Gas trade between Russia and the European Union: From tensions to cooperation?

Résumé du document

In 2008, Russia sold 160 billion cubic meters of gas to the European Union (EU), which represented 70% of Russian gas exports, 30% of the EU's needs and 50% of its imports. For over thirty years, the Russian company Gazprom has supplied the EU with most of the gas required by it. Gazprom plays a key role in the relations between the EU and Russia. As this energy partnership combines trade, economic, political and strategic issues, the development of gas trade has been accompanied by disputes and tensions during the 2000s. In this essay, we are going to see why gas trade causes troubles and the main issues and prospects raised by Russia/EU gas trade.

Extraits

[...] Yet Russia decided not to implement it. Russia hasn't still adopted these rules for two reasons: the subsidized gas supplies in Russia require a quasi-monopolistic organization of its market (Russians pay a gas bill ten times cheaper than the Europeans as the turnover of Gazprom relies on its foreign market specially Europe) and a will Mélanie Gergorin to maximize its income. Instead, Russia has indicated that it supported the exchange of assets and as proposed to German, French and Italian companies an access to its gas production cons an access to transportation and end customers in European markets. [...]

[...] For example, member states of the European project plebiscite the Nabucco pipeline, but verbally commit themselves in the Russian competing project, the South Stream pipeline. The European Commission does not interfere faced to these contradictions. It is confined to playing a facilitating role but does not come into conflict with the large member states that have the ability to act by virtue of their own interests. In fact The European Commission does not have the good instruments to interfere, for example it is not able to cover financial risks of large infrastructure project. The European gas markets are still far from integrated, fully competitive. [...]

[...] Russia was one of the few credible options to provide these additional quantities of gas. But difficulties have appeared: President Putin has strengthened state control over the market and production, limiting the access of European companies in the Great Russian Eldorado. Soaring oil prices since 2004 have increased European bills on gas imports, gas prices being indexed to oil products in long-term contracts. This strengthened the economic and political power of Gazprom which posted record profits. Mélanie Gergorin Since 2008, the evolution of gas markets transforms the balance: The burst of the economic crisis in late 2008, the technological revolution in the production of unconventional gas in the United States, the global rise of liquefied natural gas's supply the development of renewable energy and the nuclear revival in Europe, are the vectors of a structural transformation of European and global gas markets. [...]

[...] In turn, European companies should get access to production and export in Russia and Central Asia, which would require greater transparency and open markets. Finally, economic reasoning should take precedence over political logic. Like the realization of the Nord Stream pipeline, which promises to be a success despite some initial difficulties, the Russia / EU relations need positive interaction and confidence on the basis of mutually beneficial projects. It is essential to consider such changes in order to obtain lower prices for consumers and greater energy security. [...]

[...] An objective of the project is to connect the European Union better to the natural gas sources in the Caspian Sea and the Middle East regions. The main supplier is expected to be Azerbaijan in cooperation with Turkmenistan, Iraq and Egypt.), is taking time to be implemented. The share of Russian imports in total EU imports has tended to decrease since the 2000s: the EU has continuously imported ever more gas from other countries (Norway, Algeria, Qatar, Nigeria, Asia), either by pipeline or as LNG. [...]