Eastern Mediterranean Floating on Oil and Gas Riches

by William Engdahl
Boiling Frogs
March 6, 2012

The discovery in late 2010 of the huge natural gas bonanza off Israel’s Mediterranean shores triggered other neighboring countries to look more closely at their own waters. The results revealed that the entire eastern Mediterranean is swimming in huge untapped oil and gas reserves. That discovery is having enormous political, geopolitical as well as economic consequences. It well may have potential military consequences too.

Preliminary exploration has confirmed similarly impressive reserves of gas and oil in the waters off Greece, Turkey, Cyprus and potentially, Syria.

Greek ‘energy Sirtaki’

Not surprisingly, amid its disastrous financial crisis the Greek government began serious exploration for oil and gas. Since then the country has been in a curious kind of a dance with the IMF and EU governments, a kind of “energy Sirtaki” over who will control and ultimately benefit from the huge resource discoveries there.

In December 2010, as it seemed the Greek crisis might still be resolved without the by-now huge bailouts or privatizations, Greece’s Energy Ministry formed a special group of experts to research the prospects for oil and gas in Greek waters. Greece’s Energean Oil & Gas began increased investment into drilling in the offshore waters after a successful smaller oil discovery in 2009. Major geological surveys were made. Preliminary estimates now are that total offshore oil in Greek waters exceeds 22 billion barrels in the Ionian Sea off western Greece and some 4 billion barrels in the northern Aegean Sea.[1]

The southern Aegean Sea and Cretan Sea are yet to be explored, so the numbers could be significantly higher. An earlier Greek National Council for Energy Policy report stated that “Greece is one of the least explored countries in Europe regarding hydrocarbon (oil and gas-w.e.) potentials.”[2] According to one Greek analyst, Aristotle Vassilakis, “surveys already done that have measured the amount of natural gas estimate it to reach some nine trillion dollars.” [3] Even if only a fraction of that is available, it would transform the finances of Greece and the entire region.

Tulane University oil expert David Hynes told an audience in Athens recently that Greece could potentially solve its entire public debt crisis through development of its new-found gas and oil. He conservatively estimates that exploitation of the reserves already discovered could bring the country more than €302 billion over 25 years. The Greek government instead has just been forced to agree to huge government layoffs, wage cuts and pension cuts to get access to a second EU and IMF loan that will only drive the country deeper into an economic decline. [4]

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The New Global Financial Order Begins in Europe

Banksters agree to force reviews on countries financial operations if  ‘suspect flaws’ arise.

Financial Times

Order out of chaos. The EU takes more power away from nation-states.

Order out of chaos. The EU takes more power away from nation-states.

European Union finance ministers agreed on Tuesday to new intervention powers for EU officials if member states’ economic statistics are suspected to be flawed.

The measure will allow officials from the EU’s statistical agency Eurostat and the European Commission to conduct “methodological visits”, sending in number crunchers to vet countries’ data if this is deemed necessary.

The intervention powers, however, will only come into play in strictly defined circumstances in which concerns have been flagged. Diplomats cite, for example, the situation in which a country revises its figures at short notice and without a clear explanation for this as a possible case for intervention.

Similar powers have been proposed in the past, but failed to secure the backing of EU member states. However, the data flaws that emerged during the Greek crisis and the new emphasis on tougher economic surveillance in the region, coupled with pressure from European parliamentarians, has persuaded countries to accept the potentially intrusive powers.

The new surveillance measure is one of the most concrete actions expected to come out of Tuesday’s meeting of finance ministers from the 27-country bloc in Luxembourg. They will also discuss economic governance – including a new stability programme for Cyprus and additional budgetary consolidation in Spain and Portugal – as well as proposals, driven by the European Commission, to strengthen financial regulation.

Some of these discussions will pave the way for further debate at the EU leaders’ summit in Brussels next week.

“There’s lots of policy debate ahead of the council meeting and those debates are pretty significant, but no meaty items,” said one diplomat.

On Monday night, Herman Van Rompuy, the EU president, who is heading a special “task force” charged with improving economic governance in the bloc, said he believed “rapid progress” could be made on budgetary and macroeconomic surveillance. Proposals in this area would now be the focus of his interim report to EU leaders next week, he said.

Mr Van Rompuy is also thought to be leaning towards the French idea of some form of “economic government” for the eurozone. French president Nicolas Sarkozy has been pushing this idea, which would involve regular summits of eurozone leaders and give the bloc its own secretariat.

On Monday, finance ministers from the 16 eurozone countries also approved details of the “special purpose vehicle” facility, which could raise up to €440bn and make up the key part of their landmark €750bn stabilisation fund for the eurozone’s most vulnerable members.

The facility, based around a “special purpose vehicle”, which will raise money to be lent to countries in financial distress, will be called the European Financial Stability Facility and is expected to become active this month.

It will be backed by pro rata guarantees from individual member states. These will be for 120 per cent of each bond issue, providing a “cushion” should any individual contributor struggle to meet its share.

