Tag Archives: oil

Britain, Mosul and Oil

My book on Britain’s Quest for Oil: World War I during the WWI and at the subsequent peace conferences will soon be published by Helion. The link below is to a post I wrote for Helion’s blog about Mosul. Great Powers wanted to control it and its oil even then.  WWI was not a war for oil. but it showed the vital need for secure supplies of oil. Mosul was the obvious place to obtain them as it was up for grabs after the collapse of the Ottoman Empire and there was little doubt that it contained large oil reserves, though they were not formally discovered until 1927.
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The First British Invasion of Basra, 22 November 1914

At the outbreak of the First World War Britain intended to send three forces from its Indian Army overseas. The largest, Indian Expeditionary Force A, was headed for France. IEF B and C were both to be sent to East Africa, the former to attack German colonies and the latter to defend British ones.

Once it became likely that the Ottoman Empire would enter the war on the side of the Central Powers an additional force, IEF D, was sent to Basra in the Persian Gulf, now part of Iraq but then Ottoman territory. The British in those days normally called modern day Iraq Mesopotamia.

The IEF sailed from India on 16 October. The Royal Navy’s role in the transport of IEF A and C was confined to protecting them from German cruisers by escorting them to their destinations. However, IEF B and D had to land on enemy territory.

IEF B arrived at Tanga in German East Africa (now Tanzania) on 2 November, landing the next day. On 4 November it was defeated by local German forces commanded by Paul von Lettow-Vorbeck. The defeated troops were re-embarked the next day.

The British Official History of Naval Operations suggests that defeat was owed ‘partly perhaps to insufficient artillery support from the sea.’[1] The expedition was accompanied only by the protected cruiser HMS Fox. The pre-dreadnought battleship HMS Goliath had suffered mechanical problems and the modern light cruisers HMS Chatham, Dartmouth and Weymouth were blockading the German light cruiser SMS Königsberg in the Rufiji River.

IEF D was intended to protect Britain’s interests in the Gulf, the most important of which were the oil refinery on the Persian (now Iranian) island of Abadan at the mouth of the Shatt at Arab river and the pipeline connecting it to the Persian oilfields. The oilfields, pipeline and refinery were owned by the Anglo-Persian Oil Company (now BP).

The Royal Navy had gradually switched from coal to oil in the 10 years leading up to the war. By 1914 the light cruisers and battleships under construction were to be fuelled exclusively by oil. This meant that it needed secure supplies, so in 1914 the Admiralty took a 50% stake in APOC and gave it a 20 year supply contract in return for providing the capital needed to develop the Persian oilfields.[2]

Admiral Sir Edmond Slade, the Admiralty’s oil expert, wanted troops to be sent to protect the oilfields:

‘It is…of urgent importance that the troops indicated should be sent at once in order to safeguard our supply of oil…This question of defence has nothing to do with the investment of Government capital in the Company…It is necessary in order to ensure the due supply of oil required for the Fleet.’[3]

On the other hand, Winston Churchill, who as First Lord of the Admiralty was responsible for the deal with APOC, disagreed with Slade, writing on his minute that ‘[t]here is little likelihood of any troops being available for this purpose. Indian forces must be used at the decisive point. We shall have to buy our oil from elsewhere.[4]

Churchill’s reluctance to protect the Persian oil installations appears surprising given his role in the government’s purchase of shares in APOC, but it is consistent with his pre-war opinion. In a 1913 Cabinet memorandum on naval oil supplies he assumed ‘that in time of war money would be no object.’[5] The objective of the APOC contract was to build up an oil reserve of six months’ wartime naval oil consumption relatively cheaply in peacetime.

The oil facilities were very important, but they were not Britain’s only interest in the region. It is now assumed that everything in the Middle East is about oil, but in 1914 General Sir Edmund Barrow, the Military Secretary to the India Office, argued that:

‘troops could be landed on Persian soil at Mohammerah [now Khorramshahr] or at Abadan island, ostensibly to protect the oil installation, but in reality to notify to the Turks that we meant business and to the Arabs that we were ready to support them… With the Arabs on our side a Jihad is impossible, and our Indian frontier is safe from attack.’[6]

Britain then had good relations with a number of Arab rulers who were nominally subjects of the Ottoman Empire but had a fair degree of autonomy. It feared that in a war with the Ottoman Empire the Ottoman Sultan, who was also the Caliph, might call a Jihad, resulting in a revolt by Britain’s Muslim subjects, especially in British India, which included modern Pakistan and Bangladesh.

Despite Churchill’s views IEF D was sent to the Gulf. It initially consisted of the 16th Brigade of the 6th (Poona) Division, commanded by Brigadier-General Walter Delamain.

There were only three small British warships in the region: the sloops HMS Espiègle and Odin of the Cadmus class and the Indian Marine ship Dalhousie. They were too small to deal with SMS Emden, which was known to be in the Indian Ocean, so IEF D was escorted by the pre-dreadnought battleship HMS Ocean, captained by Captain Arthur Hayes-Sadler, who was put in charge of the naval part of the operation.

