the U.S. government as much as $180 million.” Aram Roston has written powerfully about this suit.
No one should be shocked by such accusations, according to my oil trader sources, who say this is precisely how gonzo fuel suppliers must conduct business. (none of the traders with whom I spoke agreed to be identified. All called secrecy an obligation of the business, and suggested that blabbermouths can be risking their lives) Here is how one who has worked in both the former Soviet and Iraq spaces described the process in Central Asia and Afghanistan:
Along the way, you need to bribe a huge number of people – to get the Russian rail cars, to get on the Russian railway, to get through Russian customs, and then Kazakh customs on the other side of the border. Then Kazakh railways, and again Kazakh customs at the Kyrgyz border. Then Kyrgyz customs. Basically, every time you cross a border, you’ve got a bribe. Then when you are going to Afghanistan, you have to get the trucks licensed, and pay for protection from the northern warlords. This is a serious undertaking.
But while bribery is fairly straightforward, it’s also idiosyncratic. The fellows on both sides of the bribe are exceedingly nervous; once there is a deal, they are inclined to stick with it loyally and monogamously in order not to blow their “one and only chance to earn a few million dollars,” this source said. He went on:
One characteristic about bribery is that the guys getting it don’t admit it. They are taking money from someone they trust. To everyone else, they will say there just isn’t any capacity [to ship more fuel]. Those things tend to be natural monopolies.
This explains the use of offshore companies registered in highly secretive tax havens such as Gibraltar and Cyprus. There is no way to operate openly, because one’s accounting books can’t reflect an honest assessment of one’s expenses, not unless one wants to run afoul of U.S. or European anti-bribery laws. “Offshore companies are set up so they can pay [bribes to] these guys without anyone seeing,” this oil trader said.
In a desperate bid to save itself, Mina has hired a heavy-hitting and presumably expensive image-making and legal team, including for instance Bob Amsterdam, the aggressively garrulous Canadian lawyer who most recently was the public face for billionaire imprisoned Russian oligarch Mikhail Khodorkovsky.
Mina’s team has noted that investigators from a House subcommittee looked into bribery accusations against the company, and absolved it of any criminal wrongdoing. Their objective is to fend off a rear-guard action in which Washington appears prepared to throw the company overboard in an attempt to retain rights to Manas. In Bishkek, Secretary of State Hillary Clinton reportedly agreed to amend the fuels contract so that 20 percent to 50 percent of the deal would go to local companies. As Deirdre Tynan of Eurasianet.org reports, the Pentagon has additionally notified Mina’s foreign competitors with a suggestion that they resubmit their bids, giving them the impression that they might after all carve out part of the fuel trade. Kyrgyz authorities, meanwhile, are applying the usual local pressure tactics on Mina operations, which means raids by fellows claiming to be checking for compliance with various regulations.
Critics say the signs are that, if Mina is shoved aside, we will see shady Russian and Kyrgyz officials and companies getting fat under the same circumstances that receive such withering current criticism by the Kyrgyz government. “Kyrgyzstan produces and refines no oil. What other reason is there to give them a fuel supply agreement but to co-opt its leaders?” Ed Chow, who used to ply the region as an executive for Chevron, told me in an email. In terms of making a deal clean, he said, “A Russian partner is necessary since they actually deliver the fuel. A [Kyrgyz] state company could be above board; it depends on where the profits go.” But in the end, says Chow, there is reality:
We ask our military to win a fight and they try to complete the mission, which requires delivering fuel to Manas by whatever means necessary. That means dealing with what the locals and Russians want.
The assertion – contested by the Kyrgyz – is that one set of foxes will simply replace another in the henhouse. But if so, that – at least according to oil traders – is the natural course of this tumultuous business.
Photo by Photonichelle through Creative Commons
Today we're running a guest column by Russell Zanca, whom I regard as one of the keenest observers out there of Uzbekistan affairs. I met Russell in Tashkent in 1992, when he was a graduate student in Uzbek anthropology, and he went on to live for two years in the Fergana Valley. He is currently a professor of anthropology at Northeastern Illinois University.
