Robert M. Cutler on Energy and Eurasia

First published in Focus [Center for Post-Soviet Studies] 3, no. 11 (November 1996), pp. 1–2.

With the dismantlement of the inherited Soviet nuclear arsenal now under way, it is the apparent lack of well defined long-term goals (apart from "stability") that largely account for Washington's inability to clarify the nature of its engagement in Central Asia, leading it to deal with immediate issues (such as the Tajikistan situation) on a piecemeal basis. There are, however, at least two key areas of central Asian concern (not counting the burgeoning drug trade or the Tajikistan civil war) that directly engage "vital" U.S. interests. These areas are nuclear nonproliferation and energy security.

Invited Speech to the Plenary Session "Caspian Sea Resources", Monaco Summit on Energy (Crans Montana Forum in Monaco sponsored by UNIDO). [Material from this speech was incorporated into the 1999 Global Governance article, "Cooperative Energy Security in the Caspian Region: A New Paradigm for Sustainable Development?"

First published in FSU Oil & Gas Monitor, No. 22 (9 March 1999): 7-8. Copyright © Robert M. Cutler.

Iran, Iraq, and Turkey continue to dominate energy developments in Southwest Asia. Current events make it imperative to assess the state of play in the region as a whole. This week's column analyzes the significance of recent developments for the former Soviet area.

FSU Oil & Gas Monitor, No. 34 (1 June 1999): 2. Copyright © Robert M. Cutler.

In the early 1990s, the Caspian oil exploration was like a high-ante, high-stakes game of poker with several rounds of draw and a large (but unknown) number of wild cards. A lot of the players frankly acted like cowboys shooting from the hip, and there was a lot of bluffing as well. It was, moreover, a "table stakes" game: if you couldn't meet the level of the bet when it came your turn to call, you had to clear out or find some kind of collateral, usually by signing an IOU to another player who would back you and split any winnings. This is why consortia were established: to pool resources and intelligence.

First published in Central Asia - Caucasus Analyst, vol. 2, no. 4 (16 February 2000): 3-4. Copyright © Robert M. Cutler.

SUMMARY: President Islam Karimov's reelection in Uzbekistan has been followed by his statement that a program of economic liberalization and privatization will now be introduced in the country. Currency controls on the Uzbek som and its less than full convertibility, have been the greatest roadblocks to the overall development of the Central Asian trading block, called the Central Asian Union, that includes Uzbekistan, Kazakhstan, Kyrgyzstan, and Tajikistan. If barriers including bilateral trade tariffs can be overcome, the Central Asian Union holds the greatest potential to reanimate regional trade throughout the Central Asian region.

Dissatisfaction among ethnic Russians in Kazakhstan is growing. Many have left since the country gained independence, and those who remain are feeling increasingly frustrated and excluded by "Kazakhization" policies.
Emigration has caused a significant decline in Kazakhstan's overall population, far outpacing the higher birth rates of those remaining.

First published in Central Asia - Caucasus Analyst, vol. 2, no. 8 (12 April 2000): 7-8. Copyright © Robert M. Cutler.

SUMMARY: Secretary of State Madeleine Albright arrives April 14 in Kazakhstan, on the first leg of a week-long tour of Central Asia that will also take her to Kyrgyzstan and Uzbekistan. The visit occurs against a backdrop of increasing Russian diplomatic activity in the region in the period since Vladimir Putin's appointment as Acting President by Boris Yeltsin and subsequent election in his own right. This coincidence opens speculation about United States-Russian relations in Central Asia and the directions Central Asian countries themselves will choose to chart their futures.

First published in Foreign Policy in Focus, March 2001, pp. 1-2. Copyright © Robert M. Cutler.

A new report by the International Crisis Group (ICG) helps answer the question about what the appropriate responses are to Islamic militancy in Central Asia. The ICG is a highly respected, well connected, expert, private, multinational organization that describes itself as "committed to strengthening the capacity of the international community to anticipate, understand, and act to prevent and contain conflict." In its new report titled "Central Asia: Islamist Mobilisation and Regional Stability," ICG makes recommendations to Central Asian governments, external powers, and international organizations.

First published in FSU Oil and Gas Monitor, No. 129 (25 April 2001): 6-8. Copyright © Robert M. Cutler.

The opening, or at least the beginning of the filling, of the oil pipeline of the Caspian Pipeline Consortium (CPC), from the Tengiz field in northwest Kazakhstan to Novorossiisk on the Russian Black Sea coast, received deserved if extended -- indeed sensational -- publicity several weeks ago. The CPC line is, after all, the first new pipeline to be built from the Caspian region since the demise of the Soviet Union. The pumping of oil into the pipeline began belatedly, but it is now expected that the first tanker will be filled in Novorossiisk in June.

All the attention paid to western Kazakhstan makes it difficult for most observers to gain an understanding of the overall energy balance in Central Asia. For example, sight is often lost of Uzbekistan's regional role as an energy producer because of its two better-endowed neighbors, Kazakhstan and Turkmenistan. Yet as explained below, Turkmenistan does not really come into play although it is certainly a regional actor; rather, Kazakhstan and Uzbekistan are the main players on the scene. This article calls attention to overlooked aspects of the Central Asian energy balance, with special attention paid to Kazakhstan and Uzbekistan and the contrasts between them and the significance of those contrasts.

First published in Central Asia - Caucasus Analyst 3, no. 14 (4 July 2001): 5-6. Copyright © Robert M. Cutler.

