Azeri Oil and Warmongering

BY GAREN YEGPARIAN

It’s not as though “President” Ilham Aliyev, safely ensconced in Baku, needs an excuse to use his army’s soldiers as murderers, taking the lives of young Armenians guarding the borders (or more realistically, the battlefront, euphemistically called “line of contact” in official parlance) of the Republics of Armenia and Artsakh.

But, there’s something else afoot on the world stage, other than COVID-19, that may prompt even more despicable behavior by Azerbaijan than usual.

You may be aware that there’s an oil war on. This time it’s not George W. Bush’s America invading Iraq. It’s Russia vs. Saudi Arabia/OPEC. The price of oil had been dropping and OPEC made an arrangement among its members to reduce production to prop up the price. Russia usually goes along with those arrangements its seems, but this time chose not to. What could be the reason? Why would a country with an economy so reliant on natural resource extraction undercut the value of its own product? The argument, it seems, is that Russia seeks a larger share of the market.

But a more interesting interpretation of Russia’s behavior contends that its goal is to cause serious harm to the shale oil industry in the U.S, a serious competitor. Producing oil from shale costs more than the traditional way of drilling a well and letting the underground pressure force oil up, or, when that gets too low, re-pressurizing it by injecting water or pumping it. It seems the breakeven price for oil shale is $60 per barrel. As of this writing, the market price was below $32.

If this “war on shale oil” angle is correct, it seems to me the Russians are trying to win in the short term, but may well end up losing in the long term. If indeed the U.S. shale oil industry is harmed, impacting production, then an even greater incentive will be created to more rapidly develop newer, and cleaner, energy sources – primarily solar and wind. This would propel the U.S. even faster towards freedom from oil, a primitive and heavily climate damaging source of energy whose time has passed. In the long run, Russia would have sped up the demise of the need for oil, hence its customer base.

With this limited exploration of the reasons for the current drop in oil prices. Let’s return to the main topic, Azerbaijan. As we all know, this dictatorship survives on its oil and natural gas production. After all, Aliyev and his cronies are “entitled” to “appropriate” their “share” of the country’s wealth before having any of it benefit the general population. With less money coming in (the price per barrel is now around 60% of what it has been for the last 3-4 years), there’s less available to tamp down people’s dissatisfaction with the regime. All this means Aliyev & Co. need to distract their citizenry from their woes. They must mis- and re-direct any anger away from the real roots of the problem, the thieving ruling class of Azerbaijan.

The “natural” solution from the perspective of the purveyors of Armenian-hate in Baku is… to kill some Armenians. As a practical matter, this means ratcheting up tensions on the front to elicit an Armenian response and be able to say “hey, look at what those bad old Armenians are doing to us…” We just read about the killing of an Armenian soldier on the western front, with Nakhichevan, not along Artsakh’s borders. That alone is a bigger deal than the frequent killings that occur along the latter. Depending on how long the need for distraction goes on and how great it becomes, we might even see the instigation of another mini-war by Azerbaijan as occurred in April 2016. It’s worth noting that oil prices had dipped quite low around that time, too.

Perhaps it’s time we started focusing our elected representatives’ attention on this potential problem so we avoid needless loss of life. Maybe, just maybe, European and American pressure, combined with Russia’s “need” for perpetual tension, but not instability or war, between Armenia/Artsakh and Azerbaijan might succeed in prevention… Get busy with your phones and computers.

Failing this preemptive peacemaking, it will be time to give Azerbaijan a major drubbing (meaning loss of more of the originally Armenian lands still under its control) as a reminder of what happened in the early 1990s.