mercoledì, settembre 10, 2008

Venezuela Plays The Russia Card - Investor's Business Daily via Babalu

Chavez and Putin, sitting in a tree...

A great editorial in Investor's Business Daily: "Venezuela Plays The Russia Card":

On Monday, Russia accepted Chavez's invitation for a first-ever joint naval exercise with Venezuela. In its first major maneuvers off U.S. waters since the Cold War, Russia will send a heavily armed nuclear cruiser to the Caribbean.

Just how critical the Caribbean and Gulf of Mexico are to U.S. interests isn't widely recognized. But in the years since Congress barred offshore drilling in all but the Gulf, U.S. vulnerability has increased. Hurricanes have brought this reality more into focus, but America's enemies are taking notice too. Venezuela's invitation to Russia is just the start.

What is well-known is how dependent we are on foreign oil. During the Arab embargo of 1973, we imported about 25% of our crude. Since 1990, when Congress imposed a moratorium on new drilling, that's grown to 58%. Most of this oil is transported by sea.

We are therefore more dependent than ever on regional access routes. About 64% of U.S. energy imports must pass through the Caribbean to reach ports and refineries of the Gulf Coast, Energy Department data show. It's not just shipments from Venezuela, which account for 10% of U.S. oil imports, but energy from almost everywhere else too.

Nine out of every 14 barrels of U.S. imported oil — from suppliers including Angola, Nigeria, Saudi Arabia, Chad, Russia, Kuwait and Ecuador — must pass through at least one of four principal sea passages in the Caribbean to reach U.S. refineries.

Huge tankers bring about 14 million barrels of oil a week to the Gulf through the Windward Passage between Cuba and Hispaniola, the Mona Passage between Hispaniola and Puerto Rico, the Florida Straits north of Cuba, and the Yucatan Channel between Cuba and Mexico. There is no other way to get these tankers to the U.S. except through these narrow but safe sea lines of communication because the Caribbean can be treacherous for large ships.

Independent of the Gulf destination, nearly 2,000 tankers crossed the Panama Canal in 2007, or 16.9% of its traffic, Panama Canal Authority data show. Most went to U.S. ports. These tankers ship oil from places such as Saudi Arabia to refineries in places such as Long Beach, Calif., making the canal a critical — and vulnerable — choke point.

Even some of Alaska's oil has been known to cross the Panama Canal through the Caribbean on its way to the East Coast. Going both ways, 31 million long tons of petroleum and products were transported to the U.S. in 2007. With the widening of the canal by 2014, more traffic still is expected to pass.

It should also be noted that the U.S. has grown more dependent on regional sources of oil. As of May, 28% of our imports came from Latin American and Caribbean nations that use Caribbean passages more than other exporters. Add Canada, which ships some of its oil through Panama to the Gulf, and it's 47%.

These factors smell of vulnerability, and predators have caught the scent. Enter Chavez, who has watched Russia effectively take control of 25% of Europe's energy supply with its attack on Georgia. The Russians didn't need to blow up the pipeline to get control of it by cowing Europe; they only needed to get close enough.

This lesson wasn't lost on the Venezuelan ruler, who's been trying to lure Russia into a new Caribbean alliance. Chavez visited Moscow in July and reportedly agreed to add another $2 billion worth of advanced weapons to the $4.5 billion he has already purchased.

Not much is known about what Hugo purchased, but he has spoken of acquiring four or five Russian submarines — ideal instruments for disrupting sea lanes. During Russia's invasion of Georgia, Chavez offered Moscow land bases.

He's also succeeded in getting the Russian navy to conduct exercises with Venezuela rather than just make a port visit.

The Russians have little respect for Chavez, but their anger over the U.S. missile shield treaty with Poland and the U.S. Navy's relief mission to Georgia coincide their interests with his.

This threat to sea lanes will increase the burden on U.S. forces who must monitor the new activity. It also underscores how important it is for Congress to permit new drilling for reasons of national security. If Russia can gain control of 25% of Europe's oil just by menacing Georgia, it could get an even more impressive return in the Caribbean.

Posted by George Moneo at September 9, 2008 06:46 PM