Friday, June 6, 2008

Nagorno-Karabakh and the New Great Game

"Private intelligence agency" Stratfor published an article* last month suggesting that Russia was seeking to foment tensions between Azerbaijan and Armenia over the de facto Armenian, de jure Azeri territory of Nagorno-Kabarakh. Another Stratfor article published earlier in the year details the Kremlin's close ties with Armenia (total subjugation of the country's rail and mobile phone networks, and increasing control of the country's energy and mining sectors). Russia has been aiding both sides militarily – the Armenians with Russian troops, and the Azeris with weapons leakage from Russia's recent withdrawal from Caucasian neighbor Georgia.

The more recent article gives three reasons that the Russians would want to stir up trouble over Nagorno-Kaharakh: to be able to say "I told you so" after Kosovo; to make the West think twice about Azerbaijan's stability; and lastly so that Russia could step in and solve it and look good doing so. But, the author only devotes one sentence to the issue of energy, saying that "[t]he West worries that renewed conflict could destabilize their investments in Azeri energy infrastructure." In light of recent bidding between the EU and Russia over the future of Armenia's energy resources, any Russian interference in the region ought to be looked at primarily from the standpoint of energy politics. War between Armenia and Azerbaijan would both raise the risk premium on natural gas and repel Western investors, delivering Armenia back into the hands of the Kremlin. High energy prices finance Putin's regime and placate a citizenry that is otherwise doing pretty poorly, and a monopoly on delivery of natural gas gives Russia leverage over both its former republics and the rest of Europe. If Russia is creating a geopolitical climate that destabilizes energy flows, there can be no doubt that it's acting intentionally.

* The site is subscription-only, but it allows you to see articles if you click a link from Google. So, do a search for the title of the article and click on the link from Google's search results page. Sorry, Stratfor!

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