Guest Column: Invite the Guantanamo Uygurs Into the U.S.

In Washington, there is much huffing and puffing over whether the presence of Guantanamo detainees on U.S. soil -- whether in prison or free to roam -- represents a national security threat. The best illumination is usually found on the margins, which in this case is represented by the 17 Uyghurs -- long ago absolved of any link to terrorism -- who remain imprisoned at Guantanamo. When I lived in Central Asia, the best expert on anything having to do with the Uyghurs was Sean Roberts, a fellow Almaty resident and Ph.D student who was immersed in these inhabitants of neighboring Xinjiang province. I asked Sean to write a guest column with his own opinion on the Guantanamo Uyghurs. His reply follows.

By Sean Roberts

In the last two weeks, the issue of the 17 Uyghur men who have been in U.S. custody in Guantanamo Bay for the last seven years has come to the forefront of American politics. As somebody who has been studying the Uyghur people for almost 20 years, I am happy to see U.S. congressmen finally discussing Uyghurs and the complexity of their political predicaments. But I have also found the present debate disheartening in many ways. I support releasing all of the Guantanamo Uyghurs into the U.S. But I also believe that there needs to be a wholesale re-evaluation of the goals and tactics of the war on terror that brought them to Guantanamo in the first place.

According to Newsweek, the sudden interest in the Guantanamo Uyghurs began in April, when President Obama considered quietly releasing up to seven of them into the United States, presumably to be settled in northern Virginia. Several congressmen, led by Virginia’s Frank Wolf, sought to block the release. With the issue still unresolved, congressmen from both major parties have begun debating whether Uyghurs are in fact a threat to the United States, and whether these particular men are dangerous terrorists.

As one might expect, the loudest voices in this debate belong to those who oppose the settlement of the Uyghurs in the United States. Newt Gingrich, perpetually in search of a soapbox, suggested in a recent newspaper column that they could suddenly turn against us.

Particularly discouraging is how little U.S. politicians actually know about the Uyghurs despite it being seven years since we essentially identified them as enemies in the war on terror. Before I make the case why they should be released into the U.S., here is some background on how these Uyghurs came to be detained by the U.S. and what has happened to them since.

In June 2002, the U.S. military transported 22 Uyghurs from detention in Pakistan to Guantanamo. These men, who appear to be Uyghur nationalists opposed to Chinese rule in their homeland (referred to as Eastern Turkestan by most Uyghurs and Xinjiang by the Chinese state), had fled China, primarily to Central Asia, eventually seeking refuge in Afghanistan on their way through Iran to Turkey.

In Afghanistan, they presumably interacted with other Uyghur nationalists, and some allegedly underwent minimal military training by a Uyghur group referred to as the Eastern Turkestan Islamic Movement (ETIM).

During the initial U.S. bombing campaign in Afghanistan, these Uyghurs apparently fled to Pakistan and sought refuge with villagers who eventually gave them over to the U.S. military as alleged terrorists in exchange for a bounty (reportedly $5,000 each). According to declassified U.S. government documents (see the PDFs at the end of this page), the original accusations were based on their alleged relationship with ETIM.

All the men denied knowledge of the little-known ETIM, whose 2002 designation by the U.S. as a terrorist group with links to Al-Qaeda was regarded by skeptics as a politically motivated effort to win China’s support for larger U.S. goals in the war on terror.

Since 2002, a series of reviews of the Uygurs’ cases has led to the clearing of all of any charges. But the U.S. government has also recognized that if they are extradited to China, they would inevitably be held or executed by Chinese authorities without a fair trial. Other countries have been reluctant to offer any of them refuge in fear that problems would result in their relations with China.

In 2006, Albania did agree to take five of the detainees, who had been determined to have the most tenuous connections with ETIM.

That left 17 in Guantanamo. In October 2008, a federal judge in the District of Columbia ordered that all of these men -- all 17 -- be freed into the United States immediately on the grounds that there was no evidence to justify their continued detention. Within days, however, the Justice Department was granted a stay on this ruling, arguing that the men posed too much of a danger to the United States to allow them refuge in America.

It is apparently on the grounds of this October 2008 court decision that the Obama administration is now considering their release.

So what is ETIM? Is it a terrorist organization?

The most disturbing aspect of the seven-year odyssey experienced by the Guantanamo Uyghurs is that little if any evidence has emerged showing ties between ETIM and Al-Qaeda, or even that it is a terrorist organization.

During my many years working in the Uyghur community of Central Asia, I never heard of ETIM. And most Uyghurs I know never encountered it or heard of it prior to 2001. If it was an active group, it was obviously marginal in the constellation of Uyghur diaspora political organizations.

Although the organization itself does appear to at least have existed (under the name of the Eastern Turkestan Islamic Party) when it was classified as a terrorist group, its alleged leader at that time, the late Hasan Mahsum, told one journalist that it was not anti-American and never received financial assistance from the Taliban or Al-Qaeda.

Generally, Mahsum’s assertions make sense. Uyghur organizations have never been anti-American in character, and have little reason to be, given that their political goals are exclusively related to their relationship with the Chinese state. Furthermore, as early as 1999 Indian sources reported on Chinese agreements with the Taliban that ensured that the Taliban and its allies in Afghanistan would not support Uyghur separatists.

