U.S.-Russia Disagreements over Oil Through Georgia

Written By Christian DeHaemer

Posted July 29, 2015

In the mid-1990’s, the U.S. constructed an oil and gas pipeline through several republics that had been freed of Soviet Russian control, aimed at cutting Russia’s continued dominance over the economies of Georgia and Azerbaijan in the Caucasus region.

Now, the two pipelines that did the most damage to Russian monopolies Georgian Pipelineson oil and gas at the time were BP-operated, one traveling from Baku to the port of Supsa in Georgia and the other from Baku to the port of Ceyhan in Turkey.

The U.S. ambassador to Azerbaijan Richard Kauzlarich says, “I believe that [Putin’s] strategic objective to reverse all ‘gains’ the U.S./West has achieved at the expense of Russia…”

In the beginning of this U.S. venture, Russian President Vladimir Putin did not have the power to stop construction of the pipelines. In 2008, the first move was made to reclaim the land that had been seemingly cut off by the pipeline.

President Putin sent the Russian army into Georgia under the guise of protecting the South Ossetians from Georgians, and roughly 45 bombs were dropped near the Baku-Ceyhan pipeline — clearly claiming Georgia as a subject of Russia despite the change in oil and gas supply.

Then two weeks ago, a Russian annexation of Georgian land, just a mile away from the South Ossetian border, was outed by the Georgian Ministry.

This is a huge concern for both Georgia and BP; a full mile of the Baku-Supsa pipeline lies in the claimed land.

Now avoiding direct credit of the change to Russian actions, BP has said that they intended to rebuild the pipeline and remove the section claimed by Russian annexation.

To continue reading…

Click here to read the Quartz article.

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Christian DeHaemer

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Christian is the founder of Bull and Bust Report and an editor at Energy and Capital. For more on Christian, see his editor’s page.

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