Barking Dog - The Bigger the Bang, the Louder the Silence

Barry Wood of Voice Of America reports the comments of long time student of Russia, Marshall Goldman in Washington to the Jamestown Federation on the 7th December.

He says energy wealth and control over export pipelines have made Russia more powerful than at any time in its history. He said both eastern and western Europe have become dependent on Russia for oil and gas and that alternative supplies are not available. The recent boom in oil and gas prices, said Professor Goldman, has greatly boosted Russia's economic and political clout.

The recent increase in Russian oil production accounts for approximately 40% of the world's increase in oil production. The result is that Gazprom is now the third largest company in the world in terms of capitalized income, behind only ExxonMobil and General Electric. Last year the US imported 8Bn. worth of Russian oil.

While France, Germany and Italy have 30 %, 32 % and 40% of their energy imports originating from Russia, respectively, Poland, the Czech Republic and Slovakia have 63 %, 72 % and 91 % of their total energy imports coming from Russia. The Baltic States and Finland are completely dependent on Russia. This is putting a strain on the EU as the Western most states remain quiescent and compliant with Russia as they become increasingly reliant on gas for their energy needs.(UK especially) As Goldman puts it, Russia is becoming the Saudi Arabia of Europe.

Goldman says Russia has a long history of using oil and gas as a foreign policy tool.

"In the Soviet era they cut off the flow of oil to Yugoslavia under Tito, to Israel after Sinai, to China after Mao broke away, to Cuba, to Finland, and more recently to Lithuania because there is a dispute over who is going to control the refinery there that Yukos is trying to sell," he explained.

Goldman attributes President Vladimir Putin's popularity to the economic resurgence that the country is enjoying because of its high priced energy exports. Russia now has the world's third largest foreign currency reserves, after China and Japan. Mr. Putin's re-nationalization of state assets and moves against the economic oligarchs who wielded enormous power under Boris Yeltsin have been immensely popular - although the "siloviki," or Putin's close allies are now in charge. Putin has also nationaised the TV network and controls many newspapers, taking advice from Usbekistan's Karimov he is demanding registration of NGO's.

Professor Goldman says Russia's geographic position between Europe and Asia may make energy-hungry China vulnerable to Moscow, primarily because so many energy pipelines run through Russia.

"Just as the Europeans have become dependent on Russia for its gas, if the pipelines are built to China, the Chinese will become equally vulnerable," he added.

Russia, concludes Goldman, in just nine years has made an extraordinary transition from economic weakness to great strength. He credits President Putin with restoring national pride and ending the threat of political fragmentation within Russia.

Marshall Goldman discusses his book, (Audio real Player or downloadable MP3) Putin, Petroleum, Power and Patronage: The Dog Barks but the Caravan Moves On. HERE (Wellesley College - Monday, April 10, 2006) he also wrote the Piratisation of Russia.

This is a very important talk (and covers most of what he said to the Jamestown meeting) if you wish to understand what Putin's Russia is doing - very rapidly, to exercise it's muscles.

Putin (in theory) cannot run for re-election in 2008 .... don't put your mortgage on it.