Gazprom and the EU

The Foreign Policy blog takes a critical look at how the Russian state energy goliath Gazprom is exploiting European disunity and weakness.

German Chancellor Angela Merkel, in a 2006 press conference with Tony Blair, said the European Union needed to work towards a common energy policy to limit the influence of Gazprom, the Russian-controlled energy giant. Merkel’s statement came after Russia, unhappy with the Orange Revolution in the Ukraine, turned off that country’s gas in the middle of the winter. Not long after, Merkel pirouetted and signed a unilateral deal with Russia to supply about 90 percent of German energy. Other large countries have signed similar deals (all under different terms). So much for EU solidarity. . . .

Perhaps anticipating this opposition, the Commission also presented a second plan that allows joint ownership as long as an independent operator controls one of the companies. In other words, Russia would have to create a separate company to distribute gas, while Gazprom produces it. This separation is insignificant, as both companies answer to the same master.

So, the Commission’s victory for collectivism appears to be a hollow one. Until more forceful steps are taken towards EU consensus, Russia will keep striking unilateral deals with European countries, making a common energy policy less and less likely.