For Europe’s rulers, latest energy crisis between Ukraine and Russia, has once again emphasized the perils of engagement with Mr. Putin. They are in a very difficult position right now. Not only should they reduce reliance on Russian gas but also be very discreet in terms of other Russian ambitions. Looks like energy politics is not just concerning multi-billion corporate giants.
Russia’s energy card is used for two reasons; to demonstrate its eco-political clout and intimidate europeans. Putin does not miss an opportunity to show the country’s outgoing power in the face several disputes as he did in the latest Georgian War and gas row with Ukraine a year ago. He desires western countries to reaffirm Russia as a world power. He, moreover, likes to revive Europe’s scariest nightmare which is Europe’s almost %50 percent dependency on Russian gas, now and then when and where it is necessary.
Rest assure that, his habits date back to the begining of the 2000s when oil prices began to escalate. Due to successful political and military actions, he managed to toople or tame domestic issues such as Chechenya. When the dust settles, there was a chance for a fresh start. In such an atmosphere with domestic calm and economic boost, Russia’s image which was tainted with the fall of Soviet Union, needed to be polished.
The main driving force behind Russia’s belligerent actions is the result of such image restoring bid. Nevertheless, there is no single thing in the world that is not counterbalanced by others. First, the energy prices which climbed up to 140$ a barrel in August, experienced a record fall. Bearing in mind that Russia’s huge foreign reserves are energy earnings stemmed from abnormal economic bubbles and conditions, this would broadly affect Russia’s economy which has already begun to feel ramifications of a recession.
Secondly, Russia’s customers –mainly EU- have already started to seek alternative resources and routes. Projects as Nabucco are voiced loudly and employed as a leverage –if not alternative- against Putin’s unpredictable tendencies. More to the point, European leaders have agreed on “20-20-20” plan on December which envisions to provide %20 of total energy production from renewable sources by 2020. Turkey, on the other hand, attaches more and more importance to energy ties with Iran and furthermore targets to be the new energy hub which would try to by-pass Russia by transfering Middle East oil and Caspian gas into the Europe.
Domestic woes would also require more “energy”. Since energy prices’s downturn, flaws of the Russian markets have buoyed more clearly. Government failed to prevent substantial loss in local currency, unemployment is on the rise and figures of growth are not the same they were used tı, although Russia is expected to grow around %4 this year. These economic problems would probably lead to significant social unrest in the country where political oppression on dissidents is common. Since protesters are deemed as western plotters to undermine Russia’s image on the international fora by the government, there is a good chance that such opposition would sparked further furore. Dealing with these issues would distract Russian bureaucracy and requires inward looking policies consuming more energy than external ones.
Yet, Russia has substantial potential both economic and political. According to estimates of the International Energy Agency, oil price a barrel would stabilize around 100$ a barrel in the long run. And that will alone be a great hinge for Russia’s economy controlling huge gas and oil fields which will guarantee countries economic future at least for 50 years in the absence of extraordinary economic shocks. It should not be worried by Europe’s efforts to diversify routes and resources either. For now, the “20-20-20” plan is a long shot, and could not be materialized in a short period of time. In the best case scenario, continent will contine to rely on Russian resources until the next decade and that might be proved to be optimistic. More to the point, building up new routes takes at least a decade, let alone the costly technology of renewable energy.
The problem is not whether Europe could minimize its dependency on Russia but how it would reconcile with it by not offending both U.S. and eastern neighbours. A new appeasement policy which aims to ease Russia’s temper and encouraging western-style democracy at the same time, might be employed. After all, isn’t that the job description of the chief of the CFSP*?
* Common Foreign and Security Policy