Maybe failure is too harsh a judgment -- I am pretty sure that folks I know among the diplomatic corps who have been involved in U.S.-Uzbekistan affairs for the past two decades would disagree. But the reason our ties to Uzbekistan have largely fallen short, let's say, has everything to do with our inability to develop a reliable strategic partner in Central Asia who shares our values on human and civil rights, the respect for law, and democratic transparency.
It is not only Uzbekistan -- none of the five Central Asian states has achieved the democratic order and steady integration into global capitalism that we hoped for when they became independent in the Soviet collapse almost two decades ago. But Uzbekistan is something different -- it hasn't simply become a bit undemocratic, corrupt, nepotistic, and oligarchic. It has become superlatively dictatorial and cruel -- it is a vicious state. Its treatment of its citizens is neo-Stalinist to the core.
MAXIM MARMUR/AFP/Getty Images
Another reason why oil is a curse: It can force Pentagon officials to be complicit in apparent tax-dodging schemes by contractors providing crucial fuel supplies for the U.S. military.
Or at least that's the gist of a 75-page report issued today by the U.S. House of Representatives Subcommittee on National Security and Foreign Affairs, entitled "Mystery at Manas." It is the result of an investigation into Mina and Red Star Corps., shadowy companies that provide hundreds of millions of dollars a year in jet fuel to the American military's Manas Air Base in Kyrgyzstan and Bagram Air Base in Afghanistan. It is owned by a Stockton, Calif., man named Doug Edelman, who resides in London and registers his companies in the tax shelter of Gibraltar, but under the name of his French wife and Kyrgyz business partner. In the past, this blog has dubbed Edelman the "burger flipper," since his only known previous business venture was a burger joint in Bishkek.
One scoop out of the report concerns the April ouster of Kyrgyz President Kurmanbek Bakiyev. As you recall, Kyrgyz poured into the streets when gasoline prices suddenly went through the roof after Russia clamped on a substantial new customs tariff. Observers surmised that Moscow was punishing Bakiyev for reneging on a supposed agreement to expel Manas in exchange for $2 billion in aid for the country.
Not so, according to the House report -- it was because Mina and Red Star lied to Russia as to its ultimate customer. The companies said -- and Kyrgyz officials backed up the story -- that they were buying Russian jet fuel for civilian use. This was to get around a Russian policy prohibiting the export of strategic assets -- in this case jet fuel -- for purposes of war.
ALEXEY GROMOV/AFP/Getty Images
BP owes a lot, but how much exactly? Everyone knew this was coming: the U.S. Justice Department announced that it is suing BP for this year's enormous oil spill in the Gulf of Mexico. BP has been selling off assets to pay off the $20 billion in liability it has already acknowledged to the U.S. government. Depending on the outcome of deliberations in the United States, that sum could double. But, as the Financial Times notes, that calculus excludes the possibility that a U.S. court could issue a finding of gross negligence -- that BP simply wasn't on top of the work it was doing in the depths of the environmentally sensitive gulf. In such a case, BP's bill could double yet again, to around $80 billion. If that happens, look for the vultures to begin circling the company and its management -- BP may have a large liability, but it also has extremely valuable assets in Russia, Azerbaijan, and elsewhere.
Welcome to Africa's newest petrostate! The world has a new oil exporter: Ghana, whose Jubilee offshore oilfield began pumping petroleum this week. Analysts currently think the west African country has about 3 billion barrels of oil -- Jubilee alone is a supergiant with about 1.5 billion barrels. The reserves are particularly attractive given their location on the accessible Atlantic, and Ghana's relative stability in a turbulent continent. Jubilee could produce 120,000 barrels a day, according to field operator Tullow Oil.
Pipeline hopes die last. For all of its obvious hazards, the challenges of Afghanistan seem fated to attract the bold and ultra-adventurous --including oilmen and those in the pipeline game. This week, the leaders of Afghanistan, India, Pakistan, and Turkmenistan got together in Ashkabad to sign yet another agreement vowing to push ahead with a 1,000-mile-long natural gas pipeline stretching from Turkmenistan and on into the Indian subcontinent, reports Andrew Kramer of the New York Times. There's probably no point in noting that this is not the greatest of ideas -- as we learned in the last such attempt, Unocal's ill-fated effort in the 1990s to build a similar energy transportation network, pipeline folks heed their own inner voice.