IEF D reached Bahrain on 28 October. The next day the Ottoman fleet, commanded by the German Admiral Wilhelm Souchon, and including the battlecruiser Goeben and the light cruiser Breslau, attacked Russian bases in the Black Sea. On 30 October, Delamain was ordered to proceed to the Shatt-al-Arab and another brigade of the 6th Division, the 18th, was sent to the Gulf. The next day he was warned that war with the Ottoman Empire was imminent.

Lord Crewe, the Secretary of State for India, had given the following instructions to the Indian Government regarding the operation:

‘The intention is to occupy Abadan, with the Force under orders, protect the oil-tanks and pipe-line, cover the landing of reinforcements, in the event of such being necessary, and show the Arabs that our intention is to support then against the Turks.’[7]

The British force reached the sandbar in the estuary of the Shatt-al-Arab on 3 November. Two days later Britain declared war on the Ottoman Empire. The next day the convoy entered the Shatt, apart for Ocean, which was too big to cross the bar. A battery of four guns beside the ruined fort of Fao was quickly silenced by Odin and the position taken by a landing force of 600 men. An Ottoman force appeared near Abadan, but were dispersed by gunfire from Espiègle.

Source: http://commons.wikimedia.org/wiki/File:Meso-WW1-1.jpg Original Source: http://www.westpoint.edu/history/SiteAssets/SitePages/World%20War%20I/WWOne43.jpg This work is in the public domain in the United States because it is a work prepared by an officer or employee of the United States Government as part of that person’s official duties under the terms of Title 17, Chapter 1, Section 105 of the US Code

Source: http://commons.wikimedia.org/wiki/File:Meso-WW1-1.jpg
Original Source: http://www.westpoint.edu/history/SiteAssets/SitePages/World%20War%20I/WWOne43.jpg
This work is in the public domain in the United States because it is a work prepared by an officer or employee of the United States Government as part of that person’s official duties under the terms of Title 17, Chapter 1, Section 105 of the US Code

Delamain then took the rest of his brigade, two or three miles up the river and landed on the Ottoman side. By 10 November his troops, less a small garrison at Fao, were entrenched in a position that covered the oil refinery. An Ottoman attack on 11 November was beaten off.

The Ottoman telegraph cable from Upper Mesopotamia connected to the British one to Persia and India at Fao. The Ottomans had cut the cable, but the British quickly repaired it.

By 15 November the 18th Brigade and the artillery and divisional troops of the 6th Division had arrived. Its commander, Lieutenant General Sir Arthur Barrett, had instructions to take Basra. Intelligence from prisoners indicated that an attack by up to 10 Ottoman battalions was likely. A rapid victory was also likely to impress the Arabs, so Barrett decided to move on Basra quickly.[8]

Delamain’s brigade, plus two batteries of mountain artillery, defeated an Ottoman force at Saihan on 15 November. By the next day all the infantry and cavalry but only part of the artillery was ashore. Barrett decided to advance, with Odin, Espiègle, the armed yacht Lewis Pelly and the armed tug Sirdar-i-Naphte providing fire support from the river.

The main Ottoman force covering the route to Basra was attacked on 19 November at the mud fort at Kut-az-Zain. The Ottomans withdrew once the fort was destroyed by artillery and naval gunfire, but heavy rain turned the ground into a quagmire, meaning that the British cavalry could not turn the retreat into a rout. This action is referred to as being at Sahil by the British Official Histories.[9] “Sahil” is actually the local word for “shore”, so the name probably results from a misunderstanding.[10]

The Ottomans now made an attempt to block the Shatt-al-Arab using a Hamburg-Amerika liner that had been trapped in Basra and a number of smaller vessels. Barrett’s force was dependent on river transport, so this was potentially a very serious setback to his plans

On 19 November Hayes-Sadler went to investigate the obstacle in Espiègle. She came under fire from a shore battery of four 15 pounders, an armed launch and the gunboat Marmariss. Espiègle silenced the shore guns, sank the launch and forced Marmariss to withdrew without being hit herself. It then transpired that the passage was not completely blocked.

The Ottoman forces defending the approach to Basra and the city’s garrison withdrew the next day. By 5 pm on 21 November Espiègle, Odin and the newly arrived Indian Marine ship Lawrence were anchored off Basra’s Custom House. A blank round was fired in order to discourage looters, and naval parties were landed to deal with the fires that they had started. The first infantry arrived on the morning of 22 November.

The next day it was proclaimed that Basra was under British protection. The Sheikh of Kuwait was informed that Britain now recognised his territory as being an independent principality under British protection. The Ottoman Empire claimed it, but the Sheikh had placed himself under British protection by treaty in 1899.

The next stage of the campaign was an advance up river to Qurna, which was taken on 9 December. The initial objectives had then been achieved, but the Mesopotamian Campaign then grew as a result of mission creep. The capture of one place led to claims that somewhere else had to be taken to protect it. Easy early victories led to over confidence and there was a desire for further victories in a war that was going badly.

The lack of railways and roads meant that the Rivers Euphrates and Tigris were vital for communications, meaning that the RN continued to play an important role in this land campaign.