Since Mahsum’s assassination by the Pakistani army in October 2003, nothing has been heard from ETIM or specifically about its activities. Furthermore, reliable contacts of mine in Pakistan’s Northwest Frontier who follow these issues have told me that they have not heard of any active Uyghur groups in the country’s tribal belt.

Even more interesting, there is no conclusive evidence that ETIM has ever perpetrated a terrorist attack. While the Chinese government has claimed that various acts of violence in Xinjiang and Central Asia over the last decade were the work of ETIM, this has never been proven; and the acts of violence to which they are referring also may not even have been terrorism. Moreover, no Uyghur group has ever been tied to well-known methods of terrorism such as car-bombings or suicide bombings, acts that could confirm links to sophisticated transnational organizations such as Al-Qaeda. Instead, they have been accused of organizing disturbances and assassinations, which could be alternatively explained by a variety of other motives from popular political dissatisfaction to personal vendetta and crime.

The incidents of violence in the run-up to last summer’s Olympic games are a prime example of the lack of clarity surrounding alleged ETIM terrorist attacks. The most publicized of the supposed terrorist attacks in China last summer allegedly involved two Uyghur men driving a truck into a group of Chinese soldiers in the Xinjiang city of Kashgar, and then attacking them with knives and throwing homemade grenades. While a video on YouTube allegedly made by a group called the Turkestan Islamic Party or TIP (which “terrorist experts” tell us, with no supporting evidence, is another name for ETIM) claimed responsibility for this attack, the lack of sophistication demonstrated by its perpetrators invites skepticism. Furthermore, nobody in the international Uyghur community has indicated knowledge of who produced this video or others bearing the TIP brand. In all likelihood, these videos, which only recently began appearing, are disinformation prepared by either Uyghur nationalists or the Chinese state for the purpose of exaggerating the Uyghurs’ capacity to undertake terrorist attacks in the name of their political goals.

When one looks at all of this evidence (or lack there of), it is difficult to understand how the United States decided to place ETIM on a list of dangerous terrorist groups to begin with. Was this, in fact, a political act of appeasement to the Chinese government? Are there other groups on this list from elsewhere in the world that were likewise included among our enemies in the war on terror under dubious circumstances?

Undoubtedly, it is time to release the Guantanamo Uyghurs. In doing so, however, it may also be time to review our intelligence on ETIM and other alleged terrorist groups we are targeting in the war on terror, even indirectly through such methods as financial sanctions.

In all likelihood such a review will find that much of our intelligence on alleged terrorist groups like ETIM comes from foreign intelligence organizations in countries with a conflict of interest. It has not been a secret that we have increasingly relied on collaboration with intelligence services of tenuous allies in the war on terror, such as China, Russia, the Central Asian states, and Pakistan. Can such intelligence be trusted to help the United States decide who is our enemy?

In the case of ETIM, Chinese intelligence has good reason to suggest that there is a Uyghur terrorist threat. Beijing does not tolerate Uyghur political dissent, and international recognition of a Uyghur terrorist threat gives the government a freer hand in cracking down on internal political dissent in Xinjiang.

The Central Asian states and Pakistan likewise have reason to exaggerate the Uyghur terrorist threat in order to win favor with China. Equally, for the Central Asian states, a local threat of Uyghur terrorism provides a way to engage the U.S. in the war on terror without implicating their own people. And for Pakistan, it is yet another means of deflecting attention away from that country’s own indigenous terrorism problem.

If the debate over the Guantanamo Uyghurs facilitates a closer look at how groups like ETIM are being classified as terrorist organizations, it may play a critical role in helping the Obama administration to re-define the war on terror in a way that more clearly defines our enemies and that is ultimately more rational and winnable.

In the meantime, the 17 Uyghurs who remain in Guantanamo should be released into the U.S. now as a matter of preserving America’s image as a nation that upholds the rule of law and human rights.

I would gladly attend their welcoming party in Fairfax, Va.

China's Challenge to the U.S.

The financial crisis has accelerated China's challenge to the U.S. There is Beijing's more assertive acquisition of oil and metals properties around the world, particularly in Russia, Brazil and Kazakhstan. But it's also been making noise about bringing down the dollar as the premier global currency held by central banks.

When the Chinese first raised the idea loudly in March, they were almost unanimously derided -- the dollar was king, and despite the financial crisis abetted by loose U.S. regulation, it would remain king. Two months later, few are still laughing.

As I write in today's Business Week on-line, China has taken numerous steps making it clear that it is deadly serious. "You are witnessing the Chinese starting to make the renminbi an international currency," Dennis Wilder, a China expert at the Brookings Institution, told me.

Some remain unconvinced. Steven Schrage, who runs the international business program at the Center for Security and International Studies in Washington, called China's moves "a lot of saber-rattling."

At Forex News, Andrei Moraru notes that the Chinese continue to tightly control their currency.

There may be some factor of saber-rattling. And Beijing does keep a tight rein on the renminbi. But over a longer time frame, meaning 10 or 15 years, the broad consensus seems to be that it makes sense for the renminbi to take its place among international, fully convertible currencies. As that happens, and China's economy continues to grow, its currency will also be held by more and more central banks (it is already held by a handful because of so-called currency swaps by Beijing). Bonds will be issued in the Chinese currency.