Which way oil prices? At O&G, we have run out recent posts suggesting that oil prices are not necessarily headed into the stratosphere in the coming decade. But we also recognize that such exercises are in the end foolish -- if anyone truly knew where oil prices were going, the whole wealthy phalanx of oil traders would be out of business. So we will simply note that, at the Wall Street Journal, Jerry Dicolo makes the bullish case for oil. Dicolo cites dropping global stockpiles, rising demand, and recovering economies in his prediction that oil is heading into the triple digits, and "might stay awhile" there.
Gas, gas everywhere. The U.S. Energy Department adds another data point to the now-familiar narrative that we are awash in natural gas, reports Matthew Wald at the New York Times. The department's Energy Information Administration has doubled its estimate of the volume of shale gas in the United States to a 36-year supply, given U.S. demand. The sudden appearance of shale gas has shaken up global energy and geopolitics -- in Europe alone, it has made former Soviet satellite states less worried about their winter supplies, and weakened the hold of Russia's Gazprom on the continent. The EIA report is interesting in other respects as well: It forecasts that oil prices will not explode over the coming quarter-century, and neither will heat-trapping gases.
For some time, people have wrung their hands over compromises the United States is making on its human rights agenda by palling around with Uzbek President Islam Karimov, the most brutal of the strongmen in the former Soviet Union, whose family we profiled the other day. The New Yorker's Amy Davidson trots out the usual complaints: official torture, forced labor in the cotton fields. When one raises such matters with Obama administration officials, the reply is, "Yes, but we are making progress, and ain't that northern distribution network -- the military cargo network passing into neighboring Afghanistan -- nice?" Which only makes people wonder all-the-more whether that hallowed road network is American policy in Central Asia, as Josh Kucera reports at the Bug Pit.
Back in September, Chris Chivers of the New York Times flew out to Tennessee to visit Sanjar Umarov, an Uzbek physicist who had got on Karimov's wrong side by delving into politics, and ended up sentenced to 14 years in prison, drugged, and beaten up. That month, the U.S. embassy in Tashkent had managed to spring Umarov on a humanitarian basis, and fly him to Tennessee, where he already owned a home. I got on the phone with the 54-year-old Umarov and his son, Gulam, yesterday, and he again recounted the travails of the prison system. Both he and his son were effusive in their gratitude to the United States. "He would have died in prison," the son told me.
Which raises a couple of points. One is that Umarov's case -- as well as that of Voice of America reporter Abdumalid Boboyev, who was charged by the Karimov regime but then freed -- does not mean that Karimov has suddenly gone soft. In both cases, the defendant had a strong American connection (Umarov has a green card; his wife is a U.S. citizen, as are a couple of his children), allowing Karimov to keep up his local image for toughness against Uzbeks while making nice with Washington.
Yet it also means that there are more layers to the Uzbek story than just the WikiLeaks cables. Four years after ejecting the United States from the Khanabad military base for the temerity of providing amnesty to victims of the Andijan massacre, Karimov, I am told by people who were speaking with him at the time, had soured yet again on Russia. He was ready to make another in his cyclical coquettish courtships of Washington. Karimov is the great recalibrator.
So what will happen to the northern distribution network when Karimov next recalibrates, and swings predictably back to Moscow? Given his record, that will happen before there is peace in Afghanistan.
IVAN SEKRETAREV/AFP/Getty Images
Is Tehran convinced the United States is out to steal its oil? Here's Kazakh President Nursultan Nazarbayev, in a cable describing a Jan. 14, 2009, meeting in the capital city of Astana between Nazarbayev and U.S. Gen. David Petraeus, in which the Kazakh leader recounts his recent conversations with Iran's leaders:
[Nazarbayev] said Supreme Leader Ayatollah Khameni told him that even if Iran compromises on the nuclear issue, the United States would always find another reason to criticize "because they hate us -- all the United States wants is to conquer the entire region and steal the oil." General Petraeus interjected, "We could have bought all the oil in the region for 100 years for what we've spent in Iraq!" Nazarbayev, looking a bit amused, said, "I know. I'm just telling you what he said."