[1] J. S. Corbett, H. Newbolt, Naval Operations, 5 vols. (London: HMSO, 1938). vol. i, p. 374.

[2] M. Gibson, ‘”Oil Fuel Will Absolutely Revolutionize Naval Strategy”: The Royal Navy’s Adoption of Oil before the First World War,’ in A Military Transformed? Adaption and Innovation in the British Military, 1792-1945, ed. R. Mahoney, Mitchell, S., LoCicero, M. (Solihull: Helion and Company, 2014), pp. 110-23.

[3] NA, ADM 137/6, ‘Persian Gulf, Part 1, 30 July – 31 October 1914’, 1914.

[4] Ibid.

[5] NA, CAB 37/115/39, ‘Oil Fuel Supply for H.M. Navy’, 1913, p. 5.

[6] Quoted in F. J. Moberly, The Campaign in Mesopotamia, 1914-1918, 4 vols. (London: HMSO, 1923). vol. i, p. 87.

[7] PP, Mesopotamia Commission. Report of the Commission Appointed by Act of Parliament to Enquire into the Operations of War in Mesopotamia, Together with a Separate Report by Commander J. Wedgwood, D.S.O., M.P., and Appendices, HMSO 1917 [Cd. 8610]. p. 12.

[8] Moberly, Mesopotamia. vol i, p. 109.

[9] Corbett, Newbolt, Naval. vol. i, p. 389; Moberly, Mesopotamia. vol. i, p. 120.

[10] A. J. Barker, The First Iraq War, 1914-1918: Britain’s Mesopotamian Campaign (New York, NY: Enigma, 2009). This book was originally published in 1967 under the titles The Neglected War in the UK and The Bastard War in the US.

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The Past, Present and Future of Russian Energy Strategy – Stratfor

The  Past, Present and Future of Russian Energy Strategy is republished with  permission of Stratfor.”

Read more:  The Past, Present and Future of Russian Energy Strategy | Stratfor

By Lauren Goodrich and Marc Lanthemann

The future of Russia’s ability to remain a global energy supplier and the  strength the Russian energy sector gives the Kremlin are increasingly in  question. After a decade of robust energy exports and revenues, Russia is  cutting natural gas prices to Europe while revenue projections for its energy  behemoth, Gazprom, are declining starting this year.

Russia holds the world’s largest proven reserves of natural gas and  continually alternates with Saudi Arabia as the top oil producer. The country  supplies a third of Europe’s oil and natural gas and is starting to export more  to the energy-hungry  East Asian markets. The energy sector is far more than a commercial asset  for Moscow; it has been one  of the pillars of Russia’s stabilization and increasing strength for more  than a century. The Kremlin has designated energy security as the primary issue  for Russia’s national security, especially since recent changes in global and  domestic trends have cast doubts on the energy sector’s continuing strength.

Throughout Russian history, the country’s energy sector periodically has  strengthened and weakened. Managing this cycle has been a centerpiece of  Russia’s domestic and foreign policy since czarist times. This historical burden  now rests on Vladimir Putin’s regime.

Russia’s Imperatives and the Energy Factor

Russia is an  inherently vulnerable country, surrounded by other great powers and  possessing no easily defensible borders. In addition, Russia is a massive,  mostly inhospitable territory populated by diverse ethnic groups that  historically have been at odds with Moscow’s centralized authority. This leaves  Russia with a clear set of imperatives to hold together as a country and  establish itself as a regional power. First, Russia must consolidate its society  under one authority. Second, it must expand its power across its immediate  neighborhood to create buffers against other powers. (The creation of the Soviet  Union is the clearest example of this imperative in action.) Finally, it must  leverage its natural resources to achieve a balance with the great powers beyond  its periphery.

Russia has used a variety of tools throughout history to achieve these  imperatives, ranging from agricultural exports to pure military  conquest and intimidation. Starting in the late 1800s, Russia added energy to  the list of vital commodities it could use to achieve its central strategic  goals. By the 1950s, Russia’s energy sector had become one of the major pillars  of its economic and political strength.

The revenues from oil and natural gas exports show how the energy sector  empowered the Kremlin to consolidate the country. Energy export  revenues for the Russian Empire began flowing into government coffers  in the late 1800s, with oil export revenues making up 7 percent of the export  earnings. These revenues rose to 14 percent in the late 1920s during the early  stages of the Soviet Union, and by the 1950s accounted for half of Soviet export  earnings. Currently, energy revenues make up half of the  government’s budget. This capital influx was and continues to be  instrumental in helping Russia build the military and industrial basis needed to  maintain its status as a regional — if not global — power. However, as the  Russian governments became dependent on energy, the revenues also became a large  vulnerability.

Beyond export revenues, the energy sector has contributed to the creation of  a domestically stable and industrialized state. Russia’s  domestic energy consumption is very high due to extremely cold weather for  most of the year, but despite inefficiencies within the energy sector  and the cost of producing energy, the country’s domestic reserves have  enabled Moscow to provide its citizens and the industries that employ them with  low energy prices.

