The energy issue continues to be an area of conflict, both in terms of wealth and politics, in the Middle East and Caspian region, with the Eastern Mediterranean being recently added. President Recep Tayyip Erdoğan has said recently that Turkey, from now on, can carry out seismic exploration with its own vessels in the Eastern Mediterranean and that it will not take a step back from this. Today, the problem with energy sharing in Caucasia, the Middle East and the Eastern Mediterranean is becoming a question of politics rather than economy, as new energy lines mean new borders and new market networks.
At present, oil and natural gas pipelines can be visualized as a chess game among the EU, Turkey and Russia. The U.S. is closely monitoring this energy game, as the creation of new energy lines outside Russia's initiative and the exclusion of Iran from this game are important signs and steps for the U.S. For example, the realization of the Trans Anatolian Natural Gas Pipeline (TANAP) project by Azerbaijan and Turkey is not an energy move alone, but it also reveals political change and a step taken toward the integration of a vast geography that spans from the Caspian region to Austria. It also marks the beginning of the EU's expansion to the east. This beginning means the emergence of new hubs of energy supply in the Caspian region and Middle East, apart from Russia and Iran; however, it is also a development that will disturb the traditional alliance between Germany and Russia in the EU. Especially after the annexation of Crimea, Russia understand that the U.S. and the U.K will steer the EU toward the Southern Gas Corridor (SGC) for energy. Furthermore, Russian President Vladimir Putin announced during his recent visit to Turkey that they would scrap the South Stream pipeline project and would take it to Europe through Anatolia. As stated above, this move from Russia will terminate the energy cooperation between Germany and Russia, and make Russia a part of the SGC. The SGC will go beyond becoming a project of Azerbaijan and Turkey alone; it will also be realized as a project of Caucasia, Anatolia and Europe, marking a new economic and political situation. Furthermore, the diversification of the SGC in such a way will create a new energy market and pricing in the whole world, as we foresaw well in advance. Since 2011, Russia's natural gas extractor Gazprom has been taking steps toward competitive pricing rather than monopoly pricing. In an article published on Caspian Strategy Institute's magazine called Caspian Forum, Energy Security Specialist John Roberts says, "...And this is where the Southern Gas Corridor really does come to the fore. Russia may have plenty of gas, in terms of both reserves and actual production, but both its ability and willingness to increase its levels to actual supply to the European Union can be questioned. Immediate supplies are impacted by Gazprom's continued belief in the proposition, so clearly enunciated by Vice President Alexander Medvedev in 2011, that "the oil linkage provides the best balance buyers of natural gas. At a time when hub pricing is becoming ever more prominent in European gas deals. What this means is that Gazprom considers the retention of the link to oil prices - which in current terms means higher prices than those offered by its competitors - to be more important than the pursuit of specific export volumes."
As John Roberts suggests, Gazprom's price adjustment is not a state of balance in terms of economy and markets, but, it is also a state of balance in terms of politics and a sign of normalization in politics. I would like to underscore that the increase of actors in energy markets, the diversification of supply and the escalation of price competition all speak of the free market economy, which is something good and a preferable situation for consumers. This also points to further democracy and stability in the Middle East and Caspian region. It should not be forgotten that democracy does not only mean politicians come to power with elections, it also means less monopoly, less intervention in markets by nation-states and the use of natural resources for the benefit of humanity. From this standpoint, it also indicates the end of the old energy game, of which the leading actors are Germany and Russia, with Iran the understudy in the entirety of this territory, as well as a new journey from war to peace for the region. What is needed is a political will that will make this journey real and support it to the end. Today, the TANAP has become the SGC's most important project. The inclusion of Russia and Iran in this pipeline means the process of new peace and integration in the region. Therefore, Turkey, as Erdoğan said, is continuing to explore energy in the Eastern Mediterranean and striving to commercialize the resources of the Caspian region, Mosul and Kirkuk. Apart from this, Turkey is establishing a new energy exchange that will price this energy market. This energy exchange, in the near future, will determine oil and natural gas prices with a free competitive approach, rather than monopolistic and speculative motives.
The energy lines and commercial transits that pass through Azerbaijan, Georgia and Turkey as well as Azerbaijani gas and Kurdish oil, which reaches directly to European markets apart from Turkey, is not only an energy move alone, it is also an important step for Europe's expansion toward its east. For Turkey, these projects are not only energy projects, but projects of peace, democracy and integration as well.