The Possible Russian Military Base In Egypt And Global Oil Market Redistribution

Written by Leonid Krutakov, originally appeared at histrf.ru, translated by RU Experts.

Aria of the Suez guest. Oil redistribution and the return of Russia in Egypt

Simultaneously with the agreements made in Istanbul between Russia and Turkey, it came public the news about the creation of a Russian naval base in the Syrian port Tartus. And also in the Russian media appeared information about negotiations between Moscow and Cairo regarding the lease of military facilities in Egypt. Primarily, the talks are about the return of the Russian armed forces in the former Soviet air base at Sidi Barrani, abandoned in 1972.

The alignment of the facts and interests

Negotiations seem to have been going on for a long time. Back in February of last year the 9th channel of the Israeli television reported suspicious increase in the intensity of flights of Russian transport aircraft towards the African coast of the Mediterranean Sea. The aircraft made a considerable detour, avoiding the Turkish airspace, changed the call letters and disappeared from radar just near the town of Sidi Barrani.

Our media has just recently found out about the military contacts between Russian and Egypt. This link goes directly to two sources in the Russian Foreign Ministry and one in the Ministry of Defense. It is clear that the time of the leak was not chosen by chance. Taken together the three news outline the oil painting titled “Russia’s return to the big game.”. It is not about some militaristic games, but it’s about the big oil game.

The agreement with Erdogan on the “Turkish Stream” and the Russian military base in Syria slammed two windows from the Middle East to Europe for Washington.

Let me remind you, the civil war in Syria broke out immediately after the signing of a tripartite memorandum between Damascus, Baghdad and Tehran on the construction of a gas pipeline from Iran to the Mediterranean, and Turkey is the only territory (bypassing Russia) for transportation of hydrocarbons from the Caspian region to the EU.

The military base in Egypt, if it’s established, will mark the Russian presence in one of the main transport highways of the world. The base would be insurmountable (and intolerable) challenge for the whole Anglo-Saxon world.

The Suez key

Since the days of the British Empire, Cairo was considered to be the key to the whole Middle East. In the neighboring countries of Egypt all revolutions, coups and the nationalizations of the last 150 years were directly related to oil concessions. In the country of the Pharaohs the main political driver has always been not the concessions, but “the great oil way” – the Suez Canal, the jewel of the British Empire and the foundation of its trade dominance.

Since the opening of the Suez Canal in 1869, its history is surprisingly directly related to Russian oil. More precisely, with the competition for the Asian markets between “Standard Oil” and the Russian oil. At that time, “Standard Oil” controlled the entire world market for kerosene. Even on the Russian market, despite their own rich reserves of oil in Baku, the US share of kerosene was 80%.

The reason for this was the whole previous policy of the British Empire, aimed at isolating Russia, deprivation of its direct access to the world’s trade routes. The Russian kerosene was transported to Europe from Baku on the Volga river to Nizhny Novgorod, and later in St. Petersburg. As a result, freight from New York to Kronstadt costed 25-30 cents per pud and delivery from Baku to Nizhniy Novgorod was 35 cents.

All this despite that just 400 miles from Baku is the Black sea that opens access to the world’s trade routes and the Danube river (Europe’s main transport artery). Russia was deprived of the opportunity to have a port in the South Caucasus. In the Black Sea straits and the mouth of the Danube ruled The Sublime Porte (the Ottoman Empire), the dominant status of which was enshrined with the results of the Crimean War (1853-1856) and the guarantees from France and England.

The Russian solution

With the access to the world oil market the situation has changed dramatically. The mandatory condition for the domination of the British Empire in the world (the blockade of the Russian Empire) has helped “Standard Oil” to establish a global monopoly. England and continental Europe were fully dependent on the American monopolist.

It was at this point when suddenly enlightened Europe started to care about the problems of the oppressed by the Turks Bulgarians. “The humanitarian disaster” in the Balkans forced Britain and France to abandon the guarantees of the outcome of the Crimean War. In favor of the freedom for the orthodox people from the Muslim yoke spoke the best minds of Europe: Charles Darwin, Oscar Wilde, Victor Hugo and Giuseppe Garibaldi.

In 1877 began a new Russian-Turkish war (the liberation war). Britain supported it, but with a condition: The would not had been a big Orthodox state in the Balkans. In the end, only part of Bulgaria received freedom.

And Russia gained control over the mouth of the Danube and the Transcaucasian ports of Batumi. Immediately after the signing of the Russian-Turkish peace treaty began the construction of the Transcaucasian railway (Baku – Batum). The investor was the banking house of Rothschild in exchange for the right to possession of preferential oil fields in Baku.

In 1883 the road was put into operation, and the Russian kerosene exports grew over the next seven years from 25 thousand tons to 620 thousand tons (or 25 times). The monopoly of “Standard Oil” was destroyed in record time. Russian kerosene began to provide 70% of the needs of the European consumers. Most of the supply was carried out by the house of Rothschild.

