Can past tenses in a sentence have different time reference?

Duric Ludokian was a huge wealthy Armenian who had fled from his native country to Russia in 1896 shortly after the first Turkish massacres and pogroms against the Armenian people had begun. He had fled (1) again in 1918 after the Russian Revolution and was (2) among the first of the thousands of Russian émigrés who found (3) sanctuary in Berlin. Ludokian had made his fortune in nuts. He described himself as a ‘nut importer’.

(William Boyd’s The New Confessions - from English Grammar (by Downing), p367)

Which one of the following is right?

I.
(2) and (3)'s event times precede speech time. (1) precedes both (2) and (3). ((2) = (3))

II.
Though (3)‘s event time may precede (2)’s event time, it adopts past simple for denoting that it happened after (1).

Answer

None of the events described occurs in Speech Time, which is the time when the author writes and you read. Speech Time is expressed with simple present and present perfect constructions, or their progressive variants, and there are none of those here.

Reference Time is the time in which the narrative is set, and the contrast between simple pasts and past perfects distinguishes events which lie at Reference Time and events which lie before Reference Time.

Duric Ludokian was [at RT] a huge wealthy Armenian who had fled [before RT] from his native country to Russia in 1896, shortly after the first Turkish massacres and pogroms against the Armenian people had begun [before RT]. He had fled [before RT] again in 1918 after the Russian Revolution and was [at RT] among the first of the thousands of Russian émigrés who found [at RT] sanctuary in Berlin. Ludokian had made [before RT] his fortune in nuts. He described himself [at RT] as a ‘nut importer’.

There is a little muddiness in the description of the events immediately after the second flight; but that itself points to RT lying very shortly after 1918—let us say 1919 or 1920.

I think the muddiness comes about because for the author RT is not just a specific point in time but a specific "scene": the postwar Russian émigré community in Berlin. Whatever occurs there is in simple past, the time in which the narrative is set; whatever leads up to that is in past perfect. Ludokian had been an entrepreneur in Russia, but he was now an émigré, one of the first of those.

Your option I is correct.