The Oil Road

by James Marriott

  Indeed, Mayis looks blissfully happy in a photograph Mika took in autumn 2005 in Turkey: pitch-forking hay in a meadow, smiling broadly, still smartly dressed. ‘These rich oil people don’t know what it’s like to work with your hands from six in the morning until ten at night. But I’m from a village, not from Baku. My manner is not of the city.’

  Mayis’s office is reminiscent of dissidents’ homes in 1980s Eastern Europe: the wooden floor, painted a deep brown, and covered with a mass-produced Persian rug; the walls lined with a grubby brown patterned wallpaper and, along one side, a large Formica dresser stacked two-deep with books in Russian, Azeri and English.

  ‘I feel for the refugees from the green fields of Nagorno-Karabakh who have been squatting in Binәgәdi for fifteen years. They are from the countryside, and now they are stuck in poverty and terrible conditions in this city.’ Mayis explains that in the early 1990s thousands of refugees from the war zone settled across Baku in uncompleted concrete structures and decaying tenements without walls. Many communities, still without connections to electricity or gas mains, run their own cables from local electricity substations to their rooms, and cook on electric heaters. Ever resourceful and recognising they are not one of the ruling elite’s priorities, the refugees have also constructed their own pipes to siphon sewage and refuse out of their ‘apartments’ and into the basements. Even when piped water was installed, the networks still often did not work, and many are forced to buy supplies from water trucks.22

  Despite government claims of a booming economy, Mayis insists that between 20 and 25 per cent of the population remain below the poverty line. ‘The government and state institutions point to growing GDP levels as an indicator of falling poverty. Yes, average income has increased, but so have prices.’ Overall, there has been no improvement in the real incomes or social welfare level of the population.23 The scarcity of jobs and resources also exacerbates tensions between the refugees and longer-term Baku residents.24

  Mayis explains how ‘cement trucks and architects came to Binәgәdi to build luxurious houses for the new rich. The refugees’ homes ruined their view, so the police began to evict people, but they resisted.’ Later, after our visit, when the authorities displaced more refugees to make way for a new underground station as part of the gentrification process, the refugees protested. They demonstrated outside the president’s Palace and fifty of them were taken away by the police in special buses.25

  Mayis leans forward on his desk and concludes, ‘But despite everything, people haven’t given up. The history of oil in Baku shows that things change. This city has been at the forefront of history before, inspiring people, so who says that won’t happen again?’

  SAHIL PARK, BAKU, AZERBAIJAN

  We have arrived here several months too late. In January 2009, the park in central Baku that we are standing in was a building site, as Baku City Authority workers demolished its stone and ceramic centrepiece, the ‘Memorial to the Twenty-Six Commissars’. The monument, with its eternal flame fuelled by a natural gas vent, had gained an iconic status in the Soviet Union: visited by foreign dignitaries and school classes, adorned with flowers by newlyweds. The corpses of the commissars, killed with the collusion of the British Army, had been reburied here six months after the city fell to the Red Army in 1920. The poet Vladimir Mayakovsky boldly wrote: ‘The blood of the twenty-six shall never cool – never!’

  Yet ‘never’ came to pass; as the USSR disintegrated the memorial was vandalised, and the flame snuffed out. Now, nineteen years after Azerbaijan declared independence, the monument has been broken up and the skeletons excavated amid a blizzard of contradictory reports. Azeri nationalists claimed that the remains of only twenty-two corpses were found, and that these bones showed that the commissars of Armenian descent were never present, including the leader of the Baku Commune: Stepan Shaumian.

  A week after the 1917 October Revolution in Petrograd, the Baku Commune seized power, led by Shaumian. The oilfields were quickly nationalised, for the Soviet was eager to put the vast resources controlled by the Nobels, Rothschilds and Shell, and by other oil barons, at the disposal of the worker’s state. It was the world’s first nationalisation of an oil industry.

  The Tsarist Empire, which had ruled Baku for over a century, had imploded, and everything was in flux. The Bolsheviks struggled to hold the city, but were perceived to be aligned with the Armenians and Christians against the Muslims and Azeris. After the Bolsheviks disarmed some Muslim cavalry troops returning to Baku on the ship Evelina in March 1918, a vicious conflict broke out in which thousands of Muslim civilians were killed by Bolshevik and Armenian forces.

  World War I was still raging, and the German and Ottoman empires were desperate to obtain Baku’s oil. Following the October Revolution, the Tsarist Front in Turkey collapsed, and the sultan’s Ottoman army advanced towards Baku. But the British were determined to stop the oil from reaching German hands, and themselves had designs on the Caspian oil industry. In London, the War Cabinet decided to deploy a British expeditionary force from Persia, in a seaborne attack on Baku. In the summer of 1918, British troops – known as ‘Dunsterforce’ after their commander Major General Lionel Dunsterville – briefly backed the anti-Soviet Centro-Caspian Dictatorship that had overthrown Shaumian’s Baku Soviet, and imprisoned the commissars.26

  It was now, with Baku under temporary British control, that the twenty-six commissars escaped from prison, taking a ship across the Caspian to Turkmenistan. But this region was also nominally under British control, and when the twenty-six were executed the Bolsheviks blamed the British. As Fitzroy Maclean reported while spying in 1938, ‘the Soviet authorities have never ceased to do everything they could to keep alive the memory of the Allied intervention, and while I was in Baku elaborate preparations were being made for the celebration of the twentieth anniversary of the death of the Twenty-six Commissars’.27 By the 1990s, generations of Baku children had learned about Britain’s imperial aggression in the region. Throughout the country, the martyred commissars were memorialised in statues, streets and the names of oilfields. But now Britain has returned, the ‘26 Commissars’ offshore field has been renamed ‘Azeri’, and the monument dismantled.

  We turn and walk through the streets of high buildings that echo Bucharest or Paris, thinking of the world before those chaotic years at the end of World War I – the world described in Ali and Nino:

  Outside the Old wall was the Outer Town, with wide streets, high houses, its people noisy and greedy for money. This Outer Town was built because of the oil that comes from our desert and brings riches. There were theatres, schools, hospitals, libraries, policemen and beautiful women with naked shoulders. If there was shooting in the Outer Town it was always about money.28

  James begins to tell a story of a set of photographs that he has seen, which left a strong impression on him. The images show a military parade in Tbilisi, Georgia, in February 1919. The marching troops must be the forces of the Menshevik Republic of Georgia, and there are soldiers among the crowd wearing British uniforms. The pictures were taken by his grandfather. In August 1917 Rowland Marriott signed up to fight in the army of the king and empire. He was the youngest of five brothers. Fred and Digby had already been killed at Ypres in France. Rowley never thought he would outlive the war.

  However, against expectations, he was not sent to the trenches of the Western Front, but to the relative calm of the southern Balkans. The night before the Allies’ ‘big push’, the Bulgarian Army mutinied, and the sky lit up as they detonated their ammunition dumps. A few days later, Ottoman and British forces signed an armistice. But the war was not entirely over. Rowley’s battalion was ordered to head east.

  Forty thousand troops steamed across the Black Sea to Batumi, and then boarded trains on the oil railway to Tbilisi. Rowley passed that winter, spring and summer in the Caucasus, before returning to his widowed and bereaved mother in Leicestershire. It is a military expedition almost forgotten in England, but our Georgia
n friends know it well. All that remains in James’s family are the photographs.

  It is likely that Rowley was in Tbilisi on 23 July 1919, when Lance Corporal Stell wrote to his own mother: ‘Dear Mother, hope this card finds you in the very best of good health as I am at present . . . We are cleaning and polishing all day long. We are not here to put down Bolshevism, but to guard British capital sunk in the oil fields.’29

  Minutes from ministerial meetings in Whitehall show that Lance Corporal Stell was right. The eastern committee of the War Cabinet was intent on securing the British military’s energy interests – after all, the Allies were seen as having floated to victory on a wave of oil.30 Notes from a meeting in December 1918 show Lord Curzon insisting: ‘The idea that the Azerbaijanis, the Armenians or the Bolsheviks could permanently hold Baku and control the vast resource there is one that cannot be entertained for a moment.’ Others in the committee suggested that Baku should be given to the French, but a paper by the General Staff declared: ‘From the military point of view it would be most undesirable for the approaches to India . . . which converge at Batum, to be placed at the disposal of an ambitious military power [France] which, although friendly to us at the moment, is our historical world rival.’31

  In a subsequent meeting, Foreign Secretary Arthur Balfour and Lord Curzon planned the future of the Caucasus:

  Mr Balfour: ‘Of course the Caucasus would be much better governed under our aegis than it would be under French aegis. But why should it not be mis-governed?’

  Lord Curzon: ‘That is the other alternative – let them cut each other’s throats.’

  Mr Balfour: ‘I’m in favour of that. We will only protect Batum, Baku, the railway between them and the pipeline.’32

  ISTIGLALIYYAT STREET, BAKU, AZERBAIJAN

  The traffic flows thick and fast along the dusty street of Istiglaliyyat – Independence – that arcs around the walls of the Old Town, past the Baki Soveti metro station. We are looking for the building that housed the parliament of the original Azerbaijani Democratic Republic in 1919. We have a black-and-white image of the interior showing men in dark suits, most with a moustache and fez, and a window. Precisely what the outside of the building looked like is hard to determine, but we know it is in this area.

  While the debates in Whitehall ebbed and flowed, things moved rapidly in the Caucasus. Less than three weeks after the Turkish Armistice, British troops under Major General William Thompson occupied Baku on 17 November 1918, four months after Dunsterforce retreated. Thompson proclaimed martial law and declared himself military governor. He privatised the oil and shipping industries that had been nationalised by the Baku Soviet and set up a labour control office, using his soldiers to break a general strike.

  Political authority was informally divided between the British command and the Musavat government of the Azerbaijani Democratic Republic, which espoused a secular Muslim, Azeri nationalist and socialist politics and introduced universal suffrage ten years before Britain. Yet, in reality, Baku was controlled by Britain, a country that neither recognised Azerbaijan’s independence nor was sympathetic to its claims.33

  When the parliament tried to open in December 1918, Thompson sent his soldiers to blockade the very building we are searching for. Britain continued to intervene in the shaping of the Azeri economy: when the Azeri government invited US corporation Standard Oil to pitch for a contract to control six months of oil shipments from Baku, Thompson intervened to derail the deal in favour of the British–Dutch company Royal Dutch Shell.

  Despite the limitations on their governing power, the Musavat leaders were supportive of the British military presence in Baku. For even as they took control over their capital in May 1918, the Azeri nationalists faced a diverse population of Russian, Armenian and Muslim workers, many of whom had undergone a long socialist education, participating in the strikes and struggles of 1904 and beyond. Bolshevism, with its role in past victories for workers’ rights, had deep roots in Baku. This meant that Musavat was never fully secure in the city, and relied on foreign powers – first the Ottomans and then the British – ‘to back them against the Reds’.34

  In London the fate of Azerbaijan was wrapped up in the wider debate over the British intervention against the Bolsheviks. The White Russian armies with which Britain was allied suffered repeated defeats and the intervention, coming so soon after the Great War, was unpopular in England. The discussion over the Caucasus was finally resolved, and in August 1919 British troops evacuated Baku, withdrawing up the railway line to Batumi. They left the Musavat government barely clinging to power for another eight months, before it capitulated to the Red Army’s invasion in April 1920.

  The oilfields were transferred back into public control, and the oil barons and bourgeoisie fled to İstanbul, Paris or Berlin – among them Lev Nussimbaum and his father. There was a revolutionary ecstasy of redistribution in Baku, with its vision of the downfall of the rich and the meek reclaiming what was theirs. From it was born the first permanently nationalised oil industry, and a state claiming to act in the name of the workers.

  With its vital strategic resource, its long radical history and its large industrial proletariat, Baku was extremely important in the early Soviet Union. The fifth anniversary of the October Revolution, on 7 November 1922, was celebrated in spectacular style. Arseny Avraamov’s Symphony of Factory Sirens was performed across the city, using the foghorns of the entire Soviet Caspian fleet, all the factory sirens of Baku, artillery guns, seaplanes, bus horns and a huge cast of choirs. Conductors stood on specially built towers signalling the different sound units with coloured flags and pistol shots. A ‘steam-whistle machine’ and enormous bands pounded out the ‘Internationale’ as noisy trucks raced across Baku for a gigantic sound finale.

  Shell, Standard Oil and the Anglo-Persian Oil Company were outraged to lose control over their investments in Baku. They tried a number of legal and political strategies to regain their expropriated assets but, despite a desperate need for foreign currency, the Soviet government held fast. The only concrete deals between the Soviets and the Western industry were similar to present-day ‘technical service contracts’ – agreements whereby private companies complete specific projects but do not gain control over the oil resources themselves. These kinds of deals were absolutely not what was desired by the major corporations, for whom ownership rights over oilfields were fundamental to their raison d’être.

  Following the interruptions of the war and revolution, the Oil Road was gradually re-established. The oil wells of Baku were repaired, a new Baku–Batumi pipeline was put into service and refined product was sold on to the world market so successfully that it could compete with Western corporations in their home countries. The Soviet marketing company sold £500,000 of fuel in Britain in 1924, and by 1929 it was selling eight times that amount. By May 1932, Basil Jackson of Anglo-Persian wrote that the market for oil in Europe ‘had during the past 12 months been taken away entirely from the American companies by the Russians and the Rumanians’.35

  The Soviet nationalisation of one of the key oil-producing regions in the world marked a paradigm shift in the industry. For the first time since mechanical wells had been drilled at Bibi Heybat and Pennsylvania, a substantial section of the oil industry was to be run not for private profit but for the benefit of the state. Not only was the political world divided in two, between socialism and capitalism, between a new East and a new West; so too was the oil industry, between one focused on generating income for private investors and another focused on generating income for the state.

  This division within the industry has outlived the division within political ideology. Whereas the number of self-proclaimed socialist states has dwindled since 1989, the percentage of global oil reserves in the hands of state companies has rapidly increased. Yet the person who led the first government to nationalise an oil industry, Stepan Shaumian, is now almost forgotten, even in his home city of Baku.

  NACAFQULU RAFIYEV STREET, BAKU,
AZERBAIJAN

  After looking for the 1918 parliamentary building, we catch a taxi and hurry across the city towards the former Black Town, past the terminal for ferries to Turkmenistan and along Nobel Prospekti. For we have a meeting with ‘the invisible father of the BTC pipeline’, and are keen to learn more about the motivations of Azerbaijan in offering its oil to Western companies in the early 1990s. There are some echoes in the negotiations between the Azeri government and Shell and of those with Standard Oil in 1919. Will events pre-dating the Soviet Union shed light on events following it?

  Sabit Bagirov led the State Oil Company of Azerbaijan, SOCAR, through the negotiations with the Western oil companies in 1992 and 1993, and now works for foreign corporations through his consultancy, the FAR Centre for Economic and Political Research. He has invited us to meet him in his office on the first floor of a shabby house on Nacafqulu Rafiyev Street. We find ourselves amid shelves piled high with neatly ordered books and files, cramming the corridor and several rooms.

  A secretary brings us tea as we sit round a table and listen to Sabit’s story. He tells us how negotiations began in 1989, when Azerbaijan was still part of the Soviet Union. Moscow felt more investment was needed to exploit the oil in the depths of the Caspian, and the foreign companies were eager – excited about perestroika, the developed local oil infrastructure and large offshore resources.

  Gorbachev’s waning power led inexorably to the official end of the USSR on 31 December 1991. Azerbaijan was by now independent, and the last head of the Azeri Communist Party, Ayas Mutalibov, had become its first independent president since 1920. Despite John Browne’s threat in June 1991 – ‘If we don’t have a deal in three months, we’re out of there’ – BP had stayed on. But negotiations were slow, and the battles between the oil corporations were ferocious. BP tried to woo officials with a trip to London, and in a visit to Baku by British Foreign Office minister Douglas Hogg in March 1992, the UK agreed to formal diplomatic relations. Rival companies tried similar tactics: Unocal took the Azeris to California and then Bangkok, where they were given ‘a couple of days to get their legs out from under them’ before seeing Unocal’s Thailand fields.36