News / Economy

Russia-Ukraine Standoff Prompts Energy Fears in Europe

Russia-Ukraine Standoff Prompts Energy Fears in Europei
X
March 05, 2014 3:40 AM
Gas prices have risen in Europe over fears the standoff between Russia and Ukraine could result in disruptions to supply -- and possibly undermine the continent’s economic recovery. But as Henry Ridgwell reports for VOA from London, it’s not the first time such a dispute has hit Europe’s energy supplies -- and this time officials say they’re now better-prepared.
Henry Ridgwell
Gas prices have risen in Europe over fears the standoff between Russia and Ukraine could result in disruptions to supply and possibly undermine the continent’s economic recovery. However, it’s not the first time such a dispute has hit Europe’s energy supplies -- and this time officials say they’re better prepared.
 
Russia supplies around a quarter of Europe’s gas. Ukraine sits between them both, so any potential for regional conflict has a direct effect on this vital energy supply line.
 
“The prices have risen in the traded market over the past couple of days because of anxiety about the availability of gas over both the medium and the long term,” said Simon Pirani, a senior research fellow at Britain's Oxford Institute for Energy Studies.
 
Ukraine itself is highly reliant on Russian gas. The Russian firm Gazprom says that beginning next month, it will raise the cost of gas it sells over the border. The Ukrainian state-owned firm Naftogaz owes Gazprom around $2 billion.
 
The European Commissioner for Energy, Gunther Oettinger, said Tuesday the EU would pay Ukraine’s gas bills, adding that there are no immediate concerns of shortages in Europe.
 
“At the moment, in member states, the gas situation is good. We’ve had a mild winter, our storage capacity is fuller than it was last year and we’ve got reserves everywhere,” said Oettinger.
 
In 2006 and in 2009, Russia cut off gas supplies to Ukraine over price disputes -- causing subsequent shortages in Europe. Cold winters and low stockpiles meant the gas price soared.
 
Europe is now less reliant on Ukraine as a transit route for Russian gas. The North Stream pipeline, which was opened in 2011, takes gas directly under the Baltic Sea to Germany -- Russia’s biggest European customer.
 
“There’s also been quite a lot of work done in central and eastern Europe as a result of the 2009 dispute when people realized that Russia-Ukraine disputes could have implications further down the pipeline,” said Pirani.
 
That includes the South Stream project. President Vladimir Putin attended an on-site ceremony as the first pipes were welded together in 2012. The pipeline will run along the bottom of the Black Sea directly to southeast Europe. It’s due to come online in 2015 and reach its full capacity -- roughly half of Europe’s demand -- by 2018.
 
But hostility between Moscow and Europe is growing over Russia’s apparent troop deployment in Crimea, which Moscow denies.
 
The EU has threatened as-yet unspecified sanctions. So would Russia retaliate by turning off the gas taps to Europe? Unlikely, thinks Pirani.
 
“Gazprom’s a commercial company, it has to make money, and it wants to deliver its gas to its customers in Europe,” said Pirani.
 
Analysts say the current tensions will likely make Europe redouble its efforts to find alternative energy supplies and cut its reliance on Russia.

You May Like

African States Push to Keep Boko Haram Offline

Central African telecoms ministers working with Nigeria to block all videos posted by Boko Haram in effort to blunt Nigerian militant group's propaganda More

Falling Oil Prices, Internet-Savvy Youth Pose Challenge for Gulf Monarchies

Across the Gulf, younger generations are putting a strain on traditional politics More

Philippines Call Center Workers Face Challenges

Country has world’s largest business process outsourcing, or BPO, industry, employing some one-million workers More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
US Supreme Court Hears Hijab Discrimination Casei
X
Katherine Gypson
February 25, 2015 11:30 PM
The U.S. Supreme Court has heard opening arguments in a workplace religious discrimination case that examines whether a clothