Transcript EU-Russian relations within the energy debate

EURO416
The EU/ Russian relationship
within the energy debate- Russian
Oil & Gas supply to the EU.
The EU / Russian Energy
Dialogue.
Important because both parties are bilaterally dependent. EU for resources, and
Russia for the market, investment and technology.
The guidelines for this were laid down in two 2001 summits, these being:
promotion of land transport via pipelines & rail, creation of a pan-European
gas & electricity market, support for reforms in the Russian energy sector, &
cooperation on energy efficiency & technology transfer
The EU’s energy consumption.
The EU currently imports 50% of it’s energy. This will rise to 70% in the next
20 years.
As Russia is the second largest supplier of oil and is the largest supplier of
Gas in the world it is a critical partner of the EU concerning energy supply.
The EU’s Energy Policy
Main Goals: Sustainability, Security & Competitiveness.
•Diversification of the Energy sector.
• Energy efficiency and increased security of supply, while keeping
within the Kyoto Protocol.
•Recognition of Russia as an “equal” partner as there is a bilateral
dependency.
Russia’s need for investments
and its objectives
Present Situation
Objectives:
Infrastructure is dilapidated with
To double its GDP and
reach its forecasted growth
rate of 5-6% between 200310.
a high level of foreign debt.
Lack of competitiveness.
Foreign Direct investment incredibly low at 2.5% of
investment.
To keep state control over
energy resources while
attracting foreign
investment.
Geopolitics: The Baltic example.
The construction of the Primorsk
bypassing the Baltic in order to
have a direct sea connection
and importantly so as not to
pay the transit transport tariffs.
The switching off of pipeline supply
via the Baltic despite continuing
halts in production and transport.
The Paradox: Russia charges
other nations such as
Kazakhstan and Turkmenistan
transit transport tariffs for use
of its network.
Putins view: “the more Russian hands and feet are tied by
transit countries, the more they have a temptation to be
parasites on Russia”
Map of the Baltic Ports
Map of existing and proposed
Oil & Gas pipelines to the EU
The Future.
The present future is good for both the EU & Russia as they
have a good relationship & understanding & importantly
they need each other.
In the long term the EU will be less dependent on Oil &
Gas. This will come as a result of their own push to
diversify energy resources and with the gradual
depletion of Russian reserves.
The energy dialogue will probably have positive outcomes
on the FSU’s, as the EU & Russia work through the various
issues.