At Shadow Warrior, San says that China is simply "moving to protect their own future in bypassing the US currency." San argues that India needs to think about doing the same. Now, that looks a bit unlikely even in China's time frame.

Iran's Election, and the Tehran-Moscow Alliance

Would a new Iranian president change the complexion of relations with the United States?

That’s the conventional wisdom. It’s also the hope in Washington and elsewhere. With Mahmoud Ahmadinejad in another term as president after the June 12th elections, the thinking goes, there will simply be more nationalist and anti-Semitic bombast; in contrast, a new president will doubtlessly continue to embrace uranium enrichment, but will be less reliant politically on an antagonistic relationship with the U.S.

Whatever the case, the president ultimately is not Iran’s principal power. That position in society is held by Ayatollah Ali Khameini, who ultimately balances Iran’s various religious, commercial and political forces, and forms the consensus that we see as Iranian policy. He is whom President Barack Obama is directing his diplomacy.

That’s more or less what was laid out today by Trita Parsi, president of the National Iranian-American Council and author of the award-winning Treacherous Alliance: The Secret Dealings of Iran, Israel and the United States.

Parsi addressed a small group at the National Foreign Trade Council in Washington, where he argued against any further hardening of economic sanctions against Iran (there is a push to block refined oil products from Iran, whose refineries product far less fuel than the country requires). Parsi argued that such a move would work against U.S. interests, driving Iran away from the negotiating table, while doing nothing to loosen its resolve to go its own way on nuclear development, Hezbollah and so on.

I filmed a clip of Parsi’s reply to a question on Iran and Russia’s tactical alliance. While he didn’t predict the disintegration of the alliance, he did note that it’s built on soft sand, given the two nations’ long and deep distrust.

The Latest Buzzword: Smart Grid

The Obama administration is making a big push to upgrade the nation's electricity grid. But what is "smart grid," the latest buzzword in the green-speaking world?

The Center for Strategic and International Studies today held the first of what it promises will be several 90-minute sessions to explain (The short answer is that demand would be better monitored to optimize and reduce the use of greenhouse gas-producing fossil fuels. A smarter grid, I was told yesterday by Sally Benson at Stanford University’s Global Climate & Energy Project, would monitor and regulate supply as well. But that’s far, far down the road.).

The CSIS session came a day after the Department of Energy gave smart grid advocates and developers a huge boost by serious increasing available project funding; in one program, recipients can receive up to $200 million, up from the previous sum of $20 million.

Katie Fehrenbacher at earth2tech suggests that Energy Secretary Steven Chu appears to have been focused on security, because five of the 16 standards he announced as part of the smart grid program relate to security.

If you watch this video clip from the CSIS session, you’ll see that physical security – versus vulnerability to cyber-attack – definitely seems to be a worry. The speakers are Jeff Wright, of the Federal Energy Regulatory Commission, and Lawrence Jones, of the France-based power-production company AREVA.

The DOE announcement brought the blogosphere alive. Keith Johnson over at WSJ’s Environmental Capital wonders rightly whether the DOE program is aimed at utilities or their customers. He notes that projects he’s seen in Boulder and Miami seem like the former.

Heather Clancy at GreenTech Pastures isn’t surprised that Cisco veritably leaped into the competition for building smart grid infrastructure. She also thinks that Cisco will snap up smaller players in the market. History suggests she is right.

What Nobody Told Jonathan Dahl

In general, it's a bad idea to get an oil company-branded credit card. It's never a good idea to pay for gas using a debit card. And don't be fooled by claims of superior mixes of fuel -- mostly gas is gas.

This is all according to Jonathan Dahl (an old buddy of mine from Columbia University) and other editors at Smart Money, the financial magazine, in their new book, 1,001 Things They Won't Tell You: An Insider's Guide to Spending, Saving, and Living Wisely.

The book dashes through the various stages of about everyone's life: wedding, children (and education), home buying, ordinary purchases, dining, medical care and so on (oddly, there is no chapter on death or funerals).

This being O&G, I went straight to the sub-chapter on buying gasoline. One of the best bits of advice: Skip the Starbuck's. Gas-station coffee is just fine, and costs a lot less.

An Encounter With the Tamil Tigers

I walked by the White House yesterday, and before it was a shouting crowd of ethnic Tamils, pleading with President Barack Obama to intercede to get the Sri Lankan government to stop its assault on the north of the country and the Tamil Tigers. But Obama could do nothing, and nor should he have -- the Tigers long ago morphed from a defender of the Tamil people into the senseless killing machine of a self-interested terrorist named Velupillai Prabakharan. It also was a vain effort -- the protest coincided with the final crushing of Tigers, and the death of Prabakharan. (The L.A. Times' Mark Magnier has a good profile of him today.)



My own interest in the Tigers goes back to 1991. I was among many South Asia-based foreign correspondents who had turned their gaze from Afghanistan to Sri Lanka, the pristine island nation at the southern tip of India. The government was facing a deadly challenge from the Tigers, who were getting excellent media coverage as protectors of a marginalized minority, the Tamils. But when correspondents went down for a look, they didn't always return glad-eyed. One colleague described arriving in the capital of Colombo, driving out to the city, turning back around, and flying straight back to Delhi. The place simply gave one the spooks.

