Transit Troubles: Pipelines as a Source of Conflict

April 16, 2009 | 00:00

Transit Troubles: Pipelines as a Source of Conflict

Any reading of the history of transit oil and gas pipelines suggests a tendency to produce conflict and disagreement, often resulting in the cessation of throughput, sometimes for a short period and sometimes for longer. It is tempting to attribute this to bad political relations between neighbours. This is certainly part of the story, but also important is the nature of the 'transit terms' - tariffs and offtake terms - whereby transit countries are rewarded for allowing transit. Put simply, the trouble with transit pipelines has a significant economic basis.

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