The energy sector also contributes to Russia’s ability to expand its  influence to its immediate neighbors. Moscow’s use of energy as leverage in the  buffer states differs from country to country and ranges from controlling  regional energy production (as it previously did in the Azerbaijani and Kazakh  oil fields) to subsidizing cheap energy supplies to the countries and  controlling the energy transport infrastructure. Russia has used similar  strategies to shape relationships beyond the former Soviet states. For instance,  Russia is one of Europe’s two main energy suppliers and is the only European  supplier with large reserves of oil and natural gas and historically cheap  prices. Russia’s physical connectivity with Europe and ability to undercut any  competitor have served as the basis of many of Moscow’s relationships in  Europe.

Evolution of Russian Energy Strategies

Energy’s usefulness as a means of achieving Russia’s three main imperatives  has altered over time because Russia has had to change its strategies depending  on shifts in domestic or international circumstances. Moscow’s strength lies in  its flexibility in managing its energy sector.

The importance of Russian energy was established in the late 1800s, when the  monarchy saw great potential for the Russian Empire if it could develop this  sector on a large scale. However, the empire had neither the technology nor the  capital to start up an indigenous energy industry. As a solution, the monarchy  eased its foreign investment restrictions, inviting European and U.S. firms to  develop the Baku and Volga oil fields. This brought about a brief period of  warmer relations between the Russian Empire and many Western partners,  particularly the United Kingdom, France and the United States. All parties soon  realized that the only way to make the Russian oil business profitable despite  the high costs associated with the country’s harsh and vast geography was to  transform Russia into a massive producer. By the turn of the century, the  Russian Empire was producing 31 percent of global oil exports.

As the importance of the Russian Empire’s energy sector grew, it became clear  that Russia’s internal stability greatly affected the sector. The Bolsheviks  used the energy sector in their attempts to overthrow the monarchy in the early  1900s. The oil-producing regions were one of the primary hubs in which the  Bolsheviks operated because energy was one of the few sectors with organized  workers. In addition, the Bolsheviks used the oil rail networks to distribute  propaganda across the country and abroad. In 1904, when the Russian Empire  cracked down on an uprising in St.  Petersburg, mostly Bolshevik protesters set the Baku oil fields  on fire. This cut Russia’s oil exports by two-thirds, forcing Moscow and the  foreign markets to realize oil exports’ great vulnerability to Russian domestic  stability.

Russia’s modern energy strategies began forming after World War II.  With the Soviet Union left standing as one of two global hegemons towering over  a divided Europe, Moscow saw no barriers to achieving dominance in the global  energy field. Between the 1950s and 1960s, Soviet oil output had doubled, making  the Soviet Union once again the second-largest oil producer in the world and  primary supplier to both Eastern and Western Europe. Revenues from oil  exports started to make up nearly half of Soviet export income.

Because the Soviet Union was producing oil en masse and the Soviet  system kept labor costs low, Russia was able to sell its oil at prices  almost 50 percent lower than oil from the Middle East. The subsidization of  oil to the Soviet bloc and then to Western European countries helped Moscow  undercut Western regimes and strengthen its position in its own periphery  — a strategy that the CIA dubbed the Soviet Economic Offensive. For the  Soviets, this was not about making money (although they were making money) as  much as it was about shaping a sphere of influence and undermining the West.  This strategy came at a cost, since Moscow was not bringing in as much revenue  as it could and was producing oil inefficiently, rapidly depleting its  fields.

In the 1970s, the price of oil skyrocketed due to a series of crises mostly  in the Middle East. At the same time, Russia was already feeling the strain of  sustaining the massive Soviet Union. Soviet leader Leonid Brezhnev’s regime was  left with a choice: use the high global prices as a reason to raise prices in  Eastern Europe and benefit the Soviet economy, or continue subsidizing the  Eastern bloc in order to keep it beholden to Moscow and not push it to start  thinking about other energy sources. It was a choice between two  imperatives: Soviet national stability and holding the buffer zone. In the end,  Moscow chose to protect its own interests and in 1975 raised the price of  oil for its customers, allowing for further increases based on global  market prices. By 1976, oil prices in the Eastern bloc had nearly doubled,  remaining below global prices but rising high enough to force some countries in  the bloc to take out loans.

The Soviet focus on maintaining high energy revenues continued through the  mid-1980s, when these revenues accounted for nearly all of the Soviet Union’s  hard currency inflows. But the Soviets were dealt a double blow in the mid-1980s  when the price of oil collapsed and the West imposed an embargo on Soviet oil,  prompting Saudi Arabia to flood the oil markets. Moreover, the Soviet Union was  falling far behind the West in technology, particularly in energy and  agriculture. In response, starting in 1985, the Soviet Union moved closer to a  market-based energy economy, raising prices for the Eastern bloc, requiring hard  currencies for payment and allowing foreign firms to re-enter the energy  sector.

But Russian strategy shifts were not deep and timely enough to prevent the  collapse of the Soviet Union. In the decade following the fall of the Soviet  bloc, the Russian energy industry was in disarray. The energy liberalization  that started under Mikhail Gorbachev in the 1980s was taken to an extreme under  Boris Yeltsin in the 1990s. As a result, production fell by half and the Russian  energy sector was divided between foreign groups and the emerging Russian  oligarch class.

