A recent op-ed in the Observer notes the progress of Russia’s economic war against Turkey in the wake of the Turkish shoot-down of a Russia jet fighter. The short version is that Russia is inflicting significant pain on Turkey. Russia has slowed down the construction of nuclear power plants that Turkey is relying on to provide electricity. The Russians have also stopped importing Turkish fruits and vegetables, a $4 billion hit to Turkey’s export revenues. Russia has also curtailed travel to Turkey by its citizens.
All this may just be the opening shot in an economic campaign that could cripple Turkey as surely as a shooting war. The next step may be for Russia to reduce or even stop $20 billion worth of natural gas that it sells to Turkey every year. That would deprive Turkey’s electrical grid of the fuel it needs to run.
Turkey is already casting about for alternate sources of natural gas. Unfortunately, it has alienated every other country in the region which exports natural gas. Egypt is unfriendly because of Turkey’s support of the Muslim Brotherhood. Saudi Arabia and Israel are also miffed at Ankara because of past support for terrorist groups such as Hamas.
Maybe Turkey will be able to mend fences with other countries in the region and start developing alternate sources of natural gas. However, the situation that the Turks find themselves in represents a great opportunity for the United States should it decide to take it.
It turns out that the United States has become one of the biggest producers of natural gas in the world, thanks to the fracking boom. So much natural gas and oil has been produced, thanks to the new technology, that the prices for both have collapsed. The collapse in the price of oil and gas has resulted in a recession in the energy industry. Wells are being shut down, and tens of thousands of people are being laid off.
The export of liquefied natural gas was legal even before Congress lifted the ban on exporting oil recently as a result of the Omnibus Spending Bill. But, thus far, LNG exporters have had difficulty finding customers, thanks to a worldwide glut of fossil fuels.
Turkey and the United States could get together to solve a number of problems that afflict both countries by executing a deal to export LNG from the United States to Turkey, thus providing an alternate source of energy for Turkey.
This would lift the threat of Russia destroying Turkey’s economy at will. An LNG trade deal would also be an opportunity for the two countries to mend fences. Turkey has been reluctant to fully support the war against ISIS because a total defeat of that terrorist state would result in a victory for the Kurds. The Kurds are an ethnic minority who reside in Turkey, Syria, Iraq, and Iran, who are keen to establish their own independent state. Turkey has waged a decades-long war with the Kurds who live in its sovereign territory to stop them from doing so.
As part of the natural gas deal, Turkey might be persuaded to take a more active role in the war against ISIS, perhaps providing troops for a Muslim coalition to crush the Islamic State once and for all. The Turks might even be persuaded to go a little easier on the Kurds, granting them more autonomy, for example.
The American oil and gas industry will get a shot in the arm with access to a new market that could get some wells reopened and employees rehired. The United States would also serve notice to Vladimir Putin that if he tries using oil and gas as a weapon, say against Europe, America stands ready to fill in the gap. A potent weapon Russia can use in its own imperial adventures will be stricken from Moscow’s hands. America wins. Turkey wins. ISIS and Russia lose.