The cable, signed by Richard Hoagland, the U.S. ambassador to Kazakhstan, is also interesting for Nazarbayev's pretty shrewd insights into Afghan politics. Nazarbayev is worried about publicized efforts to bring the Taliban into the Kabul government. Petraeus, then the head of U.S. Central Command, replies that this is just an attempt to break up the movement, while roping certain elements into the power circle. That's all well and good, Nazarbayev replies, but suggests that the Taliban is all about control, and not sharing power: "The Taliban leadership will never change its position," Nazarbayev says.
KARIM SAHIB/AFP/Getty Images
As the debate in the United States' foreign-policy community rages over how long the war in Afghanistan should last, one inescapable question baffles both sides of the argument: What to do about Pakistan? Long derided as the "true epicenter" of global terror, Pakistan is discussed mostly in the realm of rumor and stereotype, and very little fact, history, or knowledge.
Understanding how Pakistan became the incubator for so many terror groups -- an exciting alphabet soup of acronyms like the QST, the TNSM, LeT, JeM, HN, TTP, and many others -- requires understanding Pakistan's evolution not just as an Islamic society, but as a fractured state determined to use Islam to secure and protect its own legitimacy. This is a phenomenon that seems to emerge regardless of who runs the government -- military or civilian, male or female, liberal or conservative, all the leaders of Pakistan have felt they could only rule through differing interpretations of Islam.
In The Scorpion's Tail: The Relentless Rise of Islamic Militants in Pakistan-And How It Threatens America, the Wall Street Journal correspondent Zahid Hussain charts a sobering history of the Pakistani state's relationship to Islam, Islamism, and Islamic radicalism. While the radicalist form of Islam -- the kind America really cares about -- didn't take root in Pakistan until the 1980s during the war between Afghanistan and the Soviet Union, it was, Hussain argues, the result of decades of Pakistan's elites politicizing Islam to shore up their rule of the country. Starting with the partition of India and Pakistan in 1947, and moving through the tumultuous history of coups, countercoups, and new constitutions, Hussain walks the reader through Pakistan's steady Islamization.
I was surprised to learn on a visit to Brussels last week that the confusion is worse than I had thought among Europeans regarding Nabucco, the object of a long and thus-far-quixotic effort to connect Central Asian natural gas supplies with Europe.
Nabucco, a proposed natural gas line intended to reduce Europe's reliance on Russia's Gazprom, has seemed to me until now primarily an American fixation. But it seems that the Europeans are obsessed as well -- and also a bit in denial. In a nutshell, there seems to be a serious need for a primer on Turkmen politics.
BURHAN OZBILICI,/AFP/Getty Images
The reclusive Douglas Edelman lives in London's posh district of Kensington, but according to those who know him, he cultivates the image of an easy-going, hippieish Californian, complete with a laid-back demeanor, plaid cotton shirts, and jeans. Edelman's business card identifies him as the representative of a company called Aspen Wind, and he is known for helping finance and produce a film about the evangelist Billy Graham. But we of course are best acquainted with him as the proprietor of a greasy spoon in Bishkek, Kyrgyzstan who has been attracting much attention for the $3 billion in single-source contracts he has obtained over the last seven years to deliver jet fuel for the war in Afghanistan.
At the end of last week, the Pentagon apparently finally got around to asking the contract-holder -- a Gibraltar-registered company called Mina Corp. -- who its owners are, writes the Washington Post's Andy Higgins. Lo and behold, Mina did not list Edelman as its owner, but instead his previously unknown French wife, Delphine Le Dain, along with a 35-year-old Kyrgyz named Erkin Bekbolotov.
JOEL SAGET/AFP/Getty Images
Mina Corp., the focus of a Kyrgyzstan criminal investigation into alleged corruption, has been awarded a new $315 million contract to deliver fuel to the U.S. air base in the Central Asian republic. The new contract -- on top of some $3 billion in previous contracts with the Pentagon -- was announced this evening on the Pentagon web site.
As this blog wrote earlier this week, the Kyrgyz and a congressional committee have investigated allegations of improper payments from Mina and a sister company called Red Star to ousted President Kurmanbek Bakiyev, who fled in April. Senior Kyrgyz officials have accused the United States of allowing corrupt payments to be funneled to Bakiyev in order to retain rights to Manas Air Base, which services Afghanistan.
