Analysis of the causes of the recent military confrontation on the Armenian-Azerbaijani border reveals an interesting panorama. No such sharp military confrontation or casualties were reported along the border of these two South Caucasus countries during the 30-year-long Nagorno-Karabakh conflict.
Until July 12 this year, the main place of military confrontation between the two countries was Nagorno-Karabakh and 7 adjacent regions, which are recognized by international law as the territory of Azerbaijan and occupied by the Armenian Armed Forces. The last such sharp military confrontation between two countries took place in April 2016 and is engraved in history as a four-day April war.Since then, there has been no such confrontation between Armenia and Azerbaijan with using of heavy artillery and air force.
This time the clash took place in the Tovuz region of Azerbaijan, 300 kilometers from Nagorno-Karabakh.According to the Azerbaijani Defense Ministry, starting from noon on July 12, Armenian Armed Forces violated the ceasefire in the Tovuz region of the Azerbaijani-Armenian border and fired on civilian and military positions using artillery. As a result, 12 Azerbaijani servicemen and 1 civilian were killed. The attack was prevented only after retaliatory strikes, but the ceasefire along the border has not yet been fully restored. The co-chairs of the OSCE Minsk Group (USA, Russia, France) which mediate in the peaceful settlement of the Nagorno-Karabakh conflict, the European Union, as well as the international community call for a ceasefire. However, the possibility of resuming the ceasefire soon is not yet on the horizon.
In this case, one of the main points that raises the question is why the fighting took place not in the direction of Nagorno-Karabakh, but on the Armenian-Azerbaijani border. The point is that the region where is situated the Tovuz region of Azerbaijan, attacked by the Armenian Armed Forces, ihas a strategic importance. The Baku-Tbilisi-Ceyhan pipeline, which carries crude oil to Europe, the South Caucasus Pipeline, which is the beginning point of the Southern Gas Corridor, including the Trans-Adriatic Pipeline (TAP) to Italy, and the Baku-Tbilisi-Kars railway, which laid the foundation for the revitalization of the Silk Road pass from Tovuz region also. The military provocations in Tovuz not only destabilize the region, but also hinder the operation of these important projects, which provide access to alternative energy sources for Europe.
Elshad Nasirov, Vice President for Investments and Marketing of the State Oil Company of Azerbaijan (SOCAR), also voices interesting views on this issue: “In my opinion, it is not accidental that Armenia launched a military operation against Azerbaijan three months before the start of Azerbaijani gas supplies to Europe. Military operations are realised on the Armenian-Azerbaijani border, not in Nagorno-Karabakh, which is recognized by all international organizations and countries as the territory of Azerbaijan. All the infrastructure that brings Azerbaijan’s energy resources to Western countries and the world market is located in this region. Baku-Tbilisi-Ceyhan, Southern Gas Corridor, Baku-Supsa pipeline, Baku-Tbilisi-Kars railway, Baku-Tbilisi highway pass through the direct view and proximity of the place where the Armenian military operations began. I invite our colleagues from Washington, Europe and elsewhere to think about how sensitive the Ganja Corridor and the Trans-Caspian region are and how to ensure the military and physical security of Europe’s energy security corridor”.
At present, European countries are among the main consumers of Azerbaijani oil. Italy is Azerbaijan’s main trading partner in the sale of this oil on world markets. In the autumn of this year, Europe will also start consuming Azerbaijani gas. For this purpose, a 3,500-kilometer-long Southern Gas Corridor pipeline is being built and is nearing completion. Its last ring, the Trans-Adriatic Pipeline to the Italian shores of the Adriatic Sea, is 97 percent completed. TAP is the European section of the Southern Gas Corridor, enhancing Europe’s energy security and contributing to decarbonisation and the diversification of gas supplies.
In October 2020, the pipeline will start transporting Azerbaijani gas to Europe. Thus, Europe will start importing natural gas from a completely new source. The attack on Azerbaijan’s Tovuz region shortly before this important event is also considered an attack on Europe’s energy security. Azerbaijan believes that one of the main goals of Armenia’s latest provocations is to destabilize the region and hinder the operating of these important projects, which will allow Europe to access alternative energy sources and new markets.
There is another dangerous reason for Armenia’s bombing of the border areas densely populated by the Azerbaijani population. The another aim of the provocation and tension in the direction of Tovuz region of the state border between the two countries is to involve third parties to the conflict.We are talking about Russia and member countries of the Collective Security Treaty Organization (CSTO). Azerbaijan’s Ambassador to Russia Polad Bulbuloglu says in this regard: “There is no doubt, this was done to involve the CSTO member countries and, first of all, Russia into the conflict. Because it’s clear that Azerbaijan has bilateral partnership relations, including economic ones with all members of the CSTO. The local task is to raise the CSTO, primarily Russia, the global task is to create another hotbed of tension along the perimeter of Russia, which would create certain concerns”.
