October 31, 2011

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TSG Atmospheric: Talking Turkey, Tehran and Threats

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Overview

The last two weeks have seen a number of momentous occasions: the release of Israeli soldier Gilad Shalit in a prisoner exchange with the Palestinians and brokered by the Egyptians; the declaration by President Obama that the US Forces will fully withdraw from Iraq by the end of 2011; the worst violence and associated death-toll in Egypt since the February Revolution; and in Libya the capture and death of Mu'ammar Qaddafi and his son Mutassim.

However, there is a new tension emerging from the Eastern Mediterranean that has the prospect of complicating international relations, and it appears at first glance to center on hydrocarbon reserves, in this case gas rather than oil.

However, it also links through a series of relationships to the U.S.'s ability to gather strategic intelligence as well as project diplomatic capability, protect U.S. international political and commercial interests, as well as those of its closest allies.

The key players in the dispute are the traditional sparring partners of Turkey, Greece and Cyprus, and also Lebanon, Israel and the U.S.  What appears to be at stake is control of the huge untapped gas reserves under the Mediterranean Sea, but in disputed territorial waters - specifically disputed between Cyprus and Turkey.

However, there is a deeper regional political undercurrent in play, and it hinges upon the strangely  interlinked issues of Turkish strategic influence and political and economic dominance, which in turn connects to the need for the U.S. to be able to collect strategic intelligence on countries of particular security concern as well as maintain its regional military footprint.

To walk down the links of this analysis we first need to take a quick look at a small, hitherto unremarkable island, a little over half the size of Connecticut - not well-known to the majority of the U.S. - the island of Cyprus.

Geo-Political Background to Cyprus

By way of background, Cyprus has been a divided island since 1974, when the Turkish Army invaded to protect the Turkish-Cypriots from a Greek-Cypriot inspired coup against the-then President Makarios.  Turkish-Cypriots feared the new Greek-backed leader, Nicos Sampson, would seek unification with Greece against their wishes. When talks between the two sides broke down, Turkey invaded northern Cyprus to protect the Turkish-Cypriots.

Cyprus was divided in two, the Greek-Cypriots fled to the south and the Turkish community to the north.  Cyprus remains to this day a divided island with a UN force - UNFICYP - keeping the peace.  UN mediated talks have been underway since 1974 to discuss reunification, which has proved to be an enduringly problematic issue. However, until the geo-political storm erupted over the gas fields, some progress was being made, albeit slowly.

And caught at the heart of the geo-political stormclouds is a U.S. company: Noble Energy.  Founded by Lloyd Noble (left) in 1932, Noble Energy is an S&P 500 company with reserves of 1.1 billion barrels of oil equivalent and assets totaling over $13 billion at year-end 2010.   In the last few months Noble Energy has been sandwiched between a Turkish rock and an Eastern Mediterranean hard place; specifically the Turkish and Israeli navies, both of which deployed warships to the region over a dispute over unexplored hydrocarbon resources.

The U.S. Angle

The U.S. has a deep, vested interest in this apparently localized incident.  As a result of the withdrawal from Iraq announced by President Obama on October 21 2011, the U.S. badly needs Turkey as a reliable geo-political partner.

Turkey is needed to help counter the concerns over growing Iranian influence in the region in general, and Iraq in particular.  Further it is needed as a base to relocate the various U.S. intelligence, surveillance and reconnaissance sensors currently located in Iraq to gather the information they need to feed the maw of the intelligence and security agencies of the U.S.

However, the tension between Turkey and Israel following the death of nine Turkish activists in a contentious raid by the Israeli military on a flotilla that sought to break the Gaza blockade, has left the Turkish-American relationship badly damaged, as a result of U.S. support to Tel Aviv over the incident.  The Turkish-Israeli relationship - formerly warm, and which gave Israel a way of politically interfacing to the Muslim nations through Turkey - has become bitter and glacial.

Turkey is also using the dispute over the gas fields as a way of trying to forward its traditional military and political dominance in an increasingly volatile and fractious region.

Unfortunately this - in places - runs counter to U.S. strategic interests, and - just to complicate matters further - in places it meshes exactly with them.

This analysis examines the importance of the Eastern Mediterranean dispute to U.S. strategic political and military policy objectives through the lens of an otherwise apparently localized dispute, but one whose tentacles stretch across Anatolia into Baghdad, Tehran and ultimately, Washington.

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This is an excerpt from the full report released to clients.

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