Mina itself appears to have no known office. Instead, as the Washington Post reported this week, its mailing addresses are mail drops, although one company official told the Post that Mina has 450 employees in undisclosed locations.
The fuel contracts have been a source of much tension between the United States and Kyrgyzstan. They partly led to Kyrgyz demands for the removal of U.S. Ambassador Tatiana Gfoeller, who is leaving the country before the end of her regular tour. The Pentagon reacted to criticism of past no-bid contracts awarded to Mina by putting the latest fuel contract out to competitive tender. Mina triumphed today over eight other bidders, according to the official anouncement.
VYACHESLAV OSELEDKO/AFP/Getty Images
Six months after a U.S. fuel contract contributed to the ouster of Kyrgyz President Kurmanbek Bakiyev, we appear no closer to knowing whether his opponents are correct in assuming corruption and other criminality in the deal. At issue is a $3 billion U.S. military contract with two companies registered at mail drops and in offshore tax havens, and run by a cloak-and-dagger California native who makes Julian Assange look as open as Oprah, the Washington Post's Andy Higgins suggests in a weekend piece. The current Kyrgyz government says the contract enriched the Bakiyev family, and that the U.S. tolerated the situation to guarantee the longevity of Manas Air Base, which services the war in Afghanistan. Incidentally, Bakiyev alleged the same thing when he helped overthrow the Askar Akayev regime in 2005.
By approving such contracts, does the U.S. in effect cultivate the very corruption that it aggressively abhors in governments around the world? Scott Horton, a New York lawyer who sits on the board of American University in Bishkek, is among those who think so. At the Harriman Institute last Friday, Horton said:
The latest Transparency International corruption index is out, and it shows that countries occupied by the United States, in which U.S. contract awards have decisive importance to the economy, are two of the five most corrupt on earth. These nations have, moreover, become dramatically more corrupt since the U.S. took over. What is the relationship between having a large U.S. military installation and military contracting on your territory and corruption? The TI index points to a direct relationship. The U.S. talks a good tune about democracy, transparency and the rule of law. What it delivers is just the opposite.
(Full speech transcript here.)
VYACHESLAV OSELEDKO/AFP/Getty Images
Worries about geopolitical bogeymen can overwhelm good sense. Case in point: today's melee over the discovery that Iran has been regularly handing Afghan President Hamid Karzai fistfuls of cash. Just who is Tehran endangering by keeping Karzai lubricated with pocket change? For one, the fellows U.S. troops are fighting: the Taliban. Karzai calls the payments "normal," and he is right. In the case of Afghanistan, Iran is in effect a U.S. ally.
It's useful to keep in mind that Iranian influence in Afghanistan is traditional. The two countries share a language, after all -- making it easy for the Iranians, for instance, to be particularly close to the leaders of the populous Herat and Balkh provinces, in the west and north of the country. Since the mid-1990s, the Iranians have served a useful balancing purpose to the Pashtun Taliban.
Majid Saeedi/Getty Images
CNOOC, Statoil Invest $1 billion in south Texas' Eagle Ford oil shale. Guess who will be scrutinized and who won't? The betting is that the Chinese National Offshore Oil Corp. will not suffer another fiasco like in 2005, when it lost in its attempt to land Unocal. This time it will manage to hold on to its investment, in this case a $1.1 billion buy-in into the scorching hot shale bonanza. Yet some analysts say that election-year jingoism in the United States could again leave China out in the cold. Ditching the deal will be difficult, however, since it was announced on the same day -- Oct. 10 - that Norway's Statoil unveiled its own, $1.3 billion deal with Talisman involving another section of the Eagle Ford field. Given the continued interest of U.S. energy companies in China, the Administration and Congress may have to tough out any instinct to scuttle the CNOOC project.
IEA Bumps Up Oil Demand Forecast for 2010, 2011. The Paris-based International Energy Agency lent credence to those who believe that the global economy is slowly recovering with its much-watched oil report. The agency said increased demand in both developing and industrialized countries means the world will use 86.9 million barrels a day this year, 300,000 barrels a day higher than previously forecast, and a full 1.5 million barrels a day more than last year's recessionary pullback. Next year, the IEA predicts, demand will rise another 1.3 million barrels a day. What does this mean? Not lower gasoline prices at the pump, that's for sure. Possibly, however, that the record inventories of oil around the world will start falling, and put a floor under what this year has been a volatile market. Reports by Deutsche Bank, France's Total and a couple of think tanks have foreseen comparatively high oil prices headed into the middle of the decade, before falling again, and this could be the start of that climb.