My specific entry point into things Tamil occurred in May 1991, and the suicide assassination of Indian Prime Minister Rajiv Gandhi. Newsweek sent me out to Madras in the hours after the killing. At the site of the attack, I came upon a man digging gingerly, like a surgeon, in the dirt. He was P. Chandrasekharan, a senior investigator, and in his hand were dozens of tiny pellets smaller than BBs -- part of the bomb belt worn by the killer, who had approached Gandhi at a ceremony in a manner of respect before blowing herself up. Chandrasekharan and the other Indian investigators were masterful. Though Gandhi, his killer and 14 others were torn apart by the bomb, the investigators were actually able to find (alert: next part not for delicate sensibilities) the killer's face -- not her head, mind you, but her face -- amid the carnage, identify her and track her origins (end alert). She was Thenmozhi Rajaratnam, a rank-and-file member of the Tigers.

It was the Tigers' signature. Just a few months earlier, they leveled several buildings in downtown Colombo, killing 19 people, in order to detonate a car bomb that also assassinated Sri Lankan Defense Minister Ranjan Wijeratne. The year before, the Tigers shot down 147 Muslims as they prayed in the town of Kattankudy. Of course the Tigers' biggest prize next to Gandhi was yet to come -- two years later, they would assassinate President Ranasinghe Premadasa.

In the coming months, I went down to Colombo myself. There, I set about making contacts among local journalists in an effort to make the trip north to the Tamil capital of Jaffna. After a week or so, I had a proper contact, a driver (whose name escapes me), and we left.

We reached Jaffna easily enough after a long passage first across government lines, then into Tiger territory. But that evening there was a knock on my hotel door: A young man entered, and said my driver was under arrest.

Arrest?

Yes, said the gentleman, who identified himself as an officer of the Tigers. The driver was a spy.

What I hadn't known was that the Tigers had evicted the entire Muslim population from the north over the previous two years. The driver was Muslim; he had neglected to say anything.

My only recourse at the moment was to insist that, as a courtesy to a foreign guest and a journalist, the driver be confined to the hotel and not taken away anywhere. That was agreed.

When I went to the driver's room, he had only one thing to say: "I don't want to die." I assured him everything would be fine. Foreign journalists didn't ordinarily speak with Prabakharan himself -- I knew no one who had -- but I said I would talk to the local Tiger leadership.

Meanwhile, I drove myself around town for the next four or five days in his car. All seemed quiet and orderly. Apart from the fact that my driver was under arrest, life in Jaffna was as the media presented it -- the Tigers seemed to be embraced by the population as much-needed protection against the Sinhalese government.

One day, though, as I strolled downtown, a man whispered as he shuffled past, something along the lines of Don't believe everything you see or hear. Then he vanished.

I began asking around quietly about life among the Tigers, and learned that in fact a lot of the people in Jaffna were terrified. They had to watch what they said and did in order not to be accused of treachery by the Tigers; the penalty of crossing the line could be death. Contrary to the propaganda, they definitely were not in charge of their own lives nor their future.

That's the first story I wrote for Newsweek when I got back -- about life under the Tigers. Then I started digging in to how the Tigers financed themselves, which I discovered involved arms smuggling on their own ship to southeast Asia; heroin smuggling to Europe; and "donations" from Tamil immigrants abroad. Abroad, a lot of Tamils worked in banks. Tamil immigrants in Canada, Britain and elsewhere would be visited by fellow immigrants living in town; they would be told that they were expected to tithe a specific sum every month for the Tigers. How did the visitors know how much? Why, the Tamils working in the bank had checked how much salary they were depositing. I filed that story next for Newsweek.

Back to my driver: The Tigers decided out of compassion to let him go. They bundled him, blindfolded, into a van back south. I followed in his car. At the boundary of Tamil and government-controlled territory, they let him out and told him never to return.

Fossil Fuel Use: An "Urgent" National Security Threat

A dozen retired senior military officers have come out today with a report calling the way we use energy an "urgent" national security threat to the U.S. In a long report, these former officers detail how long, vulnerable fuel supply lines have hobbled troops in Iraq and Afghanistan; how each soldier in Afghanistan is weighed down by 26 pounds of batteries; and how just 10% of the fuel used in Iraq goes for actual fighting vehicles -- the rest just gets the fuel to the battlefield and protects it.

These dozen retired generals and admirals call on the Pentagon to take the lead in finding and scaling up an alternative to fossil fuels as a national security imperative.

Their conclusions are reached by an Alexandria, Va., think tank called CNA, which runs a body called the Military Advisory Board.

I talked to a couple of the report's co-authors. One of them, retired Air Force Lt. Gen. Larry Farrell, noted that the military has already led the way in the past in developing the Internet; it's also done so with cultural change, such as integration. In case any lifestyle change is necessary because of an alternative fuel, "people will see that if it works for the military, it will work for a lot of other things as well," Farrell said.

Two years ago, the board declared climate change a national security threat. This is a follow-on report. I write about it in today's Business Week on-line.

