Leading article: Dependence on Russian energy places Europe at risk

The EU must ensure that no one can hold it to ransom in future

Share
Related Topics

The angry stand-off between Russia and Ukraine over gas is now seriously disrupting supplies to several European Union countries. Romania has lost 75 per cent of its supply; Bulgaria has only a few days' gas left; Slovakia is on the verge of declaring a state of emergency. The European Commission has waded in with indignant condemnation. But what may look like a replay of what happened three years ago, when Russia drew international condemnation for shutting off gas supplies to Ukraine is in many ways very different; 2009 is not 2006.

For a start, the political element is less evident, and not only because Russia and its state-controlled energy conglomerate, Gazprom, have been more adept in their public relations. This is more of a commercial row between energy companies over payments. Gazprom is demanding money it says it is owed by the Ukrainian state energy company, Naftogaz. Ukraine says it has paid. But the actual sum remains in contention, as does the price of future supplies. Gazprom stopped supplying gas to Ukraine on New Year's Day.

Falling world energy prices make for another distinction between 2009 and 2006. Three years ago, Russia was a major beneficiary of high oil and gas prices, which strengthened the rouble and enabled it to build up a massive budget surplus. The global credit crunch has reversed the process. Commercial self-interest dictates that Gazprom is no longer in a position to grant favours to Ukraine, even in the unlikely event that it wanted to. It needs the money. And Ukraine, as an independent country, will eventually have to pay market prices for Russian energy, like most of Gazprom's other customers.

The international mood has also changed. Internal rivalries have weakened successive Ukrainian governments and the goodwill generated by the Orange revolution is fading. Gazprom may be a difficult negotiating partner, but by obstructing the flow of gas through transit pipelines, Ukraine is holding both the Russian company and Gazprom's other customers to ransom.

Maybe it hopes that a panicked EU will somehow ride to its rescue, perhaps by interceding on its behalf with Gazprom. Given that its battered economy desperately needs the pipeline transit fees, however, its further logic is unclear.

If the rights and wrongs of the dispute look more complicated three years on, however, the lessons to be learnt by Europe's energy-importing countries are, depressingly, the same. Much of the European Union is vulnerable in the energy department. Sources of energy must be diversified - and soon.

While most West European countries and Turkey can resort to pipelines that do not cross Ukraine, many former Soviet-bloc countries are trapped. New pipelines – North Stream under the Baltic, and South Stream under the Black Sea – are under construction, but they will still leave much of Europe vulnerable to the capacity, and caprice, of one supplier: Russia. The security of the Nabucco pipeline, that would bypass Russia through Georgia, was called into question by the past summer's war.

Although not directly affected by the present dispute, Britain must also come to terms with becoming an energy importer again, curb demand and increase storage capacity. Most immediately, however, what is needed is a neutral disputes procedure capable of settling the differences between Russia and Ukraine. Without this, the EU could be contemplating the cycle of intimidation and cut-offs all over again.

React Now

Latest stories from i100
iJobs Job Widget
iJobs General

Recruitment Genius: Business Development Manager / Sales - OTE £45,000

£35000 - £45000 per annum: Recruitment Genius: This company is a solutions / s...

Recruitment Genius: Sales Executive - OTE £45,000

£18000 - £45000 per annum: Recruitment Genius: A Sales Executive is required t...

Recruitment Genius: Test Development Engineer

£35000 - £40000 per annum: Recruitment Genius: Are you inspired to bring new a...

Recruitment Genius: Trainee Motor Engineer

£14000 - £18000 per annum: Recruitment Genius: This is an exciting opportunity...

Day In a Page

Read Next
Kennedy campaign for the Lib Dems earlier this year in Bearsden  

Charles Kennedy: A brilliant man whose talents were badly needed

Baroness Williams
Nick Clegg (R) Liberal Democrat Leader and former leader Charles Kennedy MP, joined the general election campaign trail on April 8, 2010  

Charles Kennedy: The only mainstream political leader who spoke sense

Tim Farron
Sepp Blatter resignation: The beginning of Fifa's long road to reform?

Does Blatter's departure mean Fifa will automatically clean up its act?

Don't bet on it, says Tom Peck
Charles Kennedy: The baby of the House who grew into a Lib Dem giant

The baby of the House who grew into a Lib Dem giant

Charles Kennedy was consistently a man of the centre-left, dedicated to social justice, but was also a champion of liberty and an opponent of the nanny-state, says Baroness Williams
Syria civil war: The harrowing testament of a five-year-old victim of this endless conflict

The harrowing testament of a five-year-old victim of Syria's endless civil war

Sahar Qanbar lost her mother and brother as civilians and government soldiers fought side by side after being surrounded by brutal Islamist fighters. Robert Fisk visited her
The future of songwriting: How streaming is changing everything we know about making music

The future of songwriting

How streaming is changing everything we know about making music
William Shemin and Henry Johnson: Jewish and black soldiers receive World War I Medal of Honor amid claims of discrimination

Recognition at long last

Jewish and black soldiers who fought in WWI finally receive medals after claims of discrimination
Beating obesity: The new pacemaker which helps over-eaters

Beating obesity

The new pacemaker which helps over-eaters
9 best women's festival waterproofs

Ready for rain: 9 best women's festival waterproofs

These are the macs to keep your denim dry and your hair frizz-free(ish)
Cycling World Hour Record: Nervous Sir Bradley Wiggins ready for pain as he prepares to go distance

Wiggins worried

Nervous Sir Bradley ready for pain as he prepares to attempt cycling's World Hour Record
Liverpool close in on Milner signing

Liverpool close in on Milner signing

Reds baulk at Christian Benteke £32.5m release clause
On your feet! Spending at least two hours a day standing reduces the risk of heart attacks, cancer and diabetes, according to new research

On your feet!

Spending half the day standing 'reduces risk of heart attacks and cancer'
With scores of surgeries closing, what hope is there for the David Cameron's promise of 5,000 more GPs and a 24/7 NHS?

The big NHS question

Why are there so few new GPs when so many want to study medicine?
Big knickers are back: Thongs ain't what they used to be

Thongs ain't what they used to be

Big knickers are back
Thurston Moore interview

Thurston Moore interview

On living in London, Sonic Youth and musical memoirs
In full bloom

In full bloom

Floral print womenswear
From leading man to Elephant Man, Bradley Cooper is terrific

From leading man to Elephant Man

Bradley Cooper is terrific