This changed under Vladimir Putin in 2000. One of the first items on Putin’s  agenda to help stabilize the country was to consolidate the energy sector under  state control. This meant radically reversing the liberal policies from the two  decades before. The government effectively nationalized the majority of the  energy sector under three state behemoths: Gazprom,  Rosneft and Transneft. The Kremlin became more aggressive in negotiating supply  contracts with the former Soviet states and Europe, locking them into large  volumes at extraordinarily high prices because these customers had no  alternative energy supplies. The Kremlin also began cutting energy supplies to  certain markets — blaming troublesome transit states such as Ukraine — in  order to shape other political negotiations.

Though Moscow’s energy strategy became fairly aggressive, it helped bring  about a stronger and more stable Russia. Russian energy revenues soared due to  high global oil prices and the high natural gas prices it charged in Europe.  Russia had excess funds to pump into its political, social, economic and  military sectors. Energy politics also helped Russia leverage its influence in  its former backyard and forced Europe to step back from countering Russia’s  resurgence. Of course, the financial crises that swept Europe and Russia in  2008 reminded Russia of its need for its biggest energy clients when oil prices  dropped and demand began declining.

Challenges to Maintaining Russian Energy

Russia’s top concern is its vulnerability to fluctuations in the price of  energy. With half of the Russian budget coming from energy revenues (of that, 80  percent is from oil and 20 percent comes from natural gas), the government could  be crippled should energy prices fall. The Kremlin has already decreased its  budget projections for oil prices to $93 per barrel instead of $119 — though  even at that price, the government is playing a game of chance. Stratfor is not  in the business of forecasting oil prices, but historical patterns show that  major international crises and fluctuations in global consumption and production  patterns repeatedly have had sufficient impact on oil prices and on Moscow’s  revenues to destabilize the country.

Natural gas export revenues are also currently in question. With alternative  natural gas supplies coming online for Russia’s  largest consumer, Europe, the Kremlin has been forced to lower its prices in  recent months. This year, Gazprom expects to give European consumers  $4.7 billion — approximately 10 percent of Gazprom’s net revenues — in rebates  due to price cuts.

In its current configuration, Russia’s energy sector is under strain. The  consolidation of the sector mostly under two large state firms had many benefits  for the Kremlin, but after a decade of consolidation the disadvantages are  piling up. With little competition for Russia’s natural gas giant, Gazprom, the  firm is lagging in technology and is considered unfriendly to outside  investment. Russia’s oil giant, Rosneft, recently began evolving into a  larger monopoly like Gazprom, which could lead it to fall into a similar trap.  With future energy projects in Russia requiring more advanced technology (due to  their location and environment) and more capital, both Gazprom and Rosneft need  modernization and foreign investment.

Corruption is also a major factor, with varying estimates of 20 to 40 percent  of Gazprom’s revenues lost to either corrupt or inefficient practices. Rosneft  has similar problems. This loss would be sustainable with Moscow’s previous high  energy revenues, but it will not be sustainable in the future should energy  prices fall or the maintenance and expansion of the energy sector become more  expensive. The Kremlin is probing Gazprom, although with a culture of corruption  rampant throughout Russian history there is little the Kremlin will be able to  do to eliminate wrongdoing within the natural gas firm.

Moreover, Europe’s dependence on Russian energy is decreasing. The natural  gas shortages experienced throughout Europe during the Russian-Ukrainian  crises of 2006 and 2009 were a stark reminder of how vulnerable  European nations were because of their dependence on Russian natural gas  exports. Both unilaterally and through the European Union, European countries  began developing strategies that would allow them to mitigate not only Europe’s  vulnerability to disputes between Moscow and intermediary transit states, but  also its general dependence on energy from Russia.

The accelerated development of new and updated liquefied  natural gas import facilities is one such effort. This will give certain  countries — Lithuania and Poland, most notably — the ability to import natural  gas from suppliers around the globe and bypass Russia’s traditional lever:  physical connectivity. This is particularly significant in light of the  accelerated development of several unconventional natural gas plays in the  world, particularly the shale reserves in the United States. The development of  a pipeline project that would bring non-Russian Caspian natural gas to the  European market is another attempt — albeit less successful so far — to  decrease European dependence on Russian natural gas.

Additionally, a set of EU-wide policies, including the Third  Energy Package, has begun giving EU member nations the political and legal  tools to mitigate Gazprom’s dominance in their respective natural gas supply  chains. This common framework also allows European nations to present a more  unified front in challenging certain business practices they believe are  monopolistic — the latest example being the EU Commission probe into Gazprom’s  pricing strategy in Central Europe. This, coupled with the EU-funded efforts to  physically interconnect the natural gas grids of EU members in Central Europe,  has made it increasingly difficult for Russia to use natural gas pricing as a  foreign policy tool. This is a major change in the way Moscow has dealt with the  region for the past decade, when it rewarded closer ties with Russia with low  gas prices (as with Belarus) and increased rates for those who defied it (the  Baltics).

