Wednesday

30th Nov 2022

War in Ukraine seen as watershed for EU gas addiction

  • Russia produces ten percent of global oil and supplies nearly 40 percent of Europe's gas (Photo: www.south-stream.info)
Listen to article

Western sanctions, while unprecedented, have left the Russian energy exports largely unscathed – raising questions about the EU's willingness to break its addiction to natural gas.

And with prices of gas soaring, and costs for ordinary Europeans a looming political hot potato, there is resistance to making a clean break even though petroleum and oil and gas make up the country's largest export products by value.

Read and decide

Join EUobserver today

Become an expert on Europe

Get instant access to all articles — and 20 years of archives. 14-day free trial.

... or subscribe as a group

But on Monday (28 February), a number of EU energy ministers called on the rest of the bloc to make the Russian invasion of Ukraine a turning point for the way Europe gets its energy.

Cutting European demand for the coal, oil and gas imported from Russia would be "the best way to take on Vladimir Putin," Irish environment and climate minister Eamon Ryan said ahead of a ministerial meeting in Brussels.

"Our reliance on fossil fuels has cost us dearly," said Ryan, referring both to the EU's Russia-dependence and the climate.

Spanish energy minister Teresa Ribera said reliance on Russia had created "an immense fragility" in the European energy system that required a rapid acceleration of the transition to cleaner — and therefore non-Russian — sources.

Belgian energy minister Tinne van der Straeten echoed that. She noted that the war, despite its scale and unfolding horror, had not disrupted gas flows from Russia to the EU.

The invasion of Ukraine was not only "a watershed moment" for the security architecture of Europe but also for the bloc's energy system, EU energy commissioner Kadri Simson told a press conference.

The invasion "has made our vulnerability painfully clear," said Simons, who added that, in the long term, the best solution was an overhaul of the continent's energy systems under the European Green Deal, which mandates no net emissions of greenhouse gases by 2050.

Financing the war with euros?

Russia's sales of oil and natural gas accounted for about 36 percent of its budget in 2021, totalling over €100bn, according to data released in January by its finance ministry.

Those sales amount to 10 percent of global oil supplies — and 40 percent of Europe's gas demand.

To be sure, the EU and allies like the US are hurting the Russian economy — but they are mostly keeping oil and gas trade flowing in a bid to stave off inflation and volatility in the energy markets.

The EU, US, and their allies agreed on Saturday to cut off a number of Russian banks from the international-payments system SWIFT as a step toward isolating Russia from the international financial system.

Even so, authorities on both sides of the Atlantic are coordinating to spare those banks handling most of the energy flows to limit energy supply disruptions, a senior US administration official told a press briefing on Sunday.

UN secretary-general António Guterres said on Monday that events in Ukraine helped to illustrate how fossil-fuel reliance made the global economy and energy security vulnerable to "geopolitical shocks and crises."

His warning came as the latest report of the UN's Intergovernmental Panel on Climate Change (IPCC) on Monday sounded the alarm on the devastating impacts that climate change — driven by centuries of burning fossil fuels — has had on nature and people.

Hans-Josef Fell, a former member of the German parliament for the Green Party and the founder of the Berlin-based Energy Watch Group, said energy sanctions would be "the only way to really hurt the Russian economy."

A massive expansion of renewable energies would reduce Europe's energy and political dependence on Russia and, he said, finally put an end to "financing the Russian war economy with hundreds of billions of euros."

Analysis

What the Russia conflict might mean for gas prices

In the worst-case scenario gas suppliers wouldn't be able to rebuild their inventories over the summer, industries would have to shut down, and energy rationing may be inevitable.

Russia launches full-scale attack on Ukraine

EU leaders immediately condemned the invasion, with European Commission president Ursula von der Leyen calling on Russia to withdraw its forces and vowing further sanctions.

Russian banks, oil refineries to face EU freeze

Russian banks and oil refineries to be hobbled by new EU sanctions, as civilian deaths mount in Ukraine. US wanted to exclude Russia from SWIFT, but Germany and France favoured incremental approach.

It's not easy being green — and cutting Russian gas

There are growing concerns that the EU's push for alternative gas sources will simply lead to burning the most-polluting sources as Russian gas gets phased out. But the EU climate chief says there should be no taboos.

News in Brief

  1. 'Pro-Kremlin group' in EU Parliament cyberattack
  2. Ukraine will decide on any peace talks, Borrell says
  3. Germany blocks sale of chip factory to Chinese subsidiary
  4. Strikes and protests over cost-of-living grip Greece, Belgium
  5. Liberal MEPs want Musk quizzed in parliament
  6. Bulgarian policeman shot dead at Turkish border
  7. 89 people allowed to disembark in Italy, aid group says
  8. UN chief tells world: Cooperate on climate or perish

Stakeholders' Highlights

  1. Nordic Council of MinistersCOP27: Food systems transformation for climate action
  2. Nordic Council of MinistersThe Nordic Region and the African Union urge the COP27 to talk about gender equality
  3. International Sustainable Finance CentreJoin CEE Sustainable Finance Summit, 15 – 19 May 2023, high-level event for finance & business
  4. Friedrich Naumann Foundation European DialogueGender x Geopolitics: Shaping an Inclusive Foreign Security Policy for Europe
  5. Obama FoundationThe Obama Foundation Opens Applications for its Leaders Program in Europe
  6. EFBWW – EFBH – FETBBA lot more needs to be done to better protect construction workers from asbestos

Latest News

  1. EU Commission proposes suspending billions to Hungary
  2. EU: Russian assets to be returned in case of peace treaty
  3. Frontex leadership candidates grilled by MEPs
  4. Portugal was poised to scrap 'Golden Visas' - why didn't it?
  5. Why the EU asbestos directive revision ... needs revising
  6. Nato renews membership vow to Ukraine
  7. Catalan spyware victims demand justice
  8. Is the overwhelming critique of Qatar hypocritical?

Stakeholders' Highlights

  1. European Committee of the RegionsRe-Watch EURegions Week 2022
  2. UNESDA - Soft Drinks EuropeCall for EU action – SMEs in the beverage industry call for fairer access to recycled material
  3. Nordic Council of MinistersNordic prime ministers: “We will deepen co-operation on defence”
  4. EFBWW – EFBH – FETBBConstruction workers can check wages and working conditions in 36 countries
  5. Nordic Council of MinistersNordic and Canadian ministers join forces to combat harmful content online
  6. European Centre for Press and Media FreedomEuropean Anti-SLAPP Conference 2022

Join EUobserver

Support quality EU news

Join us