Best of the Week
Most Popular
1. Gold Final Warning: Here Are the Stunning Implications of Plunging Gold Price - P_Radomski_CFA
2.Fed Balance Sheet QE4EVER - Stock Market Trend Forecast Analysis - Nadeem_Walayat
3.UK House Prices, Immigration, and Population Growth Mega Trend Forecast - Part1 - Nadeem_Walayat
4.Gold and Silver Precious Metals Pot Pourri - Rambus_Chartology
5.The Exponential Stocks Bull Market - Nadeem_Walayat
6.Yield Curve Inversion and the Stock Market 2019 - Nadeem_Walayat
7.America's 30 Blocks of Holes - James_Quinn
8.US Presidential Cycle and Stock Market Trend 2019 - Nadeem_Walayat
9.Dear Stocks Bull Market: Happy 10 Year Anniversary! - Troy_Bombardia
10.Britain's Demographic Time Bomb Has Gone Off! - Nadeem_Walayat
Last 7 days
Dow Stock Market Trend Forecast 2019 May Update - Video - 20th May 19
A Brief History of Financial Entropy - 20th May 19
Gold, MMT, Fiat Money Inflation In France - 20th May 19
WAR - Us versus Them Narrative - 20th May 19
US - Iran War Safe-haven Reasons to Own Gold - 20th May 19
How long does Google have to reference a website? - 20th May 19
Tory Leadership Contest - Will Michael Gove Stab Boris Johnson in the Back Again? - 19th May 19
Stock Market Counter-trend Rally - 19th May 19
Will Stock Market “Sell in May, Go Away” Lead to a Correction… or a Crash? - 19th May 19
US vs. Global Stocks Sector Rotation – What Next? Part 1 - 19th May 19
BrExit Party EarthQuake Could Win it 150 MP's at Next UK General Election! - 18th May 19
Dow Stock Market Trend Forecast 2019 May Update - 18th May 19
US Economy to Die a Traditional Death… Inflation Is Going to Move Higher - 18th May 19
Trump’s Trade War Is Good for These 3 Dividend Stocks - 18th May 19
GDX Gold Mining Stocks Fundamentals Update - 17th May 19
Stock Markets Rally Hard – Is The Volatility Move Over? - 17th May 19
The Use of Technical Analysis for Forex Traders - 17th May 19
Brexit Party Set to Storm EU Parliament Elections - Seats Forecast - 17th May 19
Is the Trade War a Catalyst for Gold? - 17th May 19
This Is a Recession Indicator No One Is Talking About—and It’s Flashing Red - 17th May 19
War! Good or Bad for Stocks? - 17th May 19
How Many Seats Will Brexit Party Win - EU Parliament Elections Forecast 2019 - 16th May 19
It’s Not Technology but the Fed That Is Taking Away Jobs - 16th May 19
Learn to Protect your Forex Trading Capital - 16th May 19
Gold Ratio Charts Offer The Keys to the Bull Market - 16th May 19
Is Someone Secretly Smashing the Stock Market at Night? - 16th May 19
Crude Oil Price Fails At Critical Fibonacci Level - 15th May 19
Strong Stock Market Rally Expected - 15th May 19
US China Trade Impasse Threatens US Lithium, Rare Earth Imports - 15th May 19
Gold Mind Reader's Guide to the Global Markets Galaxy: 'Surreal' - 15th May 19
Trade Wars and Other Black Swan Threats to Your Investments - 15th May 19
Our Long-Anticipated Gold Momentum Rally Begins - 15th May 19
Defense Spending Is Recession Proof - Defense Dividend Stocks - 15th May 19
US China Trade Issues Will Drive Market Trends – PART II - 14th May 19
The Exter Inverted Pyramid of Global Liquidity Credit risk, Liquidity and Gold - 14th May 19
Can You Afford To Ignore These Two Flawless Gold Slide Indicators? - 14th May 19
As cryptocurrency wallets become more popular, will cryptocurrencies replace traditional payments? - 14th May 19
How US Debt Will Reach $40 Trillion by 2025 - 14th May 19
Dangers Beyond a Trade War with China - 14th May 19
eBook - Greatest Tool for Trading? - 14th May 19
Classic Pitfalls for Inexperienced Traders - 14th May 19

Market Oracle FREE Newsletter

U.S. House Prices Analysis and Trend Forecast 2019 to 2021

Could Energy Resources Cause Russia to Spark a Naval War in the Caspian Sea?

Politics / Russia Jul 11, 2011 - 08:00 AM GMT

By: OilPrice_Com

Politics

Best Financial Markets Analysis ArticleIn the past three decades the Islamic Republic of Iran has developed a well-earned sense of paranoia. First, in September 1980 Saddam Hussein invaded Iran in what he thought would be a quick military victory, but which quickly turned into an eight-year bloody slugfest, leaving an estimated 500,000-1,000,000 dead before the guns fell silent.