Over at Solve Climate, Bill Becker sees the report as "the cavalry (and the Navy, Air Force and Marines) coming to the aid of a green army that is vastly outnumbered and out-funded by the oil and coal lobbyists on Capitol Hill."

Becker is referring to the wrangling that's accompanied congressional debate over a proposal to limit greenhouse gases with a carbon-control system called cap-and-trade, which Karla Bell over at the Huffington Post says has to be finalized by May 25th. Today's report is sure to be injected into the partisan debate.

Dueling Scenarios on the Gazprom State

Choose your scenario: Portraits in The Wall Street Journal and The New York Times today provide starkly different measures of Russia's energy might.

The Journal’s Guy Chazan chronicles a fresh set of agreements that, if carried out, will double the size of Gazprom’s proposed South Stream natural gas pipeline. The pact was co-signed by Paolo Scaroni, CEO of Italy’s ENI, a frequent partner of Gazprom’s whose company will help build the line. Standing with Prime Minister Vladimir Putin, Scaroni succinctly described the reason for South Stream: "Most of this gas will substitute gas currently crossing Ukraine, and some new gas."

In other words, South Stream is meant to extract Ukraine from Europe’s natural gas equation. Fair enough – from Russia’s point of view, that's perhaps the only way to end once and for all its annual tugs-of-war with Ukraine over natural gas payments and the resulting gas cutoffs to Europe.

Raising the financing actually to build South Stream is another matter. Yet, despite the plunge in global energy prices and the financial crisis, Russia’s aims seem the same: To reinforce the weight -- its energy heft -- behind its restored global voice.

In the Times, however, Andrew Kramer delivers a page-one, above-the-fold story with basically the opposite message: The Kremlin’s efforts to use Gazprom to “restore Russian influence in the world are now backfiring, slashing both its profits and its influence.” The culprit is the price plummet.

Kramer backs up his lead with detail on the losses being absorbed by Gazprom on its long-term natural gas supply deal with Turkmenistan. Gazprom is paying the Central Asian nation $340 per 1,000 cubic meters for gas that the Russian giant sells on to Europe for $280, or a $60 loss on each 1,000 cubic meters. This has helped to crater Gazprom profits, Kramer writes: The company’s 2008 profits were $30.8 billion on revenues of $160.5 billion, according to annual results released this month. This year, Troika Dialog, a Moscow investment bank, has estimated that Gazprom’s profits will drop to $16.7 billion on revenues of $104 billion.

There is a bit of confusing data -- Kramer says the price received by Turkmenistan is based on a six-month delay; in other words, Turkmenistan is being paid today according to world prices last year (I’ve actually heard that the delay is eight months, but the principle remains the same). If that’s the case, the loss would work its way through the system soon enough: Turkmenistan would eventually start receiving payment based on the dirt-cheap, current price of natural gas.

Whatever the case, another section of the story is key. Kramer suggests that Gazprom has lost ground politically, noting that last week, the European Union signed another agreement vowing to build Nabucco, a rival natural gas pipeline to South Stream. Azerbaijan, Georgia, Egypt and Turkey were present for the accord.

The piece, however, does not note who wasn’t there to sign: Kazakhstan, Turkmenistan and Uzbekistan, the key natural gas suppliers. Nor does it note that there is every chance that Azerbaijan will sell much of its natural gas to Russia, which continues to offer to buy all of Azerbaijan’s supply. (Neither does it mention the South Stream signature agreement.)

For now at least, it seems to me that the Chazan scenario is more credible: Gazprom has its problems: It is failing to invest in arresting the depletion of its Russian fields. All the while, natural gas demand is plummeting.

Yet it’s early to suggest that Russian influence in its backyard or Europe has declined with it.

Why Are Oil Prices Rising?

Many are asking the question about oil prices: Is this deja vu all over again? Didn't we just go through a several-year run-up in prices based largely not on fundamentals, but on traders bidding them up, ultimately to $147 a barrel? Only then to see them plunge to $32 a barrel?

If one puts stock in the plunge, then there appears to be air in the run-up today to a six-month-high of $60 a barrel. How much is anyone’s guess. The other day, one exceedingly smart oil analyst privately put it in the range of $5 to $10 a barrel.

Here is the case for a price bubble: Oil inventories are at a 19-year high; the U.S. alone has some 1 billion barrels sitting in storage tanks, according to Mark Williams at the Associated Press. Demand for oil is set to fall to its lowest level in five years, says the U.S. Energy Information Administration.

The opposite case goes as follow: The market is factoring in expected inflation because of global deficit spending; Chinese investment spending is reviving. Over at Alaron, Phil Flynn says these are also genuine “fundamentals.”

Regardless, there always seems to be reason offered up to trust in a price run-up. After all, markets are all about emotions, as Robert Shiller notes. Yet, there are still sober voices. In my view, the Financial Times’ Chris Flood delivers it straight: Prices are rising because of various types of trading gambles. Flood quotes Mike Wittner, a senior oil analyst at Société Générale saying the following: “Recent price strength is not based on fundamentals, but on financial flows.”

Over at the Oil Drum, Rune Likvern says up to 3 million barrels a day of oil is being bought purely for storage, including on the sea. But he predicts that such purchases – which help to prop up prices – will decline because storage is becoming harder and harder to find; when they do, Likvern says, prices will fall substantially.

