In Focus: Dispute over Russian gas supplies raises energy security concerns in the European Union, January 2006

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Publication Date February 2006
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Gazprom's proximity to the Russian Government suggested that the dispute was part of a Kremlin strategy to impose geopolitical stronghold over the region. A compromise deal was agreed between Gazprom and its Ukrainian counterpart, Naftogaz, on 4 January 2006, effectively doubling prices. This had immediate political consequences when Ukraine's Parliament ousted the Government over the issue on 10 January.

Gazprom's pricing plans and supply cuts not only concerned Ukraine. In the course of the month they triggered similar rows with other former Soviet Republics such as Moldova and Georgia.

In addition, the increased demand in Russia's home market due to the extreme cold wave had repercussions in several European countries - as far as Italy - where decreases in gas supplies were felt.

A combination of these circumstances along with record-high prices for mineral oil reinvigorated the debate in the European Union on how to secure energy supplies to Europe in the long run. High dependency on natural gas from Russia did not seem a desirable option, especially in the light of recent events.

There were renewed calls on Member States to overcome their long-standing reluctance to cede any compentence over energy matters and to engage in EU-wide policy co-ordination with the potential aim to establish a common energy policy.

This tied in with ongoing discussions about how the EU could meet its obligations under the Kyoto Protocol on climate change while energy demand was rising. The Austrian Presidency of the EU put energy issues high on its agenda and it was planned to discuss them as a priority at the Spring European Council in March 2006.

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Thomas Pritzkow
Deputy Editor, European Sources Online
February 2006

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