Finally, Russia faces the simple yet grave possibility that the escalating  financial and political crisis in Europe will continue to reduce the Continent’s  energy consumption, or at least preclude any growth in consumption in the next  decade.

Russia’s Next Move

The Putin administration is well aware of the challenges facing the Russian  energy sector. Russia’s attempts in the past decade to shift away from  dependence on energy exports by focusing on industrial development have not been  particularly successful and keep the country tied to the fate of its energy  sector. Russia’s strategy of using its energy exports as both a foreign  policy tool and a revenue generator is contradictory at times: To use energy in  foreign policy, Moscow must be able to lower or raise prices and threaten to cut  off supplies, which is anathema to the revenue-generating aspect.

Global and regional circumstances have changed to the point that Moscow has  had to prioritize one of the two uses of its energy industry — and it has  unequivocally decided to maintain its revenue-generating capability. The Kremlin  has begun crafting a set of policies designed to adjust the country to the  changes that will come in the next two decades.

First, Russia is addressing the very damaging uncertainty surrounding its  relationship with key transit states that traditionally allowed it to export  energy to Europe. The construction of the Ust-Luga oil terminal on the Baltic  Sea allows Russia to largely bypass the Belarus pipeline system and ship  crude and oil products directly to its consumers. Similarly, the construction of  the Nord Stream natural gas pipeline under the Baltic Sea — and eventually its  southern counterpart, South  Stream, through the Black Sea — will allow Russian natural gas to bypass  the Ukrainian and Belarusian transit systems if necessary. These two  pipelines primarily will ensure natural gas deliveries to the major European  consumer markets in Germany and Italy, with which Russia seeks to maintain  long-term strategic partnerships.

By allowing Russia to guarantee deliveries to its major European customers,  the bypass systems ensure Moscow’s vital energy revenues. This strategy of  future energy export flexibility will also progressively reduce the leverage  Minsk and Kiev can exert in warding off Moscow’s attempts at consolidating  Belarus and Kiev as vassal buffer states — one of the few foreign policy goals  Moscow is still intent on pursuing through energy strategy.

Moreover, Moscow has adapted its energy strategy with European customers amid  growing diversification and liberalization efforts. Gazprom has begun expanding  the natural gas discounts formerly reserved for strategic partners such as  Germany or Italy. The Kremlin knows that its only hope of maintaining natural  gas revenues in the face of a potential global shale boom is to lock its  customers into price-competitive, long-term contracts. Moscow will continue  showing that it can offer European consumers guaranteed high volumes and  low-cost deliveries that producers relying on liquefied natural gas shipping for  transport can seldom afford.

Finally, Russia is focusing significant attention and funds on developing  connections to the growing East Asian energy markets, diversifying its export  portfolio should challenges in the European market continue intensifying. One  aspect common to all the strategies Russia is set to pursue for the next decade  is the high capital needed to complete them; the Eastern  Siberia-Pacific Ocean oil pipeline alone is set to cost nearly $15  billion. Despite the effects of the financial crisis in 2009, Russia still has  vast capital reserves earmarked for these large-scale projects, but these funds  are not infinite.

The Kremlin appears keenly aware of the challenges that Russia will face in  the next two decades as another energy cycle draws to an end. Unlike  Brezhnev and Gorbachev, Putin has proven capable of enacting effective  policy and strategy changes in the Russian energy sphere. While Russia’s  dependence on high oil prices continues to worry Moscow, Putin has so far  managed to respond proactively to the other external shifts in energy  consumption and production patterns — particularly those affecting the European  natural gas market. However, the long-term sustainability of the model  Russia is moving toward remains doubtful.

Read more:  The Past, Present and Future of Russian Energy Strategy | Stratfor

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This is the abstract of my contribution to A Military Transformed? Transformation and Innovation in the British Military from 1792 to 1945, a forthcoming book edited by Ross Mahoney, Stuart Mitchell and Michael LoCicero of the University of Birmingham. The chapters are based on papers given at a conference in April 2011. See Ross’s blog, Thoughts in Military History, for more details on the book. He is in the process of adding the abstracts to his blog; they are all tagged ‘transformation.’

Birmingham "On War"

Here is the latest abstract from our forthcoming book.

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In 1900, most steamships were powered by coal, but the initial steps towards the use of oil had been taken. The first crossing of the Atlantic by an oil fired merchant ship took place in 1894. Several navies, including the Italian, Dutch, Russian and German ones, were using oil in some surface ships by 1900. Oil was superior to coal as a fuel for ships once the technology had been perfected. Replacing coal with oil allowed the construction of either a smaller ship of the same performance, or a better ship of the same size. The problem for Britain was security of supply; it possessed large coal reserves, but had little oil. Welsh steam coal was particularly suited to use by warships.

The RN observed and experimented until 1904, by when it had solved the technical problems. From then on…

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The Berlin-Baghdad Express: The Ottoman Empire and Germany’s Bid for World Power, 1898-1918 by Sean McMeekin

The Berlin-Baghdad Express: The Ottoman Empire and Germany’s Bid for World Power, 1898-1918 by Sean McMeekin is the story of German attempts to raise a Jihad against the Allies in the Middle East during World War I. Reviews have mostly been positive; negative ones on Amazon are mostly from readers who assumed from the first part of the title that was about the construction of the railway. That is part of the story, but a long way from being the whole of it. The second part of the title, The Ottoman Empire and Germany’s Bid for World Power, more accurately describes the book.