It’s a fool’s game to predict oil prices. That doesn’t stop a lot of people, of course, especially the traders.

Watching the Pakistan Army

By appearances, the Pakistan Army has at last recognized the grave threat facing it and the secular government. There are no independent eye-witness accounts of the actual fighting in the Swat Valley and Buner. But there are reports on the Taliban digging in within the city of Mingora and elsewhere, as the PrairiePundit notes.

The BBC is often the best reporting from the region. Here is a BBC video report.

Will the Army dislodge the Taliban entirely from Northwest Frontier Province? Over at Israpundit, Salim Mansur argues that Pakistan is already "more or less a Taliban state." At Op-Ed News, Michael Collins labels concerns of a Taliban state in Pakistan "The Big Con." With respect, both of these views are seriously misled.

As discussed previously at O&G, Pakistan is nowhere near "a Taliban state." In addition, the threat is not that the Taliban captures power in a frontal assault, which appears to be the only way these pundits-from-afar can imagine such a change of government taking place. Instead, the risk is that, over time (it took two years for the Taliban to manage this during the 1990s in much-less-difficult Afghanistan), the Taliban captures more and more territory; long-ago-trained militants living in villages and towns across the Punjab start their own anti-state activities; and there is a tipping point at which important elements of the Army simply turns.

Why would middle-ranking Army officers and jawans tip this way? Because they would regard such as move as them taking power. They would be fooled, as were countless Afghans, by Taliban promises of power-sharing.

The Balance of Power in the Former Soviet Union

Moscow's envoy to NATO has signaled that Russia is ready to resume the thaw in relations triggered last month in the G20 meeting in London between presidents Barack Obama and Dmitry Medvedev. Russia had been miffed by NATO exercises going on in Georgia, and canceled a planned meeting with NATO this month. But now Dmitry Rogozin, Russia's envoy to NATO, says, "We will go ahead with restoring relations." Russian Foreign Minister Sergei Lavrov said much the same when he met with Obama and Secretary of State Hillary Clinton in Washington last week.

Yet Rogozin and Lavrov can behave statesmanlike because in a big way recent events have gone Russia's way.

NATO proceeded with the exercises despite Russia's objections, thus ostensibly demonstrating that no country will determine who can join the military alliance, and where it will act. But look under the hood. One of the nations missing from the games is Kazakhstan -- President Nursultan Nazarbayev declined to send troops to the month-long games. Why did this deft balancer of great powers go along with Russia's wishes on NATO? Perhaps he would have declined even if there had been no Russia-Georgia war last summer, when Russian troops overran large parts of Georgia in anger over Tbilisi's violence in South Ossetia (or perhaps Kazakhstan simply didn't want to go, as the country itself explained.). Yet, Russia's former colonies are behaving with more circumspection than, say, a year ago, and one suspects that the August war is much responsible for that.

A super-smart former senior U.S. diplomat to the former Soviet Union told me yesterday over coffee that the U.S. has not yet lost its influence in the Caucasus and Central Asia; the August events, he said, were "a shot over the bow." But an actual "diplomatic disaster," he said, would come only if Russia actually overran all of Georgia, and seized control of the Baku-Ceyhan pipeline, along with some of the financial benefits accruing to such a move. In this former envoy's view, possession of the "economic rent" would be "qualitatively different" from the current state of affairs, because it would amount to effective Russian reconquest of the Caucasus and Central Asian states.

Possession of the economic benefits -- meaning the pipeline transportation tariffs -- would be different. But I don't see Russia making such a move, one reason being that it doesn't have to: Actual occupation of Georgia isn't necessary; rather, with the August war, Russia signaled that it is prepared to go to any lengths -- in this case military -- to enforce its will. The outcome has been one 'Stan after another falling into line.

Kazakhstan's non-participation in the NATO exercises is just one sign of that. In another, just two days ago, the European Union signed an agreement that Dan Bilefsky of the NYT describes as intended to speed up the Nabucco natural gas pipeline, the western-backed effort to reduce Russia's energy influence in Europe; Kazakhstan, Turkmenistan and Uzbekistan -- the current biggest sources of natural gas for the line -- declined to sign. Diplomats told Bilefsky that the three countries did so "because of pressure from Russia." Moreover, after meeting with Medvedev, Azerbaijan President Ilham Aliyev suggested that he will sell his country's natural gas to Russia, at the same time that Europe and Washington have all-but begged him to commit his gas to Nabucco. There has been a mood shift recently in the U.S. on whether Nabucco is singularly important; yet it's one thing determining that in the West, and quite another doing so in Moscow.

Meanwhile, on the military front, there is the U.S. ejection from its military base in Kyrgyzstan in favor of Russia.

Current and former U.S. officials with whom I've spoken in the last week or two hew to the belief that the August events were strategically meaningless to the U.S. That is, that the U.S. retains roughly the same influence across the Caucasus and Central Asia as it did prior to the war.

