The Great Caspian Arms Race
Inside the petro-fueled naval military buildup you’ve never heard of:
It’s Russia versus Iran, with three post-Soviet states — and
trillions of dollars in oil — in the middle.
BY JOSHUA KUCERA | JUNE 22, 2012
The Caspian Sea, once a strategic backwater, is quickly becoming a
tinderbox of regional rivalries — all fueled by what amounts to trillions
in petrodollars beneath its waves. Observers gained a first glimpse into
this escalating arms race last fall, when Russia and Kazakhstan held joint
military exercises on the Caspian,
which abuts Iran and several former Soviet republics. Russia’s chief of
general staff framed it as a precautionary measure related to developments
in Central Asia, saying it would prepare for “the export of instability
from Afghanistan after the withdrawal of NATO troops from there.”
But a scoop by a Russian newspaper, *Moskovsky Komsomolets*, told a
different story. The newspaper* *got hold of a map apparently showing the
real scenario of the exercise:
the defense of Kazakhstan’s oil fields from several squadrons of F-4,
F-5, and Su-25 fighters and bombers. The map didn’t name which country
the jets came from, but the trajectory and the types of planes gave it
away: Iran.
While the world focuses on the possibility of an Israeli attack on Iran, a
little-noticed arms buildup has been taking place to Iran’s north, among
the ex-Soviet states bordering the Caspian. Twenty years after the collapse
of the Soviet Union created three new states on the sea, their boundaries
have still not been delineated. And with rich oil and natural gas fields in
those contested waters, the new countries — Azerbaijan, Kazakhstan, and
Turkmenistan — are using their newfound riches to protect the source of
that wealth. So they’re building new navies from scratch, while the two
bigger powers, Russia and Iran, are strengthening the navies they already
have. It all amounts to something that has never before been seen on the
Caspian: an arms race.
The biggest reason for this buildup may be mistrust of Iran, but it’s not
the only one. The smaller countries also worry about how Russia’s naval
dominance allows Moscow to call the shots on their energy policies. Iran
and Russia, meanwhile, fear U.S. and European involvement in the Caspian.
All of this, among countries that don’t trust each other and act with
little transparency, is setting the stage for a potential conflict.
For the last several centuries, Russia has been the undisputed master of
the Caspian. Tsar Peter the Great created Russia’s Caspian Flotilla in
1722, and a quote from him still shines on a plaque at the flotilla’s
headquarters: “Our interests will never allow any other nation to claim the
Caspian Sea.” Until now, that’s pretty much been the case. Because the
Caspian was a relative strategic backwater for most of history, no one
cared enough to challenge Russia. The Soviet Caspian Fleet, based in Baku,
was perhaps best known for a novelty, the “Caspian Sea Monster,
a massive experimental hovercraft/airplane.
Since 1991, however, the Caspian has started to matter. While the Caspian
may still be marginal to Iran or Russia, it is of crucial strategic
importance to Azerbaijan, Kazakhstan, and Turkmenistan. Upon gaining
independence, those three countries quickly contracted with Western oil
majors to explore the untapped resources in the sea, and discovered a
fortune capable of transforming their economies. Caspian energy expert (and
FP contributor) Steve LeVine estimates that the sea contains about 40
billion barrels of oil, almost all of it in the areas that those three
countries control.
The issue of who controls what, however, is a tricky one. While certain
pairs of states have worked out bilateral treaties dividing the sea between
themselves, some boundaries — most notably those involving Iran — remain
vague. In addition, the legality of building a “Trans-Caspian Pipeline”
under the sea* *(as Turkmenistan would like to do, to ship natural gas
through Azerbaijan and onward to Europe) is unclear, and both Russia and
Iran oppose the project.
This uncertainty has contributed to several tense incidents on the
Caspian over the last few years. In 2001 Iranian jets and a warship
threatened a BP research vessel prospecting on behalf of Azerbaijan in
waters that Baku considered its own. In 2008, gunboats from
Azerbaijan’s coast guard threatened oil rigs operated by Malaysian and
Canadian companies working for Turkmenistan near the boundary between
those two countries. And in 2009, an Iranian oil rig entered waters
that Azerbaijan considered its
own, prompting Azerbaijani officials to fret that they were powerless
against the Iranians, Wikileaked diplomatic cables show.