Assistant to Azerbaijan’s President, Head of Foreign Policy Affairs Department of the Presidential Administration Hikmat Hajiyev agrees üith this opinion. He says Armenia seeks to involve military-political organizations, member of which it is, into the Karabakh conflict, through military provocations, and avoid responsibility for occupation and aggression against Azerbaijan.
However, Armenia’s efforts in this direction did not yield results.Even though Head Secretary of the organization initially said it would hold an emergency meeting on the issue, but later postponed it indefinitely period.However, Armenia still does not give up its attempts to involve Russia and the organization in the conflict. In this case, Turkey the member of NATO openly supports Azerbaijan. In this context Armenia is trying to confront NATO and Russia in the Caucasus by exaggerating the Turkish factor. But this time, Russia is cautious.
Nevertheless, it is important to resolve the Nagorno-Karabakh conflict as soon as possible within the framework of international law in order to prevent the dangerous development of events. It should be reminded that, four resolutions of the UN Security Council demanding unconditional withdrawal of the Armenian troops from the occupied territories.Armenia in 1990 years aggressively occupied the Nagorno-Karabakh region and the adjacent seven districts of Azerbaijan. The conflict between the two South Caucasus countries began in 1988 when Armenia made territorial claims against Azerbaijan and as a result of the ensuing war, Armenian armed forces occupied 20 percent of Azerbaijan. Over a million Azerbaijanis living in these territories were subjected to ethnic cleansing and were expelled from their homes.The 1994 ceasefire agreement was followed by peace negotiations. But Aprel war in 2016 and border clash in July of this year shows the conflict may ignite in any time on military ground.
U.S. Government Likely Perpetrated Biggest-Ever Catastrophic Global-Warming Event
On September 28th, the AP headlined “Record methane leak flows from damaged Baltic Sea pipelines” and reported that “Methane leaking from the damaged Nord Stream pipelines is likely to be the biggest burst of the potent greenhouse gas on record, by far. … Andrew Baxter, a chemical engineer who formerly worked in the offshore oil and gas industry, and is now at the environmental group EDF … said, ‘It’s catastrophic for the climate.’” The article pointed out that methane “is 82.5 times more potent than carbon dioxide at absorbing the sun’s heat and warming the Earth.”
Russian President Vladimir Putin had been aiming ultimately (and maybe soon) to get the gas to Europe flowing again, and said to EU nations on September 16th, “Just lift the sanctions on Nord Stream 2, which is 55 billion cubic metres of gas per year, just push the button and everything will get going.”
Here is what U.S. President Joe Biden had already promised about that on February 7th:
If Germany — if Russia invades — that means tanks or troops crossing the — the border of Ukraine again — then there will be — we — there will be no longer a Nord Stream 2. We will bring an end to it.
Q But how will you — how will you do that exactly, since the project and control of the project is within Germany’s control?
PRESIDENT BIDEN: We will — I promise you, we’ll be able to do it.
He had promised to cause permanently the end of Nord Stream if Russia invaded, which it did on February 24th. He fulfilled on that promise on September 27th.
Radek Sikorsky, who is a Member of the European Parliament and had been Poland’s Foreign Minister and is the husband of the famous writer against Russia Anne Applebaum, and has been affiliated with Oxford Universisty, Harvard University, and NATO, tweeted on the day of the explosions, “Thank you, USA.” He also tweeted explanations: “All Ukrainian and Baltic sea states have opposed Nordstream’s construction for 20 years. Now $20 billion of scrap metal lies at the bottom of the sea, another cost to Russia of its criminal decision to invade Ukraine.” And: “Nordstream’s only logic was for Putin to be able to blackmail or wage war on Eastern Europe with impunity.”
Furthermore on September 27th, Germany’s Spiegel magazine reported that, as Reuters put it, “The U.S. Central Intelligence Agency (CIA) had weeks ago warned Germany about possible attacks on gas pipelines in the Baltic Sea”
On September 28th, SouthFront headlined “No Way Back for Europe” and reported:
It is reasonably suspected that the pipeline was blown up by the special services of the United States in order to finally stop the gas supplies to Germany from Russia.
On September 27, a detachment of warships led by the US amphibious assault ship USS Kearsarge reported on the completion of their tasks in the area of the alleged sabotage in the Baltic Sea and headed for the North Sea.