The truth is that U.S. energy policy in the region is a shambles. A U.S.-Iran rapprochment could change that (there is a genuine chance, for starters, that Mahmoud Ahmadinejad will lose the presidential election next month. His three major rivals, while perhaps not differing substantively from Ahmadinejad, are distinctive from him in tone and approach. Talks with the U.S. could be much smoother.).

The State Department has a super-skilled diplomat on Eurasian energy in the form of Dick Morningstar. At the National Security Council, my former Stanford colleague Mike McFaul is clear-eyed on Russia; and, with the Obama administration fixated on alternative energy and climate change to the exclusion of any expertise in oil and natural gas, NSC Adviser Jim Jones is seeking a much-needed senior director for global energy, I'm told.

Washington has no equivalent in this sphere to the roles played in South Asia by Richard Holbrooke and in the Middle East by George Mitchell. Perhaps the combination of talent in State and on the NSC will be sufficient to handle the complex brief straddling the lines of Russia, the 'Stans, Iran, nuclear proliferation and energy.

Obama: The Wrong Interlocutors

President Obama will meet tomorrow with the leaders of what are, in terms of security, the two most crucial nations on the planet. Neither of the two men -- Pakistan's Asif Zardari and Afghanistan's Hamid Karzai -- are fond of Taliban-like politics, nor militants. But they also are utterly weak figures lacking the political support to stand on their own two feet, and are disrepected by stronger forces around them. So one can be cheered at the administration's continued support of the two countries' attempts at democracy. But in the end, a reduction of the threat of a Taliban takeover of the region depends -- as it always has -- on the Pakistan Army.

In today's Washington Post, my friend Ahmed Rashid correctly notes that the Taliban threat is not isolated or overstated, as some claim; at the New American Foundation, for instance, Peter Bergen argues that concerns about this threat have risen to the level of "hyperventilation." Rashid writes compellingly that Pakistan is "on the brink of chaos," with militants cultivated by the Army's InterServices Intelligence directorate present and strong in all four of the country's provinces.

In a story borrowing from his book, The Inheritance, David Sanger at the New York Times reports that U.S. officials remain worried about the integrity of Pakistan's nuclear arsenal. Could some of the fissile material or even a bomb get lost? That's the fear.

Simon Cameron-Moore at Reuters has made much of the fact that the specter of one's demise can concentrate the mind; this is in the way of explanation of why Pakistan's Army is suddenly on the march in Buner and Swat. Yet, it is notable that Pakistan allowed the Taliban such a foothold that this mighty army -- believe me, the Pakistan Army is a serious force -- is compeled to fight door to door to dislodge them, as Zahid Hussain is reporting in the Times of London. Reuters' Junaid Khan reported today from the field that hundreds of civilians are fleeing, implying that more trouble is on the way.

I personally don't see how the situation gets turned around in the short or the medium term.

The Irrelevancy of Nawaz Sharif

If the New York Times has it right, the Obama administration thinks that the prime ministership and presidency of Pakistan are decisive positions in the pursuit of the Taliban. In a piece today by Helene Cooper and Mark Mazzetti, we learn that the administration is courting former Prime Minister Nawaz Sharif, who has zero influence over the Taliban or any other militant in Pakistan or anywhere else.

It's not that President Asif Zardari has relatively more influence than Sharif with the militants. Neither of them does. (In fact, neither of these fellows is particularly impressive in person.) The point is that anyone seeking to resolve the Taliban advances must do so through the Army and its intelligence wing, the InterServices Intelligence directorate, both of which are seriously entangled with the militants. Majed Iqbal discussed the topic of Sharif's rising favor a week ago. Aiming any attention at the political structure is wasted energy.

One matter we have not discussed here earlier is the utter failure of successive Pakistani governments going back two decades to lay the groundwork for confidence in civilian, secular rule. The main failure has been in education. The CIA says that 49% of Pakistanis over the age of 15 are literate; that's certainly a generous figure. The indicator is also a shrinking one -- in 1980, according to the United Nations, about 72% of adults could read and write. Whatever the precise figure, the government has decided to channel almost all its money into the Army, thus leaving its people reliant on madrassas, and seething in anger at their leaders.

Would a different president or prime minister aim more attention at improving the lives of ordinary Pakistanis? Perhaps. Meanwhile, this failure is the river in which the Taliban are swimming.

James Giffen's First Line of Defense Appears to Fall

He may yet be the beneficiary of an intervention the likes of Ted Stevens, or Keith Weissman or Steven Rosen. Short of that, it appears that former Kazakhstan middleman James Giffen is going on trial.

As O&G readers know, Giffen is the most extraordinary of the middlemen whose wiles made the Caspian era work. He was responsible for Chevron, Mobil, Texaco, Phillips and other oil companies getting their deals in Kazakhstan. But in 2003, he was arrested at JFK Airport on bribery and money-laundering charges, and his case has been languishing ever since. At that time, it was the biggest U.S. foreign corrupt practices case in history.

