What happended this year is that the U.S. lost out. And I can't help but ask if that development isn't what lies behind the stepped up U.S. aggression in the Middle East. The triggering event of which was Ariel Sharon's 'visit' to the Aqsa mosque with several thousand soldiers. One thing lead to another and now we have 5000 Palestinian casualties of whom 150 are dead, and 2000 more U.S. military personnel in Yemen, along with 100 more FBI agents, as a result of the Cole explosion. We are that much closer to war, or to military occupation.

So what has happened in the past year?

In February of this year, the U.S. stepped away from Central Asia, considering it too remote and Kazakstan, in particular, too closely aligned with Russia.

In March of this year, Stratfor reported that the U.S. had lost influence over the Caspian Basin oil.

On March 14 of this year, Iran announced that it had signed a deal with a Swiss-Chinese consortium funded partially by a French bank to fund a pipeline in northern Iran.

Russia was no loser in this contest as its exports account for more than 2/3 of the exports of the area.

The Clinton Administration had previously favored a pipeline from Azerbaijan, which it considerd an ally, to Turkey, another ally (the Baku-Ceyhan pipeline) but had failed to obtain funding. Even American oil companies favored the pre-existing pipelines. (See the Washington Post, August 27, 2000, Cheny and the 'Great Game'). With competition from the pre-existing Iranian pipeline from Neka to Rey, and the Russian built one from Tengiz to Novorossiysk, pipelines that connected to existing facilities, the U.S. favored Baku-Ceyhan lost out.

Russia is heavily dependent on and invested in oil and natural gas. Forty-seven (47%) of Russian hard currency revenues come from petroleum exports.

The U.S. Department of State estimates that the Caspian region will be able to produce 3,500.000 bpd (barrels per day) by 2010 and 5,000,000 bpd by 2020, a great deal more than the 500,000 bpd, that the pipelines can handle currently.

The costs of the Iranian Neka-Rey pipeline is projected to be not more than $890 in contrast to the $3 billion pricetag of the Baku-Ceyhan proposal. In addtion, the Iranian pipeline is likely to be able to handle all the projected Caspin Sea Oil.

The Azerbaijan route would have traversed Georgia and Turkey, all U.S. allies, which may account for the American choice of that route.

The Russian Tengiz-Novorossiysk was built by Russia with very little foreign funding and transports oil from Kazakstan.

The Iranian pipeline would have cut out Turkey, which most likely was the reason the State Department did not favor it although Cheny seems to have done so.

Another angle to the story is Central Europe's curent dependence on Russian supplied petroleum. The Ukraine would like to build a pipeline from Odessa on the Black Sea to Brody in order to connect up to the Druzhba pipeline network. The Druzhba feeds Central Europe and is controlled by Russia.

Both the Odessa-Brody and the proposed Borgas-Vlore, which runs from Bulgaria to Albania are a challenge to Russian hegemony. And interestingly, the U.S. has been pro-Ukraine as well as pro Albanian in its support of Kosovars Albanians in Yugoslavia.

The European Union has had talks this month with Russia about doubling its imports of Russian natural gas and oil. If Russia builds a pipeline through Poland to Germany, the Ukraine will lose out but European states will have increased supplies of oil and gas and the Caspian Sea and Central Asian suppliers will be able to reach European customers. This may also explain the European Union's going very soft stance on Russia's war in Chechnya.

In August of this year, U.S. Energy Secretary Bill Richardson took a tour which included Nigeria, Kazakstan and Sakhalin Island in Russia's far East, with estimted reserves of 2 billion barrels of oil and 400 billion cubic meters of natural gas. It would seem he did not get what he wanted.

Today, two months later, the U.S. presence in the Gulf region is that much stronger. Despite their protests and the growing anger of their populations, there is little the Arab governments of the region can do. Any military move against Israel would only result in even higher Palestinain casualties.

Having lost out to Russia and Iran in the grab for Caspian Sea and Central Asian oil deposits, is the U.S. attempting to consolidate its grip on Middle Eastern oil? With the Palestinians held hostage by the Israelis, the 'Arab threat' is effectively held in check, which may provide part of the explanation for Israel's continued intransigence towards the Palestinians.

And why, in this time of increased world-wide demand for oil, is the U.S. still insisting that maintainng sanctions on Iraq? Between sanctions on Iraq and deals with the Saudis the U.S. efffectively controls the two (known) largest reserves of oil on the planet. And in the most troubling news of all, an article in The Guardian reveals that American oil companies buy a third of the Iraqi oil but do so indirectly from other countries.

Sanctions it seems are neither against Saddam Hussein or the Amercian oil companies with whom he does business, but only against the Iraqi people. All is not what it seems. What lies beneath the carefully constructed facade presented to us by our leaders is dark, murky and blacker than the blackest gold.