It is sometimes hard to imagine how the EU can ever develop an effective policy on Russian energy when so many obstacles stand in the way. Member states rely on Russian oil and gas to very different degrees, while a co-ordinated approach to Moscow is complicated by the weak interplay between the European Union’s energy strategy, its trade policy and the Common Foreign and Security Policy. Moscow, meanwhile, is inordinately sensitive about the EU’s aim of reducing its reliance on Russian supplies, making bilateral relations tougher still.
But no matter how difficult, an effective EU-Russian energy policy is a must. Russia will remain Europe’s number one energy supplier for the foreseeable future, while Russia’s growing importance on Eurasian and world energy markets means that EU-Russian relations will increasingly have a global dimension. Developing an effective EU-Russian energy policy is therefore more than a matter of improving relations with a neighbour; it is an essential component of Europe’s external policy.
The inadequacies of the present arrangements were amply demonstrated during the January 2009 gas crisis. Since then EU governments and institutions have been struggling to put in place the political, commercial, financial, infrastructural and regulatory ingredients of a sustainable energy and climate policy. Once implemented, these measures should among other things ensure that third country suppliers – including Gazprom, Russia’s gas export monopoly – fully comply with EU competition laws. Gazprom is keener on complying with the EU’s Third Liberalisation Package than the Russian government, which refused to ratify the international Energy Charter in case that led to EU demands for access to Russian pipelines.
In the meantime there is no good reason not to put energy relations with Russia on a more pragmatic footing, especially since both sides currently have pressing economic reasons for doing so. Greater co-operation in the field of energy could then help to develop a mutual understanding about how each side could help the other to attain its wider economic goals.
For Russia these goals would include modernisation, economic diversification, higher productivity and reform of the domestic energy sector, together with the acquisition of downstream energy assets in Europe. Russia also wants an influx of EU investment and access to European technology. Clearly, the EU could help Russia achieve these ambitions, provided the conditions were right.
For Europe the priorities include diversification of external sources, suppliers and routes, notably the new trans-Caspian gas pipeline from Azerbaijan and Turkmenistan, a solar energy plan with southern Mediterranean neighbours, and integrating central and south eastern Europe with an up-to-date energy infrastructure. An effective EU-Russian energy policy could help Moscow to become more tolerant of these plans, perhaps even receptive to the idea of the EU finding alternative energy sources to Russia.