The last time we discussed the case, this former uber-consultant to Kazakhstan President Nursultan Nazarbayev appeared to be succeeding magnificently with his I-was-a-CIA-asset defense. That is, the 69-year-old Giffen asserted that, if he indeed did serve as a channel for some $80 million in oil company payments to the Kazakh president and his pals, as U.S. prosecutors in New York contend, he did so with the understanding that he was serving the interests of U.S. intelligence agencies. It being the time of the ultra-secretive Bush administration, the CIA predictably appeared to drag its heels in producing the top-secret documents that Giffen's lawyers sought in order to prove his case. That was six years ago. Finally, last September, exceedingly patient U.S. Judge William Pauley told prosecutors effectively to put up or shut up. That is, they either had to make their case with the documents, or risk a ruling that Giffen's 6th amendment rights to a speedy trial were in jeopardy. Indeed that seemed to be Giffen's calculus -- he could get some or all the charges dropped if he simply relied on what seemed the most hard-and-fast of the Bush era doctrines, that of scant regard for the Watergate-era laws of a free flow of information.

Until now. The court releases almost no information about the case, treating it almost as cautiously as the Guantanamo detainee cases. Giffen's lawyer, William Schwartz, himself did not answer two emails I sent him for comment. But there are hints on the most recent entries on the case docket.

On April 23, there are two entries. One shows that the CIA has finally produced at least some -- and perhaps many -- of the documents that Giffen sought.

The Agency is still playing coy. Judge Pauley appears to have granted a prosecution request that only Giffen's lawyers -- and not he himself -- be permitted to examine the documents, unless the CIA grants specific permission for specific papers. Apparently U.S. officials do not trust Giffen with such access.

In the second of the two April 23 entries, Schwartz has written a letter regarding Pauley's ruling. One can infer that he is arguing that unless Giffen is permitted to directly review the documents, his defense team cannot be expected to understand all possible hints or references contained within them. Hence, it is another dimension of the fair-trial argument.

Whatever the case, these are mere details. The next hearing is June 4. Giffen can and probably will still mount his CIA defense. But, short of an unlikely plea deal, look for a trial to begin this year.

A U.S. Connection: An Internet Solution for Central Asia

By Sasha Meyer

Experts have been criticizing the U.S. and the European Union for "losing Central Asia." They say the West is mostly pursuing its national interests, while abandoning support for the development of civil society in the region.

But with the new U.S. budget increasing spending overseas by 10% on the way to doubling foreign assistance, there is a way both to redress this policy imbalance and create jobs in the U.S.: The Americans could set up a satellite Internet service for Central Asia (including Afghanistan).

Japan and Google-backed o3b are good role models. The former plans to provide fast Internet access to the Pacific region, and the latter in Africa, Asia and Latin America.

Japan's satellite for the job, Kizuna, is a record-setter. It's capable of providing a 155 Mbps connection to households equipped with a pizza-sized dish. With a larger antenna, 1.2 Gbps is possible. That's about 20 and 150 times faster, respectively, than typical broadband service in the US.

That's also a much-higher speed and capacity than anything achieved previously via satellite. The end-user equipment is inexpensive and is getting smaller and mobile. For example, two American companies - TerreStar Corp. and SkyTerra Communications Inc. – plan this year to offer U.S. consumers satellite-based phone and Internet service via BlackBerry-sized devices.

This new connectivity in Central Asia would bypass the local telecoms systems that like to block access, and would thus expand the region's links to the outside world. But more importantly, it would ensure a free flow of information within the region and lead to a more active citizenry and greater transparency.

Web use in Central Asia would probably repeat patterns elsewhere. In China, netizens are increasingly taking on corrupt local officials (with Bejing's encouragement). In South Korea, an online newspaper run entirely by citizen reporters has influenced the outcome of a presidential election. And in Nepal and Rwanda, farmers use the Internet to conduct business. Distance education, telemedicine and better disaster recovery would also become possible.

This service would likely be rapidly adopted for several reasons. The idea is already familiar, as local telecoms offer something similar. And the end-user gear would probably find its way into the hands of Central Asians fast. Technology has a tendency to become cheap and overcome even the biggest obstacles. For example, Andrey Lankov, a leading expert on North Korea, writes that DVDs and PCs are spreading in the hermit kingdom even though Pyongyang has exercised stricter control over its population than Stalinist Russia ever did.

Demographics would also favor a speedy take up. The majority of the Central Asians are young. And this generation is different from its predecessors. Don Tapscott, who studied youths in twelve different countries, writes: "As the first global generation ever, the Net Geners are smarter, quicker and more tolerant of diversity than their predecessors.” They also value choice in everything and expect constant innovation. His findings are surprisingly similar both in the rich world and developing countries, irrespective of the local culture.

Although this undertaking wouldn't be cheap - the price tag for Kizuna and Ob3 is around $500 million – the cost is comparable to what the U.S. is already spending in the region, such as the $183 million used on the headquarters of the Afghan air corps.

But working in its favor in terms of U.S. politics is that the money would generate jobs in the U.S., as the spacecraft would be built, launched and operated by U.S. companies. Furthermore, R&D that goes into this kind of project would help sustain America's technological lead: Kizuna is part of Japan's plans to become world's most advanced country IT.

Finally, the costs could be reduced by bringing into the project both the EU and Japan, which seems to have a growing interest in the region, given its Central Asia+Japan initiative. Finally, coverage can be easily scaled up to include South Asia, since a satellite in GEO orbit can see one-third of the Earth's surface. A good example is WildBlue that started out with a single spacecraft serving customers across the entire U.S.