Breaking the Bottleneck

 

Last November, the strategic sea gateway of the Dardanelles almost ground to a standstill from a lineup of 70 vessels seeking to transit through the narrow straits that separate the Black Sea from the Mediterranean. This gateway from north to south via the Turkish Straits is one of the most crowded sea gates in the world. The volume of oil flowing through has almost doubled since 1994 and will continue to grow in the early 21st century due to the high cost and long lead times involved in developing alternative routes.

Besides oil, the dense traffic includes liquid natural gas, chemicals and even explosives. The Bosporus, which lies within the city and port limits of Istanbul, is at its narrowest point only 700 meters wide. Navigation is hampered by several sharp turns that are particularly difficult for large tankers to negotiate.

The need for a breakthrough to supply satisfactory alternatives to the shipment of oil, in particular to Europe, has reached crisis point. Enter Russia.

Two recent developments will help Russia gain a strategic advantage over Europe’s traditional supplier, the Middle Eastern states. October saw the opening of a crucially strategic alternative when the Caspian Pipeline Consortium started shipping oil from the giant Tengiz oil field in Kazakhstan to the Russian port of Novorossiysk. Then in December, the Odessa-Brody Pipeline (obp) in Ukraine became operational.

Both developments provide workable alternatives in the flow of oil from Russia’s massive fields to the heartland of Europe.

With the EU increasingly dependent upon Russia for its energy supply, the obp is particularly important to supplying an alternative to the Dardanelles logjam by easing the flow of oil to the northwest—a tie-in with the giant Russian Druzhba pipeline. “Today, the Druzhba pipeline can handle 14.5 million tons of crude a year, and with the addition of pumping stations, it will be able to pump up to 45 million tons. A strategic bonus is the easy hook-up of the [obp] route to the refinery in Plotsk, Poland [due to join the EU in May], and a further link to the Baltic port of Gdansk” where oil could then go to Western markets. (www.eurasianet.org, Dec. 22, 2003).

One other pipeline project, although presently delayed due to environmentalist action, is the Baku-Tbilisi-Ceyhan pipeline, which will bring oil from Azerbaijani fields to the Eastern Mediterranean for export to Europe, Israel and the United States.

These projects demonstrate that the Caspian Basin is emerging as a viable source of energy, creating an attractive alternative to the Middle East and other traditional oil provinces.

Watch for tensions to rise between the crucial oil regions of Russia and the Middle East as these pipelines begin to give an edge to Russia—providing viable alternatives to the Dardanelles bottleneck for the free flow of oil to Europe and beyond.