More recently Iran has been subjected to increasingly militant rhetoric from both Tel Aviv and Washington over its civilian nuclear energy program, with thinly veiled threats of possible military action if Tehran does not abandon its efforts, even though they are completely complaint under the terms of the Nuclear Non-Proliferation Treaty (NPT), which Iran has signed.

Now however, potential is brewing for Iran from an unexpected direction - the north.

Russia is sharply increasing its military presence in the Caspian. Russian Federation Navy Commander in Chief Admiral Vladimir Vysotskii has stated that Russia's Caspian Sea Flotilla will receive up to 16 new ships over the next decade, while some aviation units will be transferred to the Navy from the Russian military's southern operational-strategic command. What has really got to have the mullahs in Tehran fingering their worry beads however is Vysotskii's promise to provide the Caspian Sea Flotilla with Bastion shore-based missile systems armed with Yakhont hypersonic missiles, which are designed to destroy surface targets at distances of up to 200 miles.

Russia's Caspian Sea Flotilla flagship, the Tatarstan frigate, is already the most powerful vessel on the Caspian, armed with Uran missiles with a range of 100 miles. Later this year the Tatarstan will be joined by a sister ship, the Dagestan.

The Caspian Sea Flotilla is also taking delivery of the first in a series of new Project 21631 Buyan-M-class rocket-artillery ships, along with three amphibious assault ships.

The Iranian Navy has a total of approximately one hundred, mostly small combat and supports ships on the Caspian. They include three Iranian-made midget submarines (of a North Korean type that can transport a group of combat divers and have a range of 1,200 miles), an outdated Salman-class minesweeper (American-made), and patrol cutters.

Russian analysts believe that Iran however has the ability to increase its Caspian naval forces by 50 percent in short order by relocating craft from the Persian Gulf.

As for the other Caspian littoral states - Azerbaijan, Turkmenistan and Kazakhstan, their naval forces are negligible, to be polite.

So, why is Russia beefing up its naval presence?

The most likely reason is the one that has bedeviled the region for the last two decades - a final treaty delineating the ownership of the Caspian's offshore waters and seabed has yet to be signed. While Moscow and Tehran might agree about keeping the U.S. locked out of exploiting the Caspian's energy resources, worth an eye-watering $3 trillion, they remain at loggerheads over the issue of dividing the Caspian, with Russia insisting that each nation receive offshore waters in proportion to its coastline, while Iran insists that all five nations receive an equitable twenty percent apiece. Under the Russian definition Iran's share would be 11-13 percent.

Complicating the issue is that international law has yet to definitively designate whether the Caspian is an inland "sea" or a lake, an adjudication which has enormous implications for both the applicability of the 1982 U.N. Convention on the Law of the Sea and negotiation of the boundary demarcation regime affecting the littoral states' rights to significant undersea oil deposits.

Ironically, Iran has itself played the "gunboat diplomacy" card in the past. On 23 July 2001, an Iranian warship and two jets forced two Azeri research vessels, the Geofyzik -3 and the Alif Hajiyev, operating in what Azerbaijan calls the Alov oilfield on behalf of BP-Amoco, to leave the field where they were conducting surveys, which lies 60 miles north of Iranian waters. BP-Amoco immediately announced it would cease exploration activities and withdrew the research vessels. Azerbaijan denounced the move as a violation of its sovereignty and on 31 July charged that an Iranian reconnaissance aircraft had violated Azeri airspace and come within 90 miles of Baku. Ramping up the pressure, Iranian former Pasdaran Commander Mohsen Reza'i pointedly reminded Azerbaijan that the whole country had once been Iranian territory and that Iran might decide to take it back, even as the Iranian press speculated that the whole thing was a provocation cooked up by Azerbaijan who was scheming to bring about American intervention in the Caspian.

In the unlikely event that hawks in Washington ever considered, then or now, to fly the Stars and Stripes on the Caspian while taking a few potshots at the evil Russkies or the even more perfidious Axis of Evil mullahs, then geography seems to have thrown a spanner in the works, as the Caspian's sole exit point, the Volga-Don canal, is controlled by... Moscow.

What seems to be happening is that Russia has decided that gunboat diplomacy has its uses, and an upping of its naval presence in the Caspian might finally persuade Iran's obstinate mullahcracy that it's time to divvy up the Caspian pie according to Moscow's formula.

And, after all, 11-13 percent of $3 trillion is no small chunk of change, even to an OPEC member

Source: http://oilprice.com/Energy/Energy-General/...

This article was written by Dr. John CK Daly for Oilprice.com who offer detailed analysis on Crude Oil, Geopolitics, Gold and most other commodities. They also provide free political and economic intelligence to help investors gain a greater understanding of world events and the impact they have on certain regions and sectors. Visit: http://www.oilprice.com

© 2011 Copyright OilPrice.com- All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules