The deal struck by Condoleezza Rice with the Czecch Republic to install US radar system to augment its missile defense system in central Europe as well as the US / Georgia joint military exercise code named Immediate Response 2008 have provoked Dmitry Medvedev, the Russian President.
The German Alexander Rahr, noted expert on Russia has said, "Russia's veto is in response to the missile shield ... Russia is trying to show that America cannot decide everything."
Russia also announced that for the first time since 1991, its war ships will resume patrol of Arctic waters.
M K Bhadrakumar writing for Asia Times Online suggests that the trigger behind these escalating events might be energy security. One of Medveded's first orders after taking over the Presidency in May was the "expeditious completion of the first stage of the Eastern Siberia Pacific Oil Pipeline (ESPO) by end-2009." Seeking to balance its exports between Europe and the Pacific rim Moscow seeks to increase its oil exports to the Pacific from the current 3% level to one third by 2020.
While touring the Caspian region in early July, Medvedev "made a stunning offer that Russia was prepared to buy Azerbaijan's entire gas output at market prices." In Turkmenistan he supported the commitment to modernize the Central Asia-Central pipeline and the building of a new littorial Caspian pipeline.
But the biggest burr under the Bush administration's saddle was the announcement that Gazprom, the world's largest extractor of natural gas, plans to build a pipeline across the Medditeranean to pump Libyan gas to Europe. Gazprom would handle Libya's entire oil, gas, and liquified natural gas for export to the US and Europe.
Furthermore, Gazprom wants to buy exploration licenses in Nigeria and has proposed to build a pipeline from Nigeria to Algeria and in conjuncture with the Algerian government is developing a proposal to joint market gas to Europe.
The US retaliated by cutting Russia off from Iraq's oil, even though in February, Russia had written off 93% of Iraq's oil debt ( valued at $12 billion, US). Rather than getting angry, Russia went to Tehran and recently got a deal signed for Russian companies to develop Iran's oil and gas fields.
The so-called "international packages of incentives" to get Iran to stop their nuclear program is quite likely to include access by US companies to Iran's energy resources, given Halliburton's previous prominence in Iran.
Bhadrakumar writes that "The geopolitics of energy security are a highly sensitive subject for the Bush administration, whose profound links with Big Oil are legion. It is a tremendous loss of face for the Bush-Cheney-Rice combine that Moscow is outwitting the US on the energy front. "
Knowing the pique, pettiness, and rueful disdain of the Bush administration towards those who oppose it, expect escalating responses. One more mess for the incoming US president to deal with.
Fighting two wars, a justice department inquiry into the Valerie Plame scandal, figuring out all the democratic targets for the justice department to take down, firing 8 states attorneys, cutting taxes for hedge fund managers, dealing with the fallout from the Enron scandal, the housing market meltdown, this is all real hard work.
When you lie for a living, and have to keep track of all the lies, and when you believe that military force is the way to make nations bend to your will, when you believe that you create your own reality, it must be very disconcerting to wake up and find that the world goes on without you and that other nations who deign to try the fine art of diplomacy can trump you.
Note too - Russia HAS a national energy policy. (The Bush administration does too - they just don't want to tell anyone about it.)