Since the beginning of September, suspicious activity by anti-submarine helicopters of the US Navy has been observed in the area. In the last few days, reconnaissance activities of NATO aircraft have significantly intensified in the Baltic Sea area. In particular, a US Boeing E-3 Sentry reconnaissance aircraft was on constant patrol over the Baltic States, and a US Joint STARS was spotted over Germany and Poland.
Solar Mini Grids Could Power Half a Billion People by 2030 – if Action is Taken Now
Solar mini grids can provide high-quality uninterrupted electricity to nearly half a billion people in unpowered or underserved communities and be a least-cost solution to close the energy access gap by 2030. But to realize the full potential of solar mini grids, governments and industry must work together to systemically identify mini grid opportunities, continue to drive costs down, and overcome barriers to financing, says a new World Bank report.
Around 733 million people – mostly in Sub-Saharan Africa – still lack access to electricity. The pace of electrification has slowed down in recent years, due to the difficulties in reaching the remotest and most vulnerable populations, as well as the devastating effects of the COVID 19 pandemic. At the current rate of progress, 670 million people will remain without electricity by 2030.
“Now more than ever, solar mini grids are a core solution for closing the energy access gap,” said Riccardo Puliti, Infrastructure Vice President at the World Bank. “The World Bank has been scaling up its support to mini grids as part of helping countries develop comprehensive electrification programs. With $1.4 billion across 30 countries, our commitments to mini grids represent about one-quarter of total investment in mini grids by the public and private sector in our client countries. To realize mini grids’ full potential to connect half a billion people by 2030, several actions are needed, such as incorporating mini grids into national electrification plans and devising financing solutions adapted to mini grid projects’ risk profiles.”
The deployment of solar mini grids has seen an important acceleration, from around 50 per country per year in 2018 to more than 150 per country per year today, particularly in countries with the lowest rates of access to electricity. This is the result of falling costs of key components, the introduction of new digital solutions, a large and expanding cohort of highly capable mini grid developers, and growing economies of scale.
Solar mini grids have become the least-cost way to bring high-quality 24/7 electricity to towns and cities off the grid or experiencing regular power cuts. The cost of electricity generated by solar mini grids has gone down from $0.55/kWh in 2018 to $0.38/kWh today. Modern solar mini grids now provide enough electricity for life-changing electric appliances, such as refrigerators, welders, milling machines or e-vehicles. Mini grid operators can manage their systems remotely, and paidsmart meters enable customers to pay as they use the electricity. Connecting 490 million people to solar mini grids would avoid 1.2 billion tonnes of CO2 emissions.
Further acceleration is needed, however, to meet Sustainable Development Goal 7 (SDG7). Powering 490 million people by 2030 will require the construction of more than 217,000 mini grids at a cumulative cost of $127 billion. At current pace, only 44,800 new mini grids serving 80 million people will be built by 2030 at a total investment cost of $37 billion.
Produced by the World Bank’s Energy Sector Management Assistance Program (ESMAP), the new book, Mini Grids for Half a Billion people: Market Outlook and Handbook for Decision Makers, identifies five market drivers to set the mini grid sector on a trajectory to achieve full market potential and universal electrification:
- Reducing the cost of electricity from solar hybrid mini grids to $0.20/kWh by 2030, which would put life-changing power in the hands of half a billion people for just $10 per month
- Increasing the pace of deployment to 2,000 mini grids per country per year, by building portfolios of modern mini grids instead of one-off projects
- Providing superior-quality service to customers and communities by providing reliable electricity for 3 million income-generating appliances and machines and 200,000 schools and clinics
- Leveraging development partner funding and government investment to “crowd in” private-sector finance, raising $127 billion in cumulative investment from all sources for mini grids by 2030.
- Establishing enabling mini grid business environments in key access-deficit countries through light-handed and adaptive regulations, supportive policies, and reductions in bureaucratic red tape.
The handbook is the World Bank’s most comprehensive and authoritative publication on mini grids to date.
Price Cap on Russian Oil: The Mechanism and Its Consequences
G7 countries are working hard to coordinate a sanctions regime to cap prices on Russian oil and oil products. The United States is already drafting a mechanism for applying these sanctions, which its allies and partners will use as a guideline. The new sanctions in the form of legal arrangements are expected to be formalised very soon. How will this mechanism work, and what consequences can this lead to?