The story is of the strategy of the Central Powers, so concentrates on them, but the Allied response is not neglected. Russian, British, US and French archives have been used as well as Turkish, German, Austrian ones. An Epilogue discusses the impact of German wartime actions on the modern Middle East.

McMeekin manages to combine the telling of an exciting story with archival research. The number of characters can be hard to follow, but they are well drawn. He points out that German and Ottoman relations were often poor, and that their aims sometimes conflicted, especially in the Caucasus in 1918.
The Germans thought that that could use the power of Islam to bring down the British Empire. In fact, many Muslim leaders took German gold but did little in return, and often tried to play off Germany against Britain.

Logistics were a major problem for the Germans, who could not supply enough arms to their potential Muslim allies. The two main Ottoman victories over the British Empire, Gallipoli and Kut-al-Amara, resulted from German discipline and Turkish tenacity, not Islam. There isn’t a great deal on the main military campaigns.

The number of quotes from John Buchan’s novel Greenmantle are a bit strange in a non-fiction work. The author comments on the historiography of the Armenian massacres, but does not take a clear stance; he teaches at Bilkent University in Ankara, so may be constrained in what he can say. These are minor criticisms. The book is now out in paperback as well as hardback, and it is also available as an e-book.

This review is a slightly re-worded version of one that I originally posted on the Great War Forum, an excellent website for anybody interested in World War I. This link is to the thread that includes my review, and this one is to Forum’s home page.

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16 March 2012 · 5:57 pm

British Strategy and Oil, 1914-1923

I’ve recently completed a PhD at Glasgow University on ‘British Strategy and Oil, 1914-1923.’

This thesis analyses the significance of oil to British strategy during 1914-1923. It shows that by 1923 Britain had a coherent oil policy, which affected naval strategy, diplomatic relations, policy towards the oil industry and post-war aims in the Middle East. Previous works have looked at only part of the picture and have not appreciated the extent to which oil affected all these areas. This work brings all these different facets together into a single study. The most important British user of oil was the Royal Navy, which was replacing coal with oil as its principal fuel even before the First World War, which saw great growth in the use of oil. Aircraft and land vehicles powered by oil fuelled internal combustion engines transformed both warfare and civilian life, but their overall usage of oil was much less than that of the RN. British industry was slower than the RN to adopt oil because coal was cheaper; the RN put the technical advantages of oil ahead of cost.  Britain’s power and prestige was based on its naval supremacy; British dominance of naval fuel bunkering was a key factor in this. Britain had substantial reserves of coal, including Welsh steam coal, the best in the world for naval use, but little oil. Britain’s oil strategy in 1914 was to build up reserves cheaply in peacetime and to buy on the market in wartime. An oil crisis in 1917 showed that this was flawed and that secure, British controlled supplies were needed. The war created an opportunity for Britain to secure substantial oil reserves in the Middle East. Attempts to obtain control of these affected the peace treaties and Britain’s post-war relations with its Allies. The USA was then the world’s largest producer and was the main supplier to the Allies during the war. It believed, wrongly, that its output would decline in the 1920s and feared that Britain was trying to exclude it from the rest of the world. France also realised that it needed access to safe and reliable supplies of oil.  The largest available potential oilfield was in the Mosul vilayet, part of the Ottoman Empire in 1914, and now part of Iraq. The 1916 Sykes-Picot Agreement allocated about half of Mosul to France, which in 1918 agreed to include all of it in the British mandate territory of Iraq in return for a share of the oil and British support elsewhere. Other disagreements delayed an Anglo-French oil agreement, but one was finally signed at San Remo in 1920. It was followed by the Treaty of Sèvres with the Ottoman Empire, which appeared to give Britain all that it wanted in the Middle East. The resurgence of Turkey under Mustafa Kemal meant that it had to be re-negotiated at Lausanne in 1923. Sèvres angered the USA, since it appeared to exclude US oil companies from Iraq. For a period Britain focused on the need to have a large, British controlled oil company, but it was eventually realised that control of oil bearing territory was more important than the nationality of companies. This allowed US oil companies to be given a stake in Iraqi oil, improving Anglo-American relations. Britain’s need for oil meant that it had to ensure that the Treaty of Lausanne left Mosul as part of the British mandate territory of Iraq. Turkey objected, but the League of Nations ruled in Britain’s favour. Britain had other interests in the region, but most of them did not require control over Mosul. Mosul’s oil gave Britain secure supplies and revenue that made Iraq viable without British subsidies. By 1923 Britain had devised a coherent strategy of ensuring secure supplies of oil by controlling oil bearing territory.

