Oil & Gas, Ukraine Orange Revolution and Russia

During the 2004 Ukrainian Presidential Election, an unprecedented event took place. For the first time since 1991, a Ukrainian politician dared opposing the position of Ukraine as a satellite of Russia and showed signs that he wanted “to get rid of Russian grip over his country”, this man is Viktor Yushchenko. The other man participating in the elections was Prime Minister Viktor Yanukovych. Accusing the last of rigging the elections, a political struggle began between the two candidates to the Ukrainian Presidency. During this struggle, a terrible event took place : Yushchenko was poisoned and immediately his partisans blamed Yanukovych. But unusually, while normally behind the Head of The Government Prime Minister Yanukovych, Ukrainian Security Services, who were aware of his doubtful activities and ties in the business world, helped the political opposition led by Yushchenko. Indeed, on November 28 2004, when Prime Minister Yanukovych ordered ten thousand troops of the interior ministry’s security forces to be mobilized in order to prevent the manifestation planned by the political opposition in the capital city Kiev’s Independence Square, the officers of the Ukrainian Security Services warned Yushchenko about the planned mobilization. They justified their act as “prevention of bloodshed”. Moreover, the Ukrainian Security Services commanding officers did not sincerely want Yanukovych to become president and began performing mutiny acts justifying them now that Yushchenko is president, as part of their duty to protect their country and preventing men like Yanukovych from taking power is part of that duty. Of course, normally it wouldn’t be tolerated but the exceptional circumstances under which Ukraine was requested to make personal deductions and taking the adequate actions. So they literally provided the political opposition with evidence (wiretap recordings, classified documents etc.) proving Yanukovych’s obscure ties with some businessmen as well as scandalous documents proving electoral fraud. But if Yanukovych lost even control over his security services, how could have he been able to pursue his election frauds and actions alike it ? Well according to some sources, it is thanks to Russian support that he has been able to stand tight in his position. How does Russia justifies its involvement in the elections of a foreign country ? According to the Russians, Yushchenko was tied with a criminal and sworn enemy of the Kremlin : Russian oligarch Boris Berezovsky. The fact is that Berezovsky financed through fake companies the campaign of Yushchenko although it is forbidden by Ukrainian Law that any foreigner participates in one way or another in “National Political Affairs” which include elections as well. Berezovsky even confirmed meeting with Yushchenko’s representatives in London but made no allegations whatsoever about financial support of the Political Opposition. On the other hand, Yanukovych did the same as he was awarded Kremlin consultants and advisers to help him with his political actions, met several times during the elections with Russian President Vladimir Putin, received support speech in the Russian-State-Controlled Media and was even provided with Russian-State-Controlled businesses financial help. Some even pretend that the Kremlin was the instigator and executor of Yushchenko’s poisoning as Yanukovych could have never done it alone without the support of his Security Services ; but of course those allegations are not proven yet and can be disputed and non taken seriously. Eventhough Putin’s protégé lost the elections, the opposition came to power in Ukraine and Russia lost the country as one of its last zones of influence, the Kremlin did not say his last word. Indeed, following presidential elections in Ukraine, Russian oil companies, mainly Gazprom, suddenly have risen gas prices from fifty dollars per thousand cubic meters to two hundred and thirty ! Alleging even more that if Ukraine does not comply with the newly fixed prices, these oil companies, surely under Kremlin pressure, would close their hydrocarbons delivery through pipelines crossing Ukrainian territory causing as such a huge downfall in the country’s national income.

European Oil Companies and Pre-2003 Iraq

Since Gulf War One in 1991, during which The Arab Republic Of Iraq’s Armed Forces under late President Saddam Hussein’s Command invaded tiny neighbor Kingdom Of Kuwait, Iraq has been victim of a terrible embargo and submitted to an “Oil For Food” program. Although the oil deliveries and imported goods in Iraq should have been strictly and closely watched after by The United Nations, some high regime figures in cooperation with Western, and mainly European, businessmen sold oil outside the frame of the “Oil For Food” program under fake companies or pretended humanitarian organizations. But amongst all oil companies who took advantage of the situation, none did more than French ones. Indeed, France used to be before and after 1991 the closest Western country to the Saddam Regime. For instance, they provided him with a nuclear reactor in the 80’s . After the 2003 Iraq War, discovered and declassified documents showed that French oil companies were extremely closely tied with the Iraqi regime concerning their major oil deliveries destined to their consumers. These ties were born not only from the “traditional” fact that France is a close partner of Saddam but also through corruption of Iraqi Regime VIPs in order to be awarded geographic concessions over the oil-rich Iraqi oilfields such as Majnoon in Southern Iraq or Mosul in Northern Iraq, all this resulted in huge project worth billions of dollars such as Bin Umar Project three point four billion dollars for the development and the exploitation of Majnoon Oilfield. According to The French Justice, the corruption for the awarding of concessions or access to oil reserves was conducted through subsidiaries of the oil companies in “tax heavens” such as Bermuda and the Bahamas and their connections in Switzerland, mainly in Geneva. It is said that between 1996 and 2001, nearly twenty million dollars were transferred through those subsidiaries and Swiss connections to offshore accounts in Tax Heavens in the Caribbean Sea. Other discovered documents showed that US oil companies as well took advantage of the situation making secret deals in order to use excess capacity of French pipelines in Iraq to award themselves as well a bit of the Iraqi oil, and this outside the frame of the “Oil For Food” UN program.