|August 3, 2017
In the fourth century B.C., Aristotle used evidence and reason to argue that the world was a sphere. More than a millennium later, explorers like Christopher Columbus set sail on the assumption that Aristotle and other Greeks from his time were right, and that the distance involved would not prohibit travel from Europe to India. The New World was discovered and the slow decline of the European epoch began. Yet humanity, despite all its technological and scientific innovation, still has not been able to interact with the Earth as if it were a simple sphere. The North and South poles are covered in ice, and for most of human history, traversing these harsh geographies was an impossibility.
Today we know that some basic facts of the Earth are changing, and that its limitations on human travel are being eliminated. It won’t be the seamless process some have made it out to be, but over the course of the next century, as ice in the Arctic melts, humans will be less constrained in their ability to travel through the North. Maritime trade routes that traverse the Arctic Ocean are already being used and will be used more frequently. Some of these routes can reduce the distance between countries in Northwestern Europe and Asia by almost 40 percent, or between East Coast U.S. ports and Asian ports by almost 20 percent. This will improve the bottom line of many companies as well as trade-oriented nations and will reshape global trade patterns. It may even attract new population centers to the Arctic coast, especially if the promise of national resource wealth in the Arctic is even half as extensive as advertised.
There are precedents for the opening of new trade routes changing global geopolitics. When European powers found a way around the Mediterranean and the Ottoman Empire’s grip over its trade routes, it set in motion a reordering of the balance of power across the world. The construction of the Panama Canal was an integral part of the rise of a global hegemon in North America, because it meant the U.S. could move its naval forces from the Atlantic to the Pacific at will.
The opening of the Arctic – a process that will take at least multiple decades, if not until the end of the century – should not be thought of in this same vein. There will no doubt be ramifications of geopolitical import, but most of those ramifications will alter current geopolitical realities rather than create new ones. This piece, therefore, will attempt to accomplish two goals. First, it will integrate the Arctic region into GPF’s model of the world. In so doing, it will define the balance of power in the Arctic and how Arctic nations interact with the rest of the world. Second, it will give a preliminary and balanced account of the ways in which developments in the Arctic will change the world, while carefully avoiding the slip into hyperbole that has afflicted much of the analysis of this part of the world in recent years.
Integrating the Arctic Into Theories of Geopolitics
The Arctic Ocean is the world’s smallest and shallowest ocean. Water covers almost 71 percent of the Earth’s surface; the Arctic Ocean makes up just 3.9 percent of that total. The Pacific is the world’s largest ocean by far, with an area of over 60 million square miles (160 million square kilometers). The area of the Arctic Ocean is not even a tenth of that size.
It’s not just that the Arctic is small. No other ocean in the world is surrounded by landmasses the way the Arctic is. The distance between the U.S. and Japan across the Pacific Ocean is roughly 4,000 miles. The distance between the U.S. and continental Europe is roughly 3,600 miles. By comparison, the Arctic countries are right on top of each other. For example, the U.S. and Russia sit roughly 60 miles apart from each other at the Bering Strait. The International Hydrographic Organization may well classify the Arctic as an ocean, but in geopolitical terms, it has little in common with the world’s major oceans.
The closest analogue in the world for thinking about the geopolitics of the Arctic is not its fellow oceans, but another large body of water surrounded by countries of different continents: the Mediterranean Sea. This comparison isn’t perfect: The Arctic Ocean is about five times as large as the Mediterranean Sea, and the center of the Mediterranean is not a hunk of impassable ice. Many Mediterranean countries also share land borders, and there are much fewer of them to start with. Despite the deficiencies, the comparison gives us a more realistic picture of the Arctic. More important, it helps define the Arctic not as a moat separating vast continents but as a potential seascape over which the region’s strongest powers may eventually compete.
The Mediterranean has been a center of global conflict for millennia, while the Arctic has been exceptional for the adverse. This will remain the case for decades to come but not indefinitely. There is a scientific consensus that the current rate of melting will mean that some of the Arctic’s maritime routes will be open during the summer by the 2030s. But even if these projections are correct, it will only be if the Arctic Ocean becomes traversable at most, if not all, times of the year that we can expect to see conflict there. The more ice that melts, the more apt the comparison to the Mediterranean becomes, and the history of competition between Mediterranean powers is bloody.