Oil: another target in the Afghan war. Militants linked to the Taliban have spent much of the last 10 days or so blowing up NATO oil and fuel tankers plying routes from Pakistan into Afghanistan. Today there was another attack in the Khyber Pass leading from the Pakistani city of Peshawar into eastern Afghanistan near Jalalabad, where two died in an attack on a NATO fuel truck. It is a time-tested strategy -- war combatants have been targeting each other's fuel supplies ever since Winston Churchill triggered the age of strategic oil just before the outbreak of World War I. Over at Wired's Danger Room blog, Katie Drummond writes of a three-mile-long jam of NATO fuel trucks on the very same route (the piece includes must-see satellite images of the bottleneck by DigitalGlobe).
Moratorium lifted in the Gulf of Mexico. Taking no chances with control of Congress on the line in Washington, President Barack Obama lifted a moratorium on drilling in the Gulf of Mexico more than a month before scheduled. Six months after five million barrels began spilling into the Gulf from BP's Macondo well, the administration said that oil companies again can drill in both shallow and deep water, though under a tighter regulation regime, and with more surprise inspections. At Investing Daily, Jim Fink calls it Obama's "October Surprise." But Obama was wrong if he thought the move would silence the hecklers. Over at the State Column, a still-dissatisfied Louisiana Gov. Bobby Jindal took a swipe at Obama and his "harsh," "job-killing," "arbitrary," and "capricious" decisions regarding the Gulf.
In my third year reporting in Central Asia, I was summoned to the press spokesman for Uzbekistan President Islam Karimov. My articles from Newsweek and the Washington Post were spread across his desk. "Can you not find one good thing to say about my country?" he asked. His face was stretched taut. And with that, I was invited to leave Tashkent. For the next five years.
Fortunately, I was able simply to cross the border and set up in neighboring Kazakhstan, from which I reported for the subsequent years -- including cross-border news-gathering forays on foot back to Tashkent in a charade with the Uzbek authorities. (I pretended I wasn't there, and they pretended not to be watching.) The situation is completely different for Abdumalik Boboyev, an Uzbek reporter for the Voice of America, and one of the last -- perhaps the last -- journalist on the ground delivering the type of globally distributed reporting that can get you expelled or jailed.
Radio Free Europe/Radio Liberty
In February 1989, Soviet troops withdrew from Afghanistan after a decade-long U.S.-backed rebellion in the country. But already the United States was greatly reducing spending in Afghanistan and Pakistan, the staging ground for the arming of mujahideen guerrillas. President George H.W. Bush ordered the Central Intelligence Agency to stop sending agents into Afghanistan. Even as the Taliban was born in 1994, taking power in Kabul two years later, the United States remained aloof. We know what happened next.
Today, my FP colleague Dan Drezner in effect suggests a similar U.S. path in former Soviet Central Asia and the Caucasus. Responding to an essay I wrote for the New Republic, Drezner argues that the region was perhaps once a U.S. strategic interest, but that those days are over. The United States should not fight for its place: "There are a lot of regions in the world where I think a robust U.S. presence is a good idea. Central Asia is no longer one of them," he writes.
DOUGLAS E. CURRAN/AFP/Getty Images
Today, the Taliban set 22 NATO fuel tankers ablaze in the southern Pakistani border city of Quetta. That's a day after a fuel tanker was blown up at Torkham, the border post leading into Afghanistan. On Monday, the Taliban set 20 NATO oil tankers afire in Rawalpindi, outside the Pakistani capital of Islamabad.
In all, the Taliban's oil war has gone on for a week straight. This is a page straight out of the histories of the two world wars, in which access to -- and the absence of -- oil was the deciding factor in both making and breaking enemies.
