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Caspian Sea Oil Reserves – Trouble Brewing? - 2001-09-04

Until recently, conflicts over the vast oil reserves in the Caspian Sea have been resolved with no threat of force. But Iran has changed that by forcing a British Petroleum (BP) vessel out of an area claimed by Azerbaijan. Energy expert Robert Ebel says he was quite surprised when he learned that in late July Iran had evicted a rival ship from the oil-rich Caspian Sea. "For a number of months I had been saying that the unresolved question of the legal status of the Caspian Sea had not interfered with oil and gas exploration and development. I really cannot say that any more because of what Iran did. Things have changed," he said.

An Iranian warship and fighter plane threatened a British Petroleum (BP) vessel exploring for oil in waters claimed by Azerbaijan. Avoiding a confrontation, the BP ship moved away and has not returned, pending some settlement of the dispute.

Much is at stake, both political and economic, says Mr. Ebel, who directs the energy and national security program at the Center for Strategic and International Studies in Washington.

Under the current arrangement, each of the five states bordering the Caspian receives a share of the sea proportionate to its coastline. That allots 12 percent of the Caspian to Iran. Using a different measurement, Tehran claims 20 percent.

More than oil is involved, says Mr. Ebel. There are also power and influence and even national sovereignty. More Azeris live in Iran than in neighboring Azerbaijan. Tehran fears rising separatist tendencies among its Azeri population and thus may have delivered a warning to Azerbaijan.

Iran could have an even larger objective, says Vladimir Socor, Munich-based analyst of Washington's Jamestown Foundation: "The maximal objective would be to prove to Azerbaijan that this country cannot count on its western partners in a crunch," Mr. Socor says. "Should that demonstration be successfully made, then Iran would come close to achieving its goal of changing Azerbaijan's pro-western orientation in politics, economics and in many other ways."

Mr. Socor says this would also benefit Russia, which has offered to mediate the dispute. That would give Moscow more leverage over Azerbaijan, which is too weak to stand up against the greater powers.

Given this situation, says Mr. Socor, the British and U.S. reaction to the Caspian incident has been very mild. He adds that security must accompany economic development in a troubled region: "Some Azerbaijani officials have suggested that either NATO or the United States or most likely Turkey should establish some kind of military presence in Azerbaijan, preferably in the form of an air base," he says. "But those suggestions have not impressed Washington or in Brussels. The perception is that such a deployment would be fraught with risk, would antagonize Russia and might provoke unpredictable reactions from both Moscow and Tehran."

Robert Ebel notes Azerbaijan is already engaged in a territorial struggle with Armenia and Azeri president Heidar Alyev, is seriously ill. His departure could lead to a power vacuum that others would be glad to fill. All the more reason, says Mr. Ebel, for a quick settlement of the Caspian dispute: "It raises the temperature in the region considerably," Mr. Ebel says. "From now on, almost every action of the five littoral [coastal] states will be viewed against the background that Iran has created. What is the next step in resolving this? Can we bring the five presidents together to find some solution that is satisfactory to everybody?"

Mr. Ebel says the countries of the Caspian will benefit far more from developing the oil than from quarrelling over its division.