SUMMARY: Only days before the Putin-Bush meeting in Ljubljana, an even more significant meeting took place in Shanghai between Putin and Chinese President Jiang Zemin, within the framework of the mechanism known until recently as the "Shanghai Five" or "Shanghai Forum". At the Shanghai meeting, Uzbekistan was welcomed as the institution's sixth full member. Documents were adopted bearing the titles, "Declaration of the Establishment of the 'Shanghai Cooperation Organization'" and the "Shanghai Covenant on the Suppression of Terrorism, Separatism and [Religious] Extremism". The name-change signals a move to establish a formal structure with a permanent secretariat in Shanghai, and to promote multilateral interministerial cooperation across a wide range of issue areas. It also signals, if one takes Beijing at its word, the incipient coalescence of a Sino-Russocentric geopolitical bloc in Asia. China's vision for such a bloc is to countervail any strategic vision that puts the United States at the forefront of twenty-first century global politics.

First published in Foreign Policy in Focus, 4 October 2001, pp. 1-2. Copyright © Robert M. Cutler.

In its new war on terrorism, Washington is quickly moving to put its "strategic partnership" with Uzbekistan to work. It has already turned to Uzbekistan's President Islam Karimov, who has spent the past decade cracking down so hard in his own country that he has driven the possibility of loyal Islamic dissent out of the political arena, and is now targeted by the Taliban-backed Islamic Movement of Uzbekistan (IMU), with which there have been military clashes over the past two years.

First published in Foreign Policy in Focus, 19 October 2001, pp. 1-2. Copyright © Robert M. Cutler.

The air strikes on Afghanistan put U.S. policy in Central Asia in a delicate position. On the one hand, Central Asian governments will be tempted to harden further their authoritarian domestic policies toward dissent and opposition, driving people further toward Islamic-based protest. If popular opinion in the region comes to identify the U.S. too directly with those policies, then the post-authoritarian transitions could see widespread Islamic militancy, tied to anti-Americanism, come to the fore.

First published in Foreign Policy in Focus, 11 November 2001, pp. 1-2. Copyright © Robert M. Cutler.

Just when it looked the Central Asian countries were facing the growing joint political hegemony of Russia and China in the region, the events of September 11 opened the door to an increased and indefinite-term U.S. military presence.

First published in Central Asia - Caucasus Analyst, vol. 6, no. 18 (8 September 2004): 8-9. Copyright © Robert M. Cutler.

SUMMARY: The supergiant Karachaganak energy field, onshore in northwestern Kazakhstan, sends gas for processing over the Russian border to a processing plant in Orenburg operated by Gazprom. Production is slated to increase. The joint operators of the Karachaganak gas venture, BG and ENI, together with the Government of Kazakhstan, are considering building a plant on-site in Karachaganak to process the new volumes. Gazprom argues against this and is trying to offer incentives to send the gas instead to an expanded Orenburg plant. The eventual decision, coming soon, will have significant implications for how Kazakhstan's national pipeline system develops in the future.

First published in Central Asia -­ Caucasus Analyst vol. 6, no. 20 (6 October 2004): 5-­6. Copyright © Robert M. Cutler.

On September 19, Kazakhstan held the first round of elections for a new Majilis (lower parliamentary body). Second-round run-offs are being held on October 3, but the first round already established the contours of the complete results. In addition to parties formed around the persons of President Nursultan Nazarbaev (Otan) or his daughter Dariga Nazarbaeva (Asar), the technocratic Democratic Choice of Kazakhstan (DCK) and Ak Zhol, which emerged from it, were among those running candidates. The conduct of the elections was better than in other Central Asian states, but exit polls were diverged markedly from the official results, which give Otan a majority in the chamber. Important structural impediments to de-authorization and democratization remain, but they are not insurmountable. However, the longer reform is delayed, the more endemic they will become.

Excerpt from Voice of America report by Luis Ramirez, "Politics of Oil Dominate Shanghai Summit" (16 June 2006):

Analysts say the United States has reason to watch closely for signs of anti-American sentiments at the SCO. Robert Cutler, a senior research fellow at Carleton University in Canada, says the underlying purpose of the organization is for Russia and China to assert their influence in Central Asia. He says this is especially true of China, with its bid to secure energy resources.

Excerpt from Voice of America report by Peter Fedynsky and Victor Morales, "Slow Progress on Reforms in Kazakhstan" (29 September 2006):

Robert Cutler with the Institute of European and Russian Studies at Carleton University in Ottawa, Canada, "The thing to understand about Kazakhstan is that there is political pluralism. But it is extremely restricted to a relatively not very numerous political elite. There have been opposition movements within this political elite, trying to liberalize things for the simple purpose of economic rationality. And the political conflict is really amongst this political elite. The mere fact that someone you know [as a fellow political elite] can be found murdered creates a little uncertainty and it makes people uneasy. [Opposition leader and former Information Minister Altynbek Sarsenbaev was murdered in February 2006.] There's a sense that something has got to change. But as is often the case, things are not going to change much so long as the autocrat[, Nursultan Nazarbayev,] is still in place."

First published in Asia Time OnLine, 28 February 2007. Copyright © Robert M. Cutler.

A significant indicator of Turkmenistan's future diplomatic and economic course is whether new President Gurbanguly Berdymuhammedov will undertake a rapprochement with Azerbaijan.

A little over a month ago, Kazakhstan’s President Nursultan Nazarbaev signed amendments passed several weeks previously by the Majilis (parliament) to the law “On the Subsurface and Subsurface Use” that would allow the government to amend or annul natural-resource contracts if these are judged to threaten the country’s national security. This dispute indicates the changing nature of Kazakhstan’s energy sector.