Ongoing Mideast violence serves Russian oil interests

7/30/2006

Hundreds of people were killed in the Middle East in the last few weeks in the latest flaring of hostilities between Hezbollah and Israel.

Moreover, there is a threat that the conflict spreads across the region.

Pundits are lamenting the United States' inability to directly influence the events diplomatically.

Aware of this fact, Russia, which has been supplying weapons to the Arab countries of the region for decades, is stepping up to the plate, promoting itself as a potential peace broker.

Russia even went as far as asking Syria not to use Russian missiles to retaliate if attacked by Israel.

President Vladimir Putin is taking an active part in portraying Russia as a nation seeking an end to hostilities.

At an official function in the Kremlin last week, he referred to Syria as a leading country of the Arab world and noted Russian-Syrian relations go back a long way.

But the last thing the United States wants is Russia meddling in the region. That's because Russia - a major oil exporter with an outdated oil industry infrastructure - is not interested in Middle East peace.

Fighting in the Middle East, be it in Lebanon or in Iraq, pushes up the price of crude oil, which reached $75 per barrel last week, sending prices at the pump to $3.09 a gallon in Toledo.

As long as that's the case, the Putin regime, which largely has monopolized energy production in Russia, enjoys the windfall of oil dollars.

With oil prices growing, Russia doesn't have to reinvest its oil profits in an industry that badly needs reinvestment to keep production rates at the present level. So long as there is fighting in the Middle East, the Putin regime can afford doing what it pleases, without much regard to ruining the investment climate in Russia.

Doing what it pleases includes taking over the most profitable oil companies, muzzling the media, and reshuffling the government to keep control over its competing factions.

Moreover, the increasing oil prices guarantee a status quo that the Putin regime needs to stay in power beyond 2008 when his last constitutionally permitted presidential term expires.

As long as the oil-dollar windfall guarantees the growth of living standards, Russians will not mind if Mr. Putin bends the rules to stay in power some way or other.

To make sure this is the case, the Kremlin propaganda machine is using the Russian television apparatus it fully controls to promote Russia as an "energy superpower" and a "sovereign democracy."

"Energy superpower" means that Russia, as a major energy exporter, can afford to throw its weight around to defend its ill-conceived self interest abroad, particularly in strategically important regions such as the Middle East.

"Sovereign democracy" is an essentially meaningless term designed to instill in the Russian psyche the idea that Russia has a unique path to follow, with universal democratic values inapplicable there.

So whatever pleasant things Russia may be saying in regard to the Middle East crisis, make no mistake about it - Russia has ulterior motives.

The bottom line is that the United States should not take Russia's words at face value and would do well to discount them altogether.