And so all five countries on the Caspian have taken significant steps to
build up their navies in recent years. Russia’s Caspian Flotilla is by far
the strongest of the lot, but that hasn’t stopped Kremlin officials
from publicly
worrying the fleet is
“uncompetitive,” and declaring that they are taking steps to cement its
superiority.* *Russia’s second frigate for the flotilla is currently
undergoing sea trials in the Black Sea and should be transported to the
Caspian later this year — part of a
planto add 16 new ships to the
fleet by 2020. Russia is also building up its
naval air forces in the region, and establishing coastal missile units
armed with anti-ship rockets capable of hitting targets in the middle of
the sea.
“The military-political situation in the region is extremely unpredictable.
This is explained on one side by the unregulated status of the sea, and
from the other, the aspirations of several non-Caspian states to infiltrate
the region and its oil and gas,” the Russian magazine *National Defense*,
in a not-so-oblique reference to the United States and Europe,* *wrote* *in
a special report this year on the Caspian naval buildup. “In these
conditions Russia is compelled to look after the security of its citizens
and the defense of the interests of the Caspian countries.”
Iran is the second power on the Caspian, and while it keeps details of its
posture on the sea under close wraps, its growing presence is impossible to
miss. Iran has built up its navy on the Caspian from nearly nothing during
the Soviet era to a force of close to 100 missile boats, two of which are
equipped with Chinese C-802 anti-ship missiles. And Tehran has announced
that it’s building a “destroyer,” which will become the largest ship in its
Caspian fleet (though probably closer to a corvette by international
standards).
The other three countries on the sea inherited some decrepit vessels from
the former Soviet Caspian flotilla, which they augmented with donations of
small patrol boats by the United States in the early days following
independence. But all now appear serious about developing real navies.
Turkmenistan, for example, is building a naval base and naval academy in
the coastal city of Turkmenbashi and has bought two Russian missile boats,
with plans to buy three more, as well as Turkish patrol boats.
Kazakhstan launched its first proper naval vessel this year — a
domestically built missile boat — with plans to buy two more. It also
recently contracted with South Korean shipbuilder STX to help develop its
shipbuilding capacity. A recent arms
expoin Kazakhstan’s capital of
Astana drew a substantial number of shipbuilders
and other naval arms producers from Europe, Turkey, and Russia, and
Kazakhstan appears poised to buy Exocet anti-ship missiles from European
consortium MBDA.
Azerbaijan has been the relative laggard, focusing nearly all of its
booming defense budget on land and air forces designed to win back the
disputed territory of Nagorno-Karabakh, now controlled by Armenian forces.
But it too has lately shown signs of focusing more on Caspian security,
buying anti-ship missiles from
Israel.
Adding a few frigates here and a few corvettes there, of course, doesn’t
mean the Caspian is the next South China Sea; the firepower and the
geopolitical tension on the sea are still low enough that the Caspian is
far from “flashpoint” status. But the trend is moving in a dangerous
direction. The five countries on the Caspian are all so opaque about their
intentions that there is plenty of room for miscalculation, leading to a
disastrous conflict that no state truly wants. It is also particularly
ironic because all the governments officially call for demilitarization of
the Caspian. Most of the countries justify their Caspian naval buildups in
light of this rhetoric by citing a threat from terrorists or piracy —
though there has been nearly no indication of either the intent or ability
of terrorists to attack.
In reality, the Caspian is a classic case of the security dilemma, in which
defensive moves can be perceived by neighbors as offensive ones. “Even if
we don’t want to spend that much money on naval militarization, we end up
spending it to keep up with all the threats,” says Reshad Karimov, an
analyst at Baku’s Center for Strategic Studies. “If someone is too safe, no
one is safe.”
The tension on the sea takes many forms. All of the post-Soviet states
mistrust Iran, especially Azerbaijan. “How will we react if tomorrow Iran
decides to install one of their oil wells in some territory that we
consider ours?” asks Tahir Ziyadov, a scholar at the Azerbaijan Diplomatic
Academy. “Maybe some crazy guy, because he got frustrated by
Azerbaijan-Israeli relations, tomorrow he will declare, ‘Go and install
that well over there.’ The possibility of serious tension is there, and
Azerbaijan will attempt not to allow it.”
Russian opposition to the proposed Trans-Caspian Pipeline is another
potential source of conflict. The United States and Europe have been active
in promoting the pipeline, which would allow Turkmenistan to export natural
gas to Europe, while bypassing Russia. But commentators in Moscow have
occasionally threatened force if a pipeline were to go ahead. “The reaction
can be very hard, up to some sort of military conflict in the Caspian Sea,”
said Konstantin Simonov, director general of the Russian think tank,
National Energy Security Fund, in an
interviewlast year.
“Russia is the wildest card in the deck — they have so many ways to mess
things up. They have the resources, they have the firepower, they have
established the political will to do that,” Karimov said.
Meanwhile, just this week, the two would-be partners in the Trans-Caspian
Pipeline, Azerbaijan and Turkmenistan, traded
accusationsabout
the disputed oil field that was at the heart of their 2008 standoff.
Russia and Iran both appear motivated to keep foreign (especially U.S. and
European) influence out of the Caspian. The U.S. has offered some modest
military assistance to help the new countries bolster their defenses on the
Caspian, including donations of some patrol boats and training of
Azerbaijani naval special forces. And it’s clear from WikiLeaked U.S.
diplomatic cables that Azerbaijan in particular relies heavily on U.S.
advice for naval issues.
Baku also appears to be using the escalating tensions on the sea to press
for greater help — and U.S. officials appear receptive to their requests.
During the 2009 incursion of the Iranian oil rig into Azerbaijani waters,
several high-level Azerbaijani officials consulted with U.S. diplomats and
military officials. One official in Baku
fretted:
“You know our military capacity on our borders. We do not have enough
capacity. We need military assistance.” In a later cable, one U.S. diplomat
said the incident “offers a timely opportunity to gain traction on Caspian
maritime cooperation with the [government of Azerbaijan].”
Russia, and especially Iran, tend to see this activity on the Caspian as an
encroachment on their strategic backyard, and they delivered thinly veiled
warnings against “third parties” getting involved in the region. “Iranians
think they are a besieged fortress,” said a Baku naval analyst who asked
not to be named. “The U.S. cooperation here is nothing special but they
build conspiracy theories about it.” Meanwhile, Azerbaijan’s strong
military relationship with Israel only adds to Iran’s suspicions.
The United States, however, has vowed to expand its involvement in the
Caspian and appears determined to help the smaller countries stand their
ground against Russia and Iran. The most recent U.S. State Department military
assistance plans
call for aid
to “to help develop Azerbaijan’s maritime capabilities and
contribute to the overall security of the resource-rich Caspian Sea.”
Meanwhile, the tension seems destined to rise. Iran recently announced a
huge new oil discovery in the Caspian, which Tehran says contains 10
billion barrels of oil.* *While Iran hasn’t yet announced the exact
location of the find, the information it has put out suggests that the
discovery, according to regional analyst Alex
Jackson,
is in “what would reasonably be considered Azerbaijan’s waters.”
As the vast wealth at stake in the Caspian becomes clearer, expect all
parties in this new battleground to deploy ever more sophisticated weaponry
to defend their interests. No word yet on when Azerbaijan is taking
delivery of those Israeli anti-ship missiles.
http://www.foreignpolicy.com/articles/2012/06/22/the_great_caspian_arms_race
http://redbannernorthernfleet.blogspot.com/2010/02/excellent-photo-essay-on-caspian-sea.html
http://www.rferl.org/content/article/1097012.html
http://www.eurasianet.org/node/65542
http://www.foreignpolicy.com/articles/2012/06/22/the_great_caspian_arms_race