Analysis
The natural gas market highlights US, Europe hypocrisy
Europe has many suppliers available that could contribute to decreasing the share of its gas imports from Russia, but the US and the Europeans themselves have done everything they could to destroy this possibility.
As the saying goes, the chickens are coming home to roost—and by that I mean the conflicting interests of the US, of NATO’s partners, and of the members of the Alliance themselves. We also owe this situation to London and Paris, who have been supporting the US’s plans in the Middle East.
These plans aimed to favor Saudi Arabia and Israel, and wrecked Libya, our source of fuel, in 2011. It is no coincidence that the Wahhabi kingdom is the largest buyer of American and French arms, the two greatest war exporters in the world. To be fair, in Brussels Trump should have asked not Germany but rather the French to increase their NATO expenditure, because at the moment it is France and the British who are earning the most from being in the Alliance. The chickens are coming home to roost because Europe (together with Russia and China) will soon have to face the issue of the sanctions against Iran, both on oil and trade with the Islamic Republic. Trump cares most of all about two issues: getting a positive outcome with Kim’s North Korea (and for this, he will need a helping hand from Russia and China), and backing Iran into a corner, as Israel—the nation with the greatest amount of influence in Washington—is insistently demanding, together with the Saudis.
These American games with Iran might end up costing Italy €27 billion in orders, and exports worth €1.7 billion a year. This in addition to an increase in NATO expenses, which we can very little afford. This is why Italy must make preparations, perhaps by creating a new institution which would manage funds in euros, specifically to circumvent the US sanctions that will freeze payments to and from Tehran from November. We’ll have to see if we will bow down this time as well, as usual, before the US and Israel.
Part of the game being played is calculations about natural gas. If it were to exploit its enormous South Pars field at capacity, Iran could provide Europe with most of its annual gas consumption (500 billion cubic meters). This is a subject that everyone finds irritating to talk about at the moment, because the situation is politically and morally embarrassing. North Korea gets welcomed with open arms even as the nuclear threat from Pyongyang is ongoing, but Iran, which signed a nuclear deal in 2015, is being shunned. It is a devastating point that makes a mockery of the notion of international lawfulness.
The war in Syria, decided in 2011 by Hillary Clinton, with her Turkish and Arab allies and backed by France and Britain, was aimed (among other things) at blocking the Iranian pipeline projects towards the Mediterranean shores. Now, Iran, the second country in the world after Russia in terms of gas reserves, is being pushed into the arms of China, which has also bought the shares of the Islamic Republic’s deposits belonging to the French company Total. If Europe is losing influence around the world, this is because of nothing but its own foolishness.
Europe has many suppliers available that could contribute to decreasing the share of its gas imports from Russia—after all, the first rule for consumer countries is to diversify their suppliers—but the US and the Europeans themselves have done everything they could to destroy this possibility. The war in Syria was aimed at stopping Iran, a proxy war against an enemy of Israel, while the war in Libya, desired by France, has drastically reduced the odds of building the Greenstream gas pipeline to Italy. Today, Libyan gas is almost entirely consumed inside the country.
This disastrous situation in the Mediterranean was created, step by step, not by Merkel but by Obama, Sarkozy and Cameron.
Now, Trump wants Germany to give up on doubling the capacity of the North Stream 2, thinking also about the deadlines of Ukraine’s contracts for Russian gas. To sum up, Washington wants nothing else than to impose sanctions on Moscow via Berlin (we are waiting for Salvini’s comments on this, as his usual loud mouth has been very quiet today). This is a problematic strategy, creating an impulse toward separating the fate of Western Europe from that of its eastern part: starting from 2022, the Poles will be buying liquid gas from the Americans. That can’t be a good deal, seeing as it is being delivered across 10,000 kilometers, but the United States is selling it at a steep discount, just to pamper Warsaw.
The US is in favor of the Southern Gas Corridor in Azerbaijan and Turkey, which aims to bring Caspian gas to Europe and to Puglia as early as 2020. This is somewhat good news for Italy, which has already had to give up on the South Stream pipeline to Moscow (i.e. giving up on an estimated €2 billion in orders made to the Italian company SAIPEM), but the capacity of this pipeline will be only 10 billion cubic meters per year, much lower than the supply from Russia, Iran, Libya, Algeria itself, or, in the future, from Egypt (Eni-Zhor), as well as from the continental shelf being disputed between Cyprus, Lebanon, Israel and Gaza. Instead, with Libya and Algeria we would have two gas pipelines from right next door, with obvious benefits for bilateral trade—but no, it looks like we will have to get our gas all the way from the Caucasus, as a favor to the United States. This would make some sense if Washington were to get Libya, the gas field next door, back on its feet, but we know that it won’t.
And there’s more. A new American conflict with Erdogan is on the horizon. Included in the agreements between Ankara and Moscow is a resumption of the Turkish Stream pipeline, which is part of the deal to stabilize northern Syria and keep Assad in power. What Erdogan will do now regarding the US is another interesting question, because the Syrian situation is complex: Putin cannot let its ally Iran stand alone, as the United States and Israel are demanding its withdrawal from Syria and plan to choke its economy.
The slogan “America First,” which includes commercial, energy, and military interests, tariffs and sanctions, is a sour-tasting concoction that Trump is pouring into the cocktail shaker, and we will not only all have to drink the results, but also—and especially at our own table—foot the substantial bill.
Originally published at https://ilmanifesto.it/vertice-nato-il-gas-fa-esplodere-le-contraddizioni-usa-europa/ on 2018-07-13