An unprecedented range of economic sanctions has been used against Russia since the beginning of the special military operation in Ukraine in February 2022. Their primary aim was to deal the largest possible economic damage to force Moscow to revise its policy and to undermine its resources provision. Since energy exports are extremely important for funding the Russian economy, sanctions against its oil and gas sector were more than just predictable. However, the United States, the EU and other initiators had to act cautiously, because Russia is a major player on the global market. US restrictions on the export of Iranian oil had little impact on the global market, whereas blocking sanctions against Russian oil companies could lead to uncontrollable price hikes. This could accelerate inflation, which was growing fast on the back of COVID-19 and other factors.
Nevertheless, the sanctions noose on the oil sector was tightening. Some sectoral sanctions have been applied since 2014, such as restrictions on loans and on the supply of products, services, technologies and investment in the Arctic shelf oil projects. Blocking sanctions were adopted against a number of co-owners, owners and top managers in the fuel and energy sector. In March 2022, Washington prohibited the import of Russian energy resources to the United States. Canada acted likewise. The EU started with banning Russian coal imports and later spread the ban, with a few exceptions, to oil and oil products. The bans are to come into force on December 5, 2022, and February 5, 2023, respectively. The UK plans to stop the import of Russian oil this year. Overall, Western countries are working to gradually banish Russian oil and oil products from their markets.
However, Moscow has quickly redirected its deliveries to Asian markets, where Western countries cannot easily impose similar restrictions, especially since Russian companies are selling their products with large discounts. The idea of a price cap has been proposed to be able to influence Russian oil prices outside Western countries.
The essence of the proposed mechanism is very simple. The United States, G7 and any other countries that join the coalition will legally prohibit the provision of services which enable maritime transportation of Russian-origin crude oil and petroleum products that are purchased above the price cap. The US Treasury has issued a Preliminary Guidance to explain the essence of the forthcoming bans, to be formalised in a determination pursuant to Executive Order 14071 of April 6, 2022. Section 1 (ii) of the executive order empowers the US Treasury and the Department of State to prohibit the export or re-export of “any category of services” to Russia. The upcoming Determination will explain the ban for American parties to provide services which enable the transportation of Russian-origin crude oil and petroleum products above the price cap. The US administration plans to enforce the ban on oil on December 5, 2022, and the ban on oil products on February 5, 2023, simultaneously with the EU bans on Russian oil imports.
But what is the exact meaning of the phrase “services which enable maritime transportation”? The US will most likely offer an extended interpretation. In other words, such services will include transportation, related financial transactions, insurance, bunkering, port maintenance and the like. This would allow Washington to influence a broad range of service providers outside the United States. For example, the US administration might consider dollar-denominated transactions on oil transportation to fall under US jurisdiction, so that very many players outside the US will face fines or prosecution. Punishment for avoiding the price cap, as well as for using deceptive shipping practices, have been set out in the new Guidance.
It is another matter how strictly the other coalition countries will implement this guidance and how large this coalition can be. The level of coordination within the initiator countries will likely remain very high, which means that the allied countries will do this in accordance with their national legislations. The coalition will include the countries that have already adopted sanctions against Russia.
The biggest question is whether the countries that have not adopted such sanctions, including Russia-friendly countries, can be convinced to join the coalition. The answer is most probably negative, but this will not settle the problem. Despite the official position of the friendly countries, their businesses could surrender to the US demand to avoid the risk of persecution.
The G7 statement and the new Guidance of the US Treasury imply that the sanctions are being imposed out of concern for the international community rather than solely for the purpose of punishing Russia. They say that the price cap is designed to stop the growth of oil prices that have been artificially inflated by the conflict in Ukraine. However, this “concern” can lead to unpredictable consequences.
To begin with, the latest attempt at the political mandating of prices will increase uncertainty, which will further drive the prices up. Prices can grow on expectations of problems with signing deals on the delivery of Russian oil and oil products over excessive compliance, which will lead to temporary shortages. Another problem is that the other oil producers will have to lower prices as well. They will not like this.
In fact, the sellers’ market is being changed into the buyers’ market by artificial political methods rather than for economic reasons.
And lastly, Russia is being forced to become the leader of dumping. Demand for its oil could be higher than for the products of other suppliers, and Moscow can make up for its profit shortfall by increasing deliveries. If the Western countries that prohibit the import of Russian oil and oil products buy other suppliers’ oil at higher prices while Asian countries continue to buy Russian products, this will artificially increase the competitiveness of Asian economies.
It is time for Russia to start thinking about adjusting to the Western restrictions, including by developing its own tanker fleet and abandoning the US dollar in oil deals. The latter is the prevalent task of Russia’s foreign trade in the new political conditions.
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