Markey Conjurs Up Cold War Fears

Todd Shriber
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BP's recently announced $16 billion share swap with OAO Rosneft, the Russian state-run oil giant, has delivered all the controversy market observers have become accustomed to with BP in the past year. Good grief, one would think that since BP's reputation in the U.S., one of, if not the company's most important market, is still in dire need of repair smarter things could have been done than getting cozy with a Russian firm.

Reputation in the U.S. be damned because this is just the state of affairs in the oil business. It's getting ever harder to find worthwhile reserves, but that's exactly what BP is (probably) going to get its hands on by partnering with Rosneft to explore in Russia's slice of the Arctic Circle. For $7.8 billion and 5% of the company, BP (BP) will have essentially replaced all the reserves it sold through its asset sales plan to raise cash for the Gulf of Mexico half the cost, according to Bloomberg News.

No one has to like this deal and it is doubtful BP much cares if anyone does, but that did not stop one congressman from issuing some choice words that seem to be a play on cold war fears. Rep. Edward Markey (D-Mass.) referred to BP as ''Bolshoi Petroleum'' in a statement issued by his office last week following news of the BP-Rosneft deal.

Two things can be assumed by the jab, but only one can be true. Either Markey was just looking to have some fun at BP's expense and does not know Russian very well because ''bolshoi'' means large or grand and BP is in fact quite large. Or he is hoping to exploit some old ''the Russians are coming'' cold war fears to drum up opposition to the deal.

It is probably safe to lean with the latter scenario because Markey has called for the Treasury Department to investigate the deal and the reality is, Markey is no fan of BP. In May, he told NPR that BP ''can't be trusted.'' In a June interview on Meet The Press he said BP management was ''either lying or grossly incompetent'' following the Gulf spill. In August, he used the phrase ''carpet bombed'' for how BP used chemical dispersants to breakup oil in the Gulf.

I am not old enough to remember the days when school children were forced to hide under their desks during those nuclear threat drills. My parents told me about them and I saw them in movies, but I am old enough to remember President Reagan telling Mikhail Gorbachev to ''tear down this wall'' and I remember that wall falling.

With all that, I am of the mind that U.S./Russia relations will be cool probably for the rest of my lifetime, but tacky comments using Russian words do not help matters. Either there are legitimate national security issues for the U.S. in BP's tryst with Rosneft or there are not. If there are, they need to be identified and dealt with accordingly.

Either way, there are no potshots that will keep BP out of the Arctic. Not while there is oil to be had and money to be made.