ABSTRACT

This chapter reviews obstacle to developing the area's energy resources, and the related potential for conflict. It then, assesses how the struggle for control of these resources, among the state of the area and interested outside powers, especially Russia, the United States, Turkey, Iran, and China, affect subregional cooperation. The value of the oil and natural gas resources of the Newly Independent States (NIS) in the Caspian Basin might exceed the current annual GDP of the Caspian and south Caucasian NIS by thirty-five times. Russia is the former dominating power of the Soviet empire, from which the NIS want to gain greater independence. The neglect of the Caspian energy region by Soviet economic planners has particularly affected the crumbling transport system. The contract on the transport of the 'early oil' from Azerbaijan called for construction of a Baku-Supsa pipeline.