Even so, there is another way in which the comparison to the Mediterranean helps conceptualize the Arctic’s geopolitical position in the world. The authors of the three most influential theories of global geopolitics in the 20th century were Alfred Thayer Mahan, Halford Mackinder and Nicholas Spykman. These three thinkers had profoundly different ideas about the main source of global power in the international system. Mahan’s focus was on sea power; he believed that whichever country controlled the world’s oceans would in turn dominate global power. Mackinder developed a different thesis based on control of the heartland, which he defined as much of the land that would end up being controlled by the Soviet Union after World War II. Spykman came after Mahan and Mackinder, and though his views were more akin to those of Mackinder, he significantly modified the heartland theory. Spykman posited that what he called the “rimland” was the real key to global power. It was the areas surrounding the “heartland” – places that also had access to the sea – that were most important in understanding geopolitics.
Despite the conceptual differences in these theories, all three have one thing in common: They did not consider the potential importance of the Arctic Ocean. This omission makes more sense for Mahan, who passed away in 1914, well before the potential of the Arctic Ocean as a viable maritime trade route was understood. But Spykman lived until 1943 and Mackinder until 1947. They lived through a time when the Allies sent Russia supplies and munitions to fight off the Central Powers via the Barents Sea. In 1917, Britain, France and the U.S. shipped 2.5 million tons of cargo to Russia along this route. In 1932, a Soviet ice breaker made the first ever transit of the Northern Sea Route in the Arctic in one season, and U.S. media were entranced with the Arctic’s potential.
Broadly speaking, it was Mahan whose theory proved most successful in predicting what was to come. The Cold War set up a battle royal between a heartland power and a sea power, and the United States emerged not only victorious but also as the only global hegemon in history to control the world’s most important oceans. As the map above shows, for Mahan’s purposes the Mediterranean was not one of those oceans. The importance of sea power was the way it could isolate a potential power in the heartland or the rimland. As we will explore in the next section, this is the appropriate way to think about the importance – or lack thereof – of the potential opening of Arctic trade routes. For these fathers of 20th-century geopolitics, the Arctic was inaccessible. For 21st-century students of geopolitics, we might simply say that the Arctic Ocean is containable.
Balance of Power in the Arctic
With the theoretical construct laid out, the next step is to look at a map.
There are a few definitions of what constitutes the Arctic, so we must begin by defining what it is. One potential definition comes from the Arctic Council, which is made up of eight countries, all of which hold territory above the Arctic Circle (66 degrees, 32 minutes north latitude). But not all of these countries are Arctic littoral states. Only five main countries border the Arctic Ocean: the U.S., Canada, Denmark (via Greenland), Norway and Russia. Some consider Iceland a littoral Arctic country as well, and for the purposes of this article, its inclusion is reasonable. So when GPF writes about the Arctic region, we are talking about the six countries that border the Arctic Ocean, as well as the seascape itself.
Russia and Canada are the most important countries in the Arctic. Russia holds the most Arctic territory by far. Accounting for the 200-nautical-mile limit that the U.N. Convention on the Law of the Sea grants Russia the right to claim, Russia occupies approximately 40 percent of the Arctic’s territory. More important, the two major sea routes that permit ships to traverse the Arctic run along the Russian and Canadian coasts: the Northern Sea Route and the Northwest Passage. The Northern Sea Route is a more reliable maritime trade route than the Northwest Passage, which the Arctic Institute noted last year was impossible to traverse even at the peak of summer because of ice conditions. Russia and Canada also have the largest naval fleets equipped to deal with the Arctic’s harsh climate. Russia has over 40 icebreakers in its fleet, while Canada has 15. By comparison, the United States has only two functional ice breakers, and though it could build more, it would take 5-10 years.