Just business

After ousting “Standard Oil” from Europe, the clash for the rapidly growing markets of East Asia was only a matter of time. The outcome of this collision was directly dependent on the Suez Canal. The distance from Philadelphia to Singapore by the Cape of Good Hope was 15 thousand miles, and from Batumi through the Suez Canal – 11.5 thousand miles.

In the two years prior to the Russian-Turkish War of Liberation, England forced the ruler of Egypt, Ismail Pasha, to sell his shares of the Suez Canal to London and shared with France the right to manage it. A year before the end of construction of the Baku – Batum road Britain occupied Egypt and took control of the Suez Canal, displacing France.

The purchase of shares of the Suez Canal has financed the English branch of the Rothschild family, and 60% of exports of Russian kerosene controlled the French Rothschilds. All the conditions for a rapid attack on the position of “Standard Oil” in Asia were there.

As a counterparty of Rothschild banking house in the talks with the government of England on the oil traffic through the Suez Canal was chosen the East End merchant Marcus Samuel, who inherited from his father a small company called “Shell”. The company was selling small crafts made of shells, but had a well-established connections in Calcutta, Singapore, Hong Kong, Bangkok, Manila and other parts of Asia.

In 1890 Marcus Samuel arrives in Baku and then he tours Asian countries where he launched the construction of several oil tanks. On his return to England he places an order on the Scottish shipyards to build ocean tankers.

Tankers were still on the docks, England has not issued a permit for the passing of tankers through the Suez Canal, but Samuel has already signed with the Rothschilds nine-year contract (until 1900), according to which he received the exclusive right to sell Russian kerosene east of the Suez.

“Standard Oil” tried to destroy the plans and hired the most famous at that time law firm in London “Russell and Arnholts” which waged a powerful lobbying attack. They used the traditional argument – the “Russian threat”. The lawyers warned the British government that if they allowed today tankers through Suez operated by the British merchants, tomorrow Russian companies will be able to achieve this too. And that the Russian officers and sailors will be able to “block in the sailing in the canal” and “disrupt navigation in it.”

Apparently, lawyers were not aware of the exclusive contract that Marcus Samuel had with the Rothschilds. Did the Foreign Minister of Britain know about it is unknown but he had a principled position: The passing through the canal of the British tankers meets the interests of England. Soon, the Suez Canal Authority has issued that permission.

It was all done with tremendous speed for the British bureaucracy. August 23, 1892 (one year after the signing of the contract with the Rothschilds) Samuel’s first tanker “Murex” passed through the Suez Canal with a cargo of 4,000 tons kerosene from Baku. And next year, Samuel launched 10 more ships. For a long time, the share of Marcus Samuel in the transported through the Suez Canal kerosene did not fall below 90%. And it was a Russian kerosene.

The big oil game broke the Russian attempt to become an independent player with the help of the construction of the Trans-Siberian. The attempt ended with the Russian-Japanese War and the destruction of the Baku oilfields. But the game did not end there.

The reverse of the 20th century

After the Egyptian revolution (1952) and the nationalization of the Suez Canal (1956), Britain with the support of France and Israel tried to regain control of the Suez by using military means. The war was ended by the joint efforts of the USSR and the US, which hoped to establish their control over the canal.

Abdel Nasser made a bet on the USSR, but in 1967 as a result of the Six Day Arab-Israeli war (this time with the support of the United States) the canal was blocked by Israeli troops. Each year, Egypt was losing 4-5 billion dollars (still backed by gold at the time) due to the idle canal.

After the death of Nasser in 1970 and the coming to power of Anwar Sadat, Egypt was forced to change its priorities moving from an ally of the Soviet Union to an ally of the United States. In 1972, Sadat expelled from Egypt all the Soviet specialists and closed the military base in Sidi Barrani. And two years later Israel withdrew its troops and Egypt began restoring the Suez Canal.

Since then, the conjuncture of the oil market changed radically. The US abandoned the gold standard, limited the domestic oil production and turned from an exporter to the main importer of oil. Suez Canal as the main oil route now runs in the opposite (reverse) direction – it serves to supply raw materials to Europe and the United States, and the control of it is a strategic priority for Washington.

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Today, the world has entered the era of a new oil assets redistribution. Previous redistributions have been associated with revolutions of local colonels (Gaddafi, Saddam) in the oil-rich countries with the tacit support of the Soviet Union and the nationalization of the oil-extracting concessions of the United States and Britain. Now there is a reverse process – the “color revolutions” and the return of oil production and transportation under the direct control of the United States.

If the information on the return of Russia to the Sidi Barrani is confirmed, it would mean that the alternative proposal that Russia made to the world oil market in Syria, have been heard not only in China but also in the Arab countries.