Since the start of the Russo-Ukraine crisis, Putin-led Russia is giving jolts to the West by virtually obliterating every move by the US-led NATO. The oil and gas market was already under the control of Russia due to its closeness with OPEC. And now Russia has further tightened its grip on Europe by playing a new card in the grand game of geopolitics.
The project for an oil pipeline between Burgas in Bulgaria and Alexandroupolis in Greece has been officially revived by Bulgarian Energy Minister Rosen Hristov and his Greek counterpart, Kostas Skrekas, following several months of negotiations.
On Thursday, the pair signed an agreement to create a working group of the two countries to study the possibilities of implementing the project. Bulgarian President Rumen Radev who met his counterpart Katerina Sakellaropoulou as well as Prime Minister Kyriakos Mitsotakis was also in Greece as the agreement was signed.
“The Alexandroupolis – Burgas oil pipeline is of strategic importance to Bulgaria because it provides an opportunity for real diversification and alternative supplies of non-Russian oil to the refinery in Burgas – the largest in the Balkans,” Radev said at a briefing with Mitsotakis.
Understanding the origins of the project?
How did the idea of the project originate? The project was conceived at a time when the Black Sea had emerged as a primary area for the transport of energy to Europe and thence to the world market. Yet Turkey was insisting, partly for ecological and environmental reasons, on restricting the flow of energy through the Bosporus. This ruling has forced every energy producer in Russia and Central Asia to search for alternatives such as the Baku-Tbilisi-Ceyhan pipeline, and various schemes to transport oil across the Black Sea, and there came the idea of the new Burgas-Alexandroupolis pipeline which was to take oil from Kazakhstan through Russian pipelines and tankers to the Bulgarian port of Burgas and from there through Bulgaria and Greece to the port of Alexandroupolis. But beyond ecological and environmental restrictions on energy transport through the Black Sea Straits, these ventures each had considerable economic and political significance.
This new Russo-Bulgarian-Greek project underscored the complex economic and political rivalries that dot the region and Russia’s aim of using energy to establish its hegemony in the CIS. Russia controlled 51 percent of the project and the other two partners 24.5 percent each. The motives for Bulgaria and Greece were obvious: becoming major players in the energy field and gaining regular oil supplies, large transit fees, and opportunities for jobs and investments. But Moscow’s agenda was broader and more strategic.
Russia, therefore, intensified the pressure to bring the 13-year-long discussion of this project to fruition because of Turkey’s continuing restrictions on tanker trade in the Bosporus through which one-third of Russia’s oil flows. While the reasons given for this Turkish policy were environmental security, this trend has had the consequence of forcing more shipments through the Baku-Tbilisi-Ceyhan pipeline that does not cross Russian territory and which Moscow, therefore, does not support. The new project was thought to relieve pressure on the Bosporus and bypass Turkey as well as the BTC pipeline. And since it uses Kazakh oil, Moscow would keep the pressure on to ensure that this oil only reaches markets through routes it controls in order to keep Kazakhstan dependent upon it, just as it is trying to do with Turkmen gas to Ukraine.
Third, Washington was sponsoring a huge competing infrastructural plan for the Black Sea that would tie together Central Asian producers like Kazakhstan and Turkmenistan; Turkey, which has made clear its ambition to be a key regional distributor and pivot in the global energy trade and the Balkans while bypassing Russia. In other words, the Burgas-Alexandroupolis pipeline was the latest Russian move in an increasingly complex trans-continental rivalry over oil and gas pipelines from Russia, Central Asia, and the Caucasus to Europe and then to global markets. It also represented a Russian effort to outflank the recent moves by Kazakhstan to join the BTC pipeline and ship its oil through a projected Trans-Caspian pipeline under the Caspian Sea that Moscow opposed.
Since Greece and Bulgaria benefit greatly from the new pipeline and the possibilities for economic stimulation that it offers them, it is not surprising that they finally accepted this program. The project however never came to life, as it was stopped by a local referendum on ecological grounds.
Understanding the current oil crisis:
Fast forward, let us talk about the current global oil crises induced by the Russo-Ukraine War.
Russia supplied nearly 40% of the European Union’s gas consumption last year, therefore the bloc is attempting to quell the crisis brought on by Moscow’s gas supply cuts. As the worst energy scenario for Europe becomes a reality, it has come to the realisation that the US can do nothing to save Europe from an imminent catastrophe. Biden’s misguided policies have already caused considerable chaos in the US, which is also experiencing a serious gas and oil problem. Gasping for oil and energy supplies, the Western nations are trying with all their might to secure energy supplies. The revival of the project should be seen as an extension of this.
Greece and Bulgaria’s discontentment:
But why did Greece and Bulgaria decide to revive a project that has a Russian link and that too, without bringing the EU to the table?
Well, the European Union has failed to cater to the needs of these nations. The European Union has always favoured, albeit tacitly, Turkey which is Greece’s geopolitical foe.
Greece and Turkey have long been at odds with one another. The two nations created their national identities and fought their independence wars against one another. With each passing day, historical hostilities have simply grown more intense. Through education, history, and literary works, the stereotypes of the enemy have been reinforced over time in both countries.
So, to see the Union being prejudiced in favour of Turkey would surely lead to some radical action on Greece’s part. We have already seen Greece publicly rejecting NATO’s foreign policy goals. To snub the EU is no big beer, then.
Similarly, as we have discussed here at TFI, Bulgaria, which had previously taken an indecisive and unsure stance on the Russia-Ukraine conflict, has finally come to its senses. Sofia is now in Moscow’s camp, and the grave consequences of backing sanctions against Russia are catching up with it. As a result, in order to avoid additional political and economic disasters, Bulgaria has adopted a pro-Russian diplomatic strategy and foreign policy.
Bulgarian President Rumen Radev made statements at the EU meeting on February 9th that contradicted the majority of his peers. He advocated for peace in Ukraine at a time when President Volodymyr Zelenskyy was set to visit Brussels to beg for more armaments to liberate Russia-occupied territories.
The new dispensation, led by President Rumen Radev has time and again taken steps that go against the trajectory defined by the EU.
At the end of last year, Russian oil company Lukoil vigorously backed the idea of resuming work on the oil pipeline construction project. Lukoil claims the project could help replace the Russian oil it currently imports by tanker through the port of Rosenets.
Eventually, such a massive enterprise, which began with Moscow’s ambitions, would have to bring Russia at some point.
Years ago, the project was intended to deliver Russian oil to the Aegean via the Bosphorus, but it was halted by a local referendum on ecological grounds. This time, the project is intended to transport oil from the Middle East and other sources to the Bulgarian port city of Burgas on the Black Sea, where the only Bulgarian refinery, owned by Lukoil, is located. Make no mistake: at some point, this oil pipeline may rebrand itself Burgas-Alexandroupolis and begin shipping Russian oil. Ultimately, Russia will have the last laugh, while the EU would continue to weep.
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