Countries will only be able to tap the fund when they have agreed programmes to overhaul their economies.

Finance ministers said they would seek “the best possible” credit rating for bonds or debt securities issued by the EFSF. “The message from finance ministers is that they will do whatever it takes to get an AAA rating on the debt issued by the SPV”, said analysts at JPMorgan on Tuesday .

● Estonia will join the euro from the beginning of 2011 after winning the backing of European finance ministers for the move.

Jean-Claude Juncker, the Luxembourg prime minister who heads the so-called Eurogroup, said that Estonia had agreed to “ensure the sustainability of convergence by implementing further structural reforms”. Estonia will be the 17th member of the eurozone.

Israel Commandos Murder 16 people in attack to Aid Ship

Telegraph

Fighting broke out between the activists and the masked Israeli troops, who rappelled on to deck from helicopters before dawn.

A spokeswoman for the flotilla, Greta Berlin, said she had been told ten people had been killed and dozens wounded, accusing Israeli troops of indiscriminately shooting at “unarmed civilians”. But an Israeli radio station said that between 14 and 16 were dead in a continuing operation.

“How could the Israeli military attack civilians like this?” Ms Berlin said. “Do they think that because they can attack Palestinians indiscriminately they can attack anyone?

“We have two other boats. This is not going to stop us.”

But an Israeli military spokeswoman said that there had been a planned and organised attempt to “lynch” the boarding party. She said the activists were armed with knives and guns.

The Israeli government’s handling of the confrontation was under intense international pressure even as it continued. The Israeli ambassador to Turkey, the base of one of the human rights organisation which organised the flotilla, was summoned by the foreign ministry in Anakara, as the Israeli consulate in Istanbul came under attack.

One Israeli minister issued immediate words of regret. “The images are certainly not pleasant. I can only voice regret at all the fatalities,” Binyamin Ben-Eliezer, the trade and industry minister, told army radio.

But he added that the commandoes had been attacked with batons and activists had sought to take their weapons off them.

Israeli military sources said four of its men had been injured, one stabbed, and that they had been shot at.

“The flotilla’s participants were not innocent and used violence against the soldiers. They were waiting for the forces’ arrival,” they were quoted by a news website as saying.

The flotilla had set sail on Sunday from northern, or Turkish, Cyprus. Six boats were led by the Mavi Marmara, which carried 600 activists from around the world, including Mairead Corrigan Maguire, the Northern Ireland peace protester who won a Nobel Prize in 1976.

It came under almost immediate monitoring from Israeli drones and the navy, with two vessels flanking it in international waters. The flotilla, which had been warned that it would not be allowed to reach Gaza, attempted to slow and change course, hoping to prevent a confrontation until daylight, when the Israeli military action could be better filmed.

But in the early hours of this morning local time commandoes boarded from helicopters.

The activists were not carrying guns, but television footage shown by al-Jazeera and Turkish television channels show hand-to-hand fighting, with activists wearing life-jackets striking commandoes with sticks.

The Israeli army said its troops were assaulted with axes and knives.

The television footage did not show firing but shots could be heard in the background. One man was shown lying unconscious on the deck, while another man was helped away.

A woman wearing hijab, the Muslim headscarf, was seen carrying a stretcher covered in blood.

The al-Jazeera broadcast stopped with a voice shouting in Hebrew: “Everyone shut up”.

Israel imposed its blockade on Gaza after the strip was taken over by the militant group Hamas in 2007. It has allowed some food and medical supplies through, but has prevented large-scale rebuilding following the bombardment and invasion of 2008-9.

The flotilla is the latest in a series of attempts by activists to break through the blockade. The boats were carrying food and building supplies.

Activists said at least two of the other boats, one Greek and one Turkish, had been boarded from Israeli naval vessels. Activists said two of the other boats in the flotilla were American-flagged.

The confrontation took place in international waters 80 miles off the Gaza coast.

It was attacked by the head of the Hamas government in Gaza, Ismail Haniyeh.

“We call on the Secretary-General of the U.N., Ban Ki-moon, to shoulder his responsibilities to protect the safety of the solidarity groups who were on board these ships and to secure their way to Gaza,” he said.

Turkish television meanwhile showed hundreds of protesters trying to storm the Israeli consulate in Istanbul. The incident will be particularly damaging for Israel’s relations with what had been seen as its closest ally in the Muslim world.

“By targeting civilians, Israel has once again shown its disregard for human life and peaceful initiatives,” a Turkish foreign ministry statement said. “We strongly condemn these inhumane practices of Israel.

“This deplorable incident, which took place in open seas and constitutes a fragrant breach of international law, may lead to irreparable consequences in our bilateral relations.”

Israel’s closest ally Washington described the loss of life as a “tragedy” on the eve of talks between President Barack Obama and Prime Minister Benjamin Netanyahu.

“The United States deeply regrets the loss of life and injuries sustained and is currently working to understand the circumstances surrounding this tragedy,” a White House spokesman said.

Watch the Video of the Attack here

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