The full thesis is available as a PDF from the university’s website:

http://theses.gla.ac.uk/3160/

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Bullets, Bombs and Bandages: How to Really Win at War: BBC4 TV

BBC4 has recently broadcast a very interesting three part series titled Bullets, Bombs and Bandages: How to Really Win at War. It was introduced by Saul David, Professor of War Studies at the University of Buckingham and explained the importance of planning, supply and logistics in war. Wars are won by the side with more supplies and better equipment, It has now finished, but is available, for UK viewers only, on the BBC I-Player until 28 February.

The first episode, ‘Staying Alive’, discussed the difficulties of keeping an army supplied with food. Archaeological evidence shows that the Romans shipped some foodstuffs from Spain to Hadrian’s Wall. Wellington’s army in Portugal and Spain during the Napoleonic Wars had to take a herd of cattle with it. An army of 80,000 men had to slaughter 300 animals per day. The invention of canned food eased supply problems, but early tin cans had to be opened with bayonets because the tin can was invented several years before the tin opener.

The second episode, ‘Stealing a March’, covered the difficulties of moving armies. In 1066, King Harold of England faced two threats. He quickly moved his army north to defeat Harald Hadrada’s Vikings at Stamford Bridge, but then had to return south to face William the Conqueror’s well prepared Normans. Harold’s army was depleted and exhausted, and he should have followed his mother’s advice and delayed giving battle. Instead he fought and lost.

Marlborough’s victory at Blenheim was one of logistics. His army used two-wheeled spring carts to transport its supplies. They were twice as fast as the farm carts used by his French and Bavarian opponents. In 1812, Napoleon expected to defeat Russia before winter. His army was equipped for summer, including the wrong type of horse shoes. A farrier explained that horses have to have different shoes in winter; Napoleon’s had summer shoes so could not grip the ice going up and down hills.

Railways enabled armies to be deployed more quickly and in greater numbers than previously. Helmuth von Moltke was one of the first to realise this, and his meticulous planning allowed the Prussians to mobilise more quickly than the French and to defeat them in the Franco-Prussian War. Railways allowed huge armies to be mobilised in World War I, but horses remained crucial in World War II because they were the fastest way of crossing rough ground until the invention of the jeep. The use of tanks and other motor vehicles made petrol supply vital; modern petrol cans are called jerry cans in the English-speaking world because they are based on a German design, which was more robust and practical than the British version.

Modern armies require huge amounts of supplies. The Allies required a port to keep their troops supplied after D-Day. Rather than capture one, they brought an artificial one, code-named Mulberry, with them. It was designed to last for nine weeks, but remained in use for nine months. Camp Bastion, Britain’s main supply base in Afghanistan, is a busier airport than Stansted. Despite all the modern equipment, losses of helicopters meant that British soldiers had to march to fight in the Falklands War.

See the BBC website for more on episode 2:

http://www.bbc.co.uk/news/magazine-16929522

The final episode, ‘Raising Arms’, dealt with the importance of having the best equipment and being able to afford enough of it. The Bank of England was founded in the 1690s after England ran out of money following wars with France and Spain. Sound finances enabled wars to be fought as equipment became more sophisticated and thus expensive. The increasing importance of artillery meant greater casualties, requiring more attention to medical facilities. Armies became more professional and technical, requiring better training.

In the late 19th century the increasing range of rifles meant that armies had to abandon colourful clothing, such as the British red coat, which was replaced by khaki. By 1908, British soldiers wore equipment that was designed from scratch for efficiency rather than adapting what had been used before. The British Lee-Enfield rifle had a shorter range than the German Mauser but was otherwise superior. Its magazine held 10 rather than 5 bullets and it had a bent bolt that enable the British soldier to keep his eye on the target whilst operating it, unlike the Mauser’s straight bolt.

In 1915 British machine guns and artillery were firing ammunition more quickly than it could be manufactured. A Ministry of Munitions was established and new factories built. Shortage of acetone, imported before the war, created problems with the manufacture of cordite. Chaim Weizmann, a chemistry lecturer at Manchester University, discovered a method of fermenting grain to produce acetone. In 1917 the British Empire produced over 50 million shells and a billion bullets and the Allies were out-producing the Germans. In 1917-18 the war cost £20 million per day in 2012 money.

Since World War I military power has been measured by the means of destruction rather than by numbers of men and horses. The Allies dropped 3.4 million tons of bombs in World War II. The USA dropped 7 million tons in the Vietnam War. Equipment is now stockpiled in peace, but this leads to risks of its own. An accident at an RAF munitions depot at Fauld in Staffordshire on 27 November 1944 caused one of  the largest ever non-nuclear explosions and killed more than 70 people.

The cost of military equipment continues to rise. The USA fired 800 Tomahawk cruise missiles in 48 hours during its Shock and Awe attack on Baghdad in 2003. Each costs $0.5 million. A Typhoon Eurofighter costs £50 million and the Joint Strike Fighter is likely to be twice as expensive. NATO’s opponents in Afghanistan are armed with little more than AK47s and home-made bombs, but this conflict has cost the UK £18bn. The question is knowing who the next enemy will be. The problem is that tipping points in military technology are not apparent until after the event.

See the BBC website for more on episode 3:

http://www.bbc.co.uk/news/magazine-17011607

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