Gas Wars - II

Some energy-related items from RFE/RL Newsline (June 20):

RUSSIAN MINISTER OPPOSES 'ENERGY OPEC' AND 'ENERGY NATO.' Foreign Minister Sergei Lavrov told reporters in Moscow on June 20 that he opposes any project for gas producers to form an organization similar to the Organization of Petroleum Exporting Countries (OPEC), Interfax reported. He denied that he has heard such proposals, although Valery Yazev, who heads the State Duma's Energy, Transport, and Communications Committee, made the suggestion recently (see "RFE/RL Newsline," June 1 and 6, 2006). Lavrov nonetheless said that he has "heard other calls to create an 'energy NATO' [of consumers to prevent blackmail by suppliers], and this idea certainly is confrontational." During the recent Ukrainian gas crisis, Polish leaders called on consumers to form an "energy NATO" to protect their interests(see "RFE/RL Newsline," January 6, 19, and 20, 2006). PM

RUSSIAN LEGISLATOR HAILS POSSIBLE 'GAS ALLIANCE' WITH IRAN. Mikhail Margelov, who chairs the Federation Council's International Relations Committee, was quoted on June 17 by the state-run daily "Rossiiskaya gazeta" as saying that Putin's recent meeting in Shanghai with Iranian President Mahmud Ahmadinejad could mark the beginning of a "gas alliance" between the two countries that would benefit them both see "RFE/RL Newsline," June 15, 2006). At their meeting, Ahmadinejad suggested that the two countries work together to determine the price of natural gas. Margelov noted that "considering that Iran ranks second in the world after Russia in terms of gas reserves, a coordinated gas policy for our countries could make the blue-fuel market more stable and predictable." In related news, the daily "Gazeta" on June 19 discussed the possible implications of an Iranian offer for Gazprom to participate in a gas pipeline linking Iran,Pakistan, and India, which could be extended to China. The paper noted that Russia could exert pressure on its European customers by participating in a pipeline project that would link it to potential Asian buyers. The daily added, however, that "the only problem is that Europe might decide to deal with Russia's gas blackmail seriously and find alternative energy sources. In that case, Russia would have to sell its gas to Asia, but [Asians] won't pay the high prices that Russia charges Europe. Moreover, Gazprom is preparing to help Iran, which is a potential competitor" on the European market (see "RFE/RL Newsline," June 12, 16, and 19, 2006). PM

RUSSIA SEEKS GREATER ACCESS TO BRITISH GAS MARKET. Gazprom has reached an agreement with the Danish firm DONG Energy to supply it with 1 billion cubic meters of gas annually once the planned the planned North European Gas Pipeline, running from Vyborg to Greifswald, comes into service in 2011, the BBC reported on June 19. For its part, DONG will begin in 2007 to sell 600 million cubic meters of gas to Gazprom's U.K. trading arm, giving the Russian monopolist a greater share of the U.K. market. There was opposition in the United Kingdom recently to the possible Russian acquisition of Centrica, the largest U.K. gas distributor (see "RFE/RL Newsline," April 18, 20, 25, and 26, 2006). PM

See also in this blog: Gas Wars