It is tempting to say that Russia already dominates the Arctic – that its power there exceeds even that of the United States. Certainly, thinking like that is part of the reason for the sensationalist reporting about Russia’s military modernization campaigns and its increased deployment of military assets in its territory in the region. It is true both that Russia is seeking to modernize its military forces and that it has dispatched forces in greater numbers to the Arctic, though the size and abilities of those forces still pale in comparison to what Russia had stationed in the area during the Cold War. More important, however, this type of view of Russian behavior in the Arctic misreads the geopolitical reality of the situation. The West tends to view the Arctic as a potential source of Russian strength; in reality, it is more of a Russian vulnerability.
The map at the beginning of this section shows the Arctic region from above. What immediately jumps out is that Russia’s vast holdings of territory in the Arctic do not help it deal with one of its fundamental strategic weaknesses: its lack of access to the world’s oceans. Russia cannot exit the Arctic to get to the Pacific without passing the Chukchi Sea and the Bering Strait, both of which are off the coast of Alaska. The U.S. may not have many ice breakers, but the rest of its navy is without peer and could easily shut down this shipping lane if it deemed it in its national interest to do so. To exit the Arctic Ocean to the Atlantic, Russia would have to traverse the waters between Iceland and Greenland, or between Iceland and the United Kingdom. These are larger openings than the Bering Strait by far – about 200 and 500 miles, respectively – but they are still eminently susceptible to a blockade from anti-Russian forces.
Russia’s position in the Arctic, then, is something of a trap. If the U.S. so chose, it could block traffic coming into and out of the Arctic, and there is little Russia could do to retaliate. Furthermore, increased accessibility to the Arctic opens the Russian heartland to a vulnerability it has never had to face before. The core of Russian strategy in Europe has been to establish buffer zones between Moscow and the North European Plain. This strategy is based in part on the idea that Russia has not had to worry about a potential threat to its long Arctic coastline, the Arctic being impossible for its enemies to traverse. If Arctic ice melts enough to allow trade in the Arctic Ocean year-round, that also means that enemy naval forces would have more room to operate. This explains why Russia has assumed such a defensive posture in the region.
It also explains why Russia has, from a diplomatic perspective, been relatively cooperative in the region. The United States is the only country among the Arctic nations that has not signed on to the U.N. Convention on the Law of the Sea, which provides a legal framework for how much maritime territory a country can claim. The U.S. has a long history of avoiding the strings attached to multilateral treaties and institutions. On the one hand, the U.S. wants freedom of navigation in global trade routes and provides that security with its navy. On the other hand, the U.S. does not want to open its own forces to potential retaliation by international bureaucracies.
Its aversion to international agreements doesn’t mean the U.S. is an aggressive player in the Arctic. By and large, Arctic nations have exhibited an exceptional level of cooperation and willingness to compromise in settling disputes. This makes some sense because the value of the Arctic is not in holding strategic territory so much as it is in establishing viable maritime trade routes, with the attendant economic benefits that come to countries located in key chokepoints. Another value of the Arctic is its vast resource potential, and conflict only prevents that kind of development from taking place. Finally, there is no country for which control of the entire Arctic region is a part of the national ethos. The relative uninhabitability of the region plays at least a small part in why disagreements have thus far been consigned to negotiations and to courts.
Russia is the largest power in the Arctic, but it cannot control the Arctic and does not seek to. Canada, Norway and Denmark/Greenland all have significant interests in the region, but none of these interests would be advanced by military conflict. As for the U.S., which has claims to the Arctic by virtue of Alaska, its main interest is in making sure that any maritime trade routes that are opened as a result of technological innovation or climate change have the same status as maritime trade routes in the rest of the world. The U.S. cannot dictate what happens in the Arctic, but it doesn’t need to. The U.S. and its allies can control what goes in and out, effectively undermining any Russian advantage in terms of territory or available ice breakers.
This piece takes a necessarily high-altitude view of developments in the Arctic. Still, before concluding, it is worth also laying out some of the potential opportunities within the Arctic as well as its limitations. The potential benefits lie mainly in two areas: reducing the distance required on certain key trade routes, and developing oil and gas in the region.
Let’s begin with the issue of distance. It is true that there are many trade routes that the Arctic could shorten. The important thing to keep in mind, however, is that distance is not the only factor in determining cost. The cost of fuel and the cost of outfitting ships to survive in the Arctic’s harsh climate also affect the bottom line.
In 2013, when oil prices were still high (Brent crude prices were around $108 per barrel for the year), 71 ships used the Northern Sea Route, carrying a total of 1.35 million metric tons of cargo. Last year, when Brent crude prices averaged around $46 for the year, only 19 ships used the route, with a decrease in cargo volume of 84.1 percent. Unless prices unexpectedly jump significantly, the economics of using Arctic maritime trade routes even if the ice is melting won’t be justified.
In addition, outfitting ships for the Arctic is costly, and the modifications needed to operate in the Arctic and in some of the narrower chokepoints in the region limit the size of ships. For instance, just to get permission to enter the Northern Sea Route, a ship must be equipped with a reinforced double hull and meet several technical requirements, as per the Arctic Institute. Also affecting the bottom line is that the capacity of ships operating in the Arctic is no more than a third the size of ships that can operate in open water. Even by 2035, the Arctic Institute projects that the economics of ice-reinforced vessels will still make it cheaper to use traditional shipping routes.
A 2016 study by the Arctic Institute looked at this issue in detail and concluded that “sea ice will continue to be an integral part of the Arctic Ocean for decades to come and the shipping lanes will be covered in ice throughout most of the year.” Even with Arctic ice continuing to melt, there is the problem of the variability of ice conditions, which remain unpredictable at best. One of the most important elements in the shipping industry is time scheduling, and the Arctic’s waters pose fundamental problems in attempting to run any kind of normal shipping schedule.
The other major potential benefit of the Arctic lies in its vast potential energy resources. The emphasis, however, is on the word “potential.” A U.S. Geological Survey report released in 2008 is the source of every optimistic data point for potential natural resources in the Arctic. That report suggested that the Arctic held about 10 percent of the world’s existing conventional resources, or 240 billion proven barrels of oil and oil equivalent natural gas. In addition, the study estimated that the Arctic could contain 90 billion barrels of undiscovered oil, 17 trillion cubic feet of undiscovered gas and 44 billion barrels of natural gas liquids, making up 13 percent, 30 percent and 20 percent of the world’s undiscovered hydrocarbon resources, respectively.
Of course, that report was mainly focused on estimates and was written at a time when today’s low oil prices were unthinkable to most. As recently as 2013, oil prices were averaging above $100 a barrel. That is an important benchmark. The Arctic Institute reports that the break-even price for oil on many projects in the Arctic region is about $100 a barrel. Russia in particular has been banking on oil to support its economy and was expecting higher oil prices to last. But the shale revolution in the U.S., the oversupply of the market and the consequent reduction in oil prices have not only decreased the financial incentive for shipping companies to use the Arctic trading routes, but they have also made developing many of the energy resources available in the Arctic a less attractive prospect. This is not a permanent state of affairs; new technology could significantly lower the cost of production in the Arctic, for example. But in the short to medium term, GPF does not expect higher oil prices, and that limits the efficacy of natural resource extraction in the Arctic even if some of the estimates from the USGS on proven reserves are accurate.
Future analyses will delve into some of these issues with more depth. For now, the important takeaway is that Arctic trade routes can reduce distance, but that does not mean they are economical to use, and most estimates of ice melting and the cost benefits of shipping via the Arctic don’t envision a scenario in which the Arctic is a feasible or logical trading route in the next two decades at least. As for the Arctic’s oil and gas reserves, they are doubtless formidable in their size, but they are also expensive to access. The combination of low oil prices and a glut in the market make them irrelevant in the near term.
The Arctic region is changing. These changes have the potential to alter global trade routes and may lead to increased competition in the region, and there is no reason to expect that competition to be entirely nonviolent. Moreover, it will take a century or more – not decades – for these developments to occur. Even if projections on ice melting in the Arctic are too conservative and the region’s maritime trade routes open themselves up to greater degrees of trade, the geography of the Arctic Ocean is such that it will not have a transformative effect on global geopolitics. The Arctic Ocean is a less consequential version of the Mediterranean Sea, and access to it can be controlled by the United States. Understanding developments in the Arctic requires recognizing what is changing and what isn’t.