Condoleezza Rice has just made the first visit to Libya by a serving US secretary of state for more than a half a century. The last secretary of state to make the trip was John Foster Dulles in 1953, before Rice was born.

This remarkable turn of events seems to have taken the press by surprise. It was announced at a special briefing on Tuesday. Rice flew into Libya on Saturday with the reporters on board her plane still not knowing what her itinerary would be or what she planned to discuss with Libyan leader President Muammar el-Qaddafi.

Rice’s decision to include Libya in her three-day tour of North Africa, which also took in Algeria and Morocco, had something of an air of panic about it. US relations with Libya have been improving for the last five years. The US restored diplomatic relations with Libya in 2006. But meetings between the two countries have not previously taken place at such a high level. US special envoy to the Middle East William Burns is the highest ranking official to visit Libya recently.

Rice’s visit represents a definite shift in diplomatic pace. She described her visit as “a historic moment.”

Conscious that her visit might provoke criticisms in the US, Rice stressed that it “has come after a lot of difficulty, the suffering of many people that will never be forgotten or assuaged, a lot of Americans in particular. It is also the case that this comes out of a historic decision that Libya made to give up weapons of mass destruction and renounce terrorism.”

“Quite frankly, I never thought I would be visiting Libya, so it’s quite something,” Rice said.

But Qaddafi gave up his weapons of mass destruction programme in 2004 when he surrendered his stockpile of mustard gas and nerve gas precursors. UK Prime Minister Tony Blair made a personal visit to Libya only months later.

Since then presidents Nicolas Sarkozy of France and Silvio Berlusconi of Italy have made the journey to Libya. Qaddafi himself has visited France where he pitched his tent on the lawn of the Elysée Palace. Berlusconi has returned a classical statue looted from Libya when it was a colony of Italy and has promised to pay reparations for Italy’s imperial past.

Rice’s sudden decision to join the pilgrimage to Libya reflects two recent events that are closely related: the conflict in Georgia and the Libyan decision to sign a deal with the Italian power firm ENI and Gazprom, the Russian power company which is the world’s largest producer of natural gas.

Gazprom, which only recently opened an office in Libya, has offered to buy all Libya’s future oil and gas at market price. Libya is thought to have the fourth largest gas reserves in Africa.

ENI has agreed to share its gas assets in Libya. The two companies plan to increase the capacity of the existing pipeline that takes gas across the Mediterranean to Italy.

Europe currently gets a quarter of its gas supplies from North Africa and the Russian/Italian deal will give Russia a stake in this market as well as control over the gas supply from Russia itself.

Russia’s military operation in Georgia has demonstrated that it could easily cut the Baku-Tbilisi-Ceyhan pipeline, which is vital to European fuel supplies because it does not pass through Russian territory.

The US cannot allow Gazprom to gain a dominant position in Libya because it would undermine American hegemony in both Africa and Europe. Rice must be extremely concerned that Libya will become the jumping off point for a Russian intervention into the North African energy market. Morocco and Algeria are next in line for a Gazprom offer.

Gazprom’s bid to control North African energy is part of a wider Russian strategy. In another deal with ENI Russia has decided to build the new South Stream pipeline. It will rival the US-backed Nabucco pipeline that is intended to take gas from Turkey into Southern Europe. If Russia now succeeds in gaining control of a significant part of the North Africa gas supply it will have a near monopoly of European energy supplies and will exercise a far greater diplomatic weight in Europe.

North African resources played an important part in the build-up of tensions between the Great Powers that preceded World War I. Rice’s trip does not quite amount to an Agadir Incident but it demonstrates that international relations are fraught with the possibilities of conflict.

Qaddafi has been quick to take advantage of being courted by the Russian gas giant. He had been expected to meet Rice in his tent, but instead chose to meet her at his Azizia headquarters, which were bombed by the US in 1986.

President Ronald Reagan once referred to Qaddafi as the “mad dog” of the Middle East. Libya was on America’s list of terrorist states. The US shot down Libyan jets in the Gulf of Sirte and bombed Tripoli and Benghazi in 1986, killing 40 people including Qaddafi’s daughter. But Qaddafi’s conflict with America always had a conjunctural character.

Like other nationalist leaders around the world, Qaddafi was concerned to gain a greater share of his country’s oil wealth for the clique that supported him. Initially, some concessions were made to the mass of the population in the form of education and health care, but he suppressed all opposition ruthlessly.

Qaddafi was able to use the conflict between the US and the USSR during the Cold War to exercise some freedom of manoeuvre. He could play one side off against the other. But with the end of the Cold War he has found his way back into the US fold.

He seized the opportunity presented by 9/11 to offer his cooperation in the “war on terror” and backed the US invasion of Iraq. He agreed to pay compensation to the family of policewoman Yvonne Fletcher who was shot and killed outside the Libyan embassy in 1984. He handed over Libyan security agent Abdel Basset al-Megrahi to a special court in the Netherlands where he was found guilty of bombing Pan Am Flight 103 over Lockerbie in 1988. Finally, he agreed to give up his weapons of mass destruction and dismantled what he claimed was a nuclear programme.

For the US and Britain, Qaddafi’s change of heart offered a diplomatic lifeline. It could be claimed that the decision to invade Iraq had paid dividends and that a once pariah state and sponsor of international terrorism had been won over by the threat of military might.

But as the US and UK have faced a debacle in Iraq and Afghanistan, Qaddafi has realised that he retains some bargaining power. When a number of children were infected with HIV/AIDS in Libya’s crumbling health service, six foreign medical workers were sentenced to death and held for eight years. They were only released when the European Union agreed to pay €9.5 million to Benghazi Children’s Hospital and to compensate the families of the children. The total package is thought to amount to $460 million.

Europe’s need for energy and the attempt of the Russian oligarchs to corner the European energy market have given Qaddafi an unprecedented opportunity to increase his bargaining power with the US. What is clear is that he has no intention of returning to the old anti-American rhetoric.

Qaddafi once presented himself as the natural successor to President Nasser of Egypt and leader of the Arab world. But speaking on Al Jazeera television last year he said that he never went to Arab summits anymore because Rice was in charge. Far from US domination of the Middle East being a problem, he expressed his effusive admiration of the US secretary of state. “I support my darling black African woman,” he said. “I admire and am very proud of the way she leans back and gives orders to the Arab leaders.”

“Yes, Leezza, Leezza, Leezza,” He went on, “I love her very much. I admire her and I’m proud of her because she’s a black woman of African origin.”

Rice did not come away from Libya with everything she wanted. Qaddafi refused to release the 67-year-old dissident Fathi al-Jahmi. But this is very much a bargaining position. Al-Jahmi, who is currently in solitary confinement in Tripoli Medical Centre, is no doubt being weighed in the scales against US oil technology, investment and military hardware.

The greater bargaining power that Qaddafi has acquired does not mean that he is in any way independent of imperialism or can offer his own people or the mass of the African and Arab population an alternative perspective. All that he is concerned to do is achieve the best deal he can for Libyan gas and oil. The benefits of these deals will accrue to the elite around Qaddafi and his family. Ordinary working people will find that their living standards continue to deteriorate.

Qaddafi has made it clear that he intends to privatize the last vestiges of the welfare reforms that he introduced when he came to power. Electricity and telephone services are to be privatized. Health and education will follow.

“The money that we put in the education budget, I say let the Libyan people take it,” Qaddafi said recently. “Put it in your pockets and teach your kids as you wish, you take responsibility,” meaning that they will have to pay for education in future.

Individual Libyans will be able to enter into joint partnerships with foreign companies. This is a recipe for stripping the assets of the nationalized companies. Qaddafi is following the pattern set by other nationalist regimes that have opened up their markets to international capital. The end result has been to drive the majority of the population into ever deeper poverty and to enrich the tiny elite who hold power to an even greater extent than was possible before.