Until now, the attacks have been explained as the Taliban capitalizing on a standoff between the United States and Pakistan over Pakistani casualties in drone attacks, to which Pakistan has responded by closing the border at Torkham, and leaving the fuel trucks exposed. But that doesn't explain today's attack in Quetta.
In fact, as the U.S. military has clearly documented, long fuel convoys have been among the main sources of American casualties in both Iraq and Afghanistan. The Taliban are Exhibit No. 1 as to why the military is working to untether itself from fossil fuels.
AAMIR QURESHI/AFP/Getty Images
The United States is at war in Afghanistan and Iraq. It is trying to make peace between the Israelis and the Palestinians. Washington's relationship with Russia is still fragile.
Thank goodness for the annual United Nations General Assembly, a place to meet casually, massage some shoulders, and point fingers at some chests -- in short, an opportunity to get much important business accomplished efficiently. Since time is short, and demands for face time high, fixing the bilaterals can be tricky -- these are the few people a U.S. president chooses to grace with direct, one-on-one chats. Basically there are five such meetings. But such matters are ironed out with diplomacy.
So who are President Barack Obama's bilateral five this Thursday and Friday? If you guessed Azerbaijan's Ilham Aliyev and Kyrgyzstan's Roza Otunbayeva, you would be correct (oh, and also China's Wen Jiabao, Japan's Naoto Kan, and Colombia's Juan Manuel Santos.).
How is it that two of the ‘Stans won the beauty contest? Bluntly speaking, it's because of their status as war entrepots.
MUSTAFA OZER/AFP/Getty Images
When John Imle was president of Unocal, he was known in the oil industry as a cowboy. He had ambitions of challenging the world's biggest multinationals, and to that end took some of the business's biggest gambles, making a deal with the pariah regime in Burma and flirting with the Taliban in order to build an oil pipeline across Afghanistan. Both created serious public relations disasters, and Imle eventually ended up out on the street with a handshake.
But that was a decade ago -- people have a new oil company to hate these days, and with Tony Hayward en route to Russia, a new guy soon will be inheriting the mess. So I asked Imle whether he had any advice for BP CEO-designate Bob Dudley (above) as he takes power in the current age's biggest fiasco. His response:
If I were to have a drink with Bob Dudley and if he asked for advice, I would tell him:
1. You come off as a modest, transparent, honest executive with an ego that is well controlled -- don't change!
2. One of your predecessors (during your turtle era) once told me that I was too honest. If he told you that -- ignore the comment --- he ruined the company, didn't he?
3. You can change the BP safety culture very quickly if you really want to and show that you're serious -- by dumping those who don't cooperate. They are replaceable in a nanosecond. This will speed the process and you have no time to waste.
4. BP is in deep trouble -- perhaps its reputation is unrecoverable. I know from bitter experience that once behind the PR curve, catching up is near impossible. You will have to assess whether recovery is possible and if not, act boldly to preserve value for your shareholders -- even if it means dividing and selling. You may have to relinquish operator status in deep water plays. Let your partners operate or sell to those who can operate for you. Doing it yourself could be counterproductive for a while -- perhaps a long while.
5. BP's profits will suffer greatly -- markets will scream -- but being predominately non-operator may be the best path forward. You'll get the profits with less exposure to the microscope.
6. Go back to number one -- about the ego -- both yours and that of the company.
Oli Scarff/Getty Images
The U.S. military is studying a plan to solve Afghanistan's problems by turning it into a superhighway of roads, railroads, electricity lines and energy pipelines connected to the entire Eurasian landmass. According to a piece in the National Journal by Sydney Freedberg, the proposal has the ear of Gen. David Petraeus, whose confirmation hearings to be the new U.S. and NATO commander in Afghanistan start today in the Senate Armed Services Committee.
The plan is heavy on ringing optimism. I have my doubts. They are rooted in the last time this was tried, in the 1990s, when Unocal -- now part of Chevron -- sought to build an $8 billion oil-and-natural gas pipeline network from Turkmenistan to Pakistan via Afghanistan. The plan -- which Unocal saw as so potentially lucrative that it could catapult the company into the big leagues of the industry -- attracted much attention, hoopla and hopes for peace after years of war and chaos in the country.
John Moore/Getty Images
Steve LeVine is the author of The Oil and the Glory and a longtime foreign correspondent.