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40 comments on The European situation is not really stable

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alan on January 8, 2006 - 9:39pm Permalink | Subthread | Comments top
Now that the situation with Ukraine is settled they are moving on to Bulgaria.
Bulgaria in Russia gas supply row

Bulgaria says it has become embroiled in a tussle with Russia over the price it pays for its gas imports.
Energy minister Rumen Ovcharov said Bulgaria was refusing demands to change its gas supply contracts with Russian state-run energy firm Gazprom.
"The Russian side demanded that we renegotiate the scheme of payment for transiting Russian gas through Bulgaria to Turkey, Greece and Macedonia," Mr Ovcharov told Bulgaria's bTV television.
"We will answer that this offer is unacceptable," Mr Ovcharov said. "There are no review possibility clauses in our contract signed in 1998 to run until 2010."

http://news.bbc.co.uk/2/hi/business/4587598.stm

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Agric on January 8, 2006 - 10:27pm Permalink | Subthread | Parent | Comments top
Yes, I was amused by the Bulgarian development, too. Will be interesting to see how it develops and what that tells us of the meaning of 'law' in Russia etc, still a bit of a vague concept I would say. I doubt it has anything to do with recent steps in bulgaria joining the EU ;)

On the wider topic (European situation) I think this is positive. I have no doubt that EU countries and the Commission will now be looking to security of energy supplies, and that that will lead them to some pretty inevitable conclusions. They will, relatively soon in their context, say that PO is here or nearing and begin to formulate structures and policies to deal with it. Events may overtake those ponderous processes, however.

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geewiz on January 8, 2006 - 11:36pm Permalink | Subthread | Parent | Comments top
Agric, i tend to think that the UK will be the first to stand up and say to the people: we have a problem.   Malcolm Wicks MP on 19Dec05 has made an Energy Review... of UK challenges, he also mentions that:

But things have changed since we set out our energy policies in 2003.

Our own gas output has declined faster than anticipated and we have moved to being a net gas importer - earlier than envisaged.

We will rely on gas imports for both heating and electricity supply. Significantly by 2020 we may be importing over 80% of our annual gas requirements ? last year it was around 10%. These are likely to be sourced from a variety of countries, most of them developing and OPEC countries although Norway will play a key role. Russia will be a substantial provider to the EU, including the UK.

It reads like any companys annual report, (without the finances) but says: basically we have some good news, and oh yeah, we have some bad news.

source right here

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Twilight on January 9, 2006 - 3:30pm Permalink | Subthread | Parent | Comments top
Your comments on the rule of law in Russia are probably appropriate for laws within the country, but in terms of foreign policy there are no laws.  There is only a hegemonic system created by the western powers, and the pretense of law.  The Russians problem is mostly that they lack subtlety, but then the US can hardly be called subtle of late either.  I think the EU is the only ones clinging to that "quaint" notion.  The resource is in Russian territory, and they can use it as they see fit, and we have to deal with it because we don't have that much leverage over them.  It's something we're not used to, but we're going to be learning a lot more about it.  We can only take the energy of those who can be overcome by our militaries, and even then we can be stopped if they align with one of the other powers.  

So the world will be carved up into competing empires of large economic & military powers associated with major energy producers.  And it is not clear the US and/or the EU will be the big dogs.  Russia may in fact be in an excellent position.  It may put a lot of strain on the EU, as different members might make different choices about who they align with.  

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Agric on January 14, 2006 - 10:02pm Permalink | Subthread | Parent | Comments top
I guess you are saying: welcome back the 'Great Game', Twilight, though perhaps the truth is it never ended, was just taking a time out.

The stacks held by the players have changed since we last looked, the US stack looks lower, Russian and Chinese higher. The US player has been gambling a bit much lately while the others have been more cautious, biding time, accumulating.

Sometimes weakness is strength: the EU is no threat, it would not (of its own volition) attack foreign nations, so is worth preserving as a market.

For Russia and China there is one clear enemy: USA. One might think they could be mutual enemies but they know they can achieve mutually acceptable compromises while they feel that the US will always try to exploit and subjugate them, as it has all others these last 100 years.

Ultimately the US empire of exploitation, manipulation and economic dominance will fall. For certain within 20 years, probably within 10 years. The question is how it falls, with grace or in a bloody thrash.

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BaSE on January 9, 2006 - 4:43am Permalink | Subthread | Parent | Comments top
Does this mean that Russia is having difficulties meeting its committments?  They certainly know the terms of their agreements.  Is there some underlying problem that is not being addressed?
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AlexC on January 9, 2006 - 2:53pm Permalink | Subthread | Parent | Comments top
I dont think supply is an issue for Russia (largest gas reserves in the world). What we are seeing is Russia flexing her muscles, Russia's power will only grow given time. If anything good comes out of this it might help move the EU faster towards green and sustainable policy (Which i have hope will really begin to gather pace soon).

Also bare in mind Russia is essentially a European country and Europe is its largest and richest customer. Russia might be behaving badly but it knows where its home really is. I would much rather have a large producer like Russia behaving a little badly but sitting on my backdoor when PO hits. Than be in the US which has fair less options when it comes to gas.

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LevinK on January 10, 2006 - 4:32pm Permalink | Subthread | Parent | Comments top
This was more a psychological move by the Russians not a real attempt to exercise pressure. They are preparing the ground for negotiating better terms for them when our current agreement with GazProm expires in 2008 if I recall correctly. Russia used the momentum of their victory in Ukraine and of course this was quickly presented as another example of how the bad Russian bear blackmails European countries via energy. For the naive free-market believers this can sell, but here in TOD I think we should be viewing the things at a slightly deeper level. Energy has always been in the center of the great blackmailing/influence game called politics. There are not good and bad guys here, there are just weak and strong ones.
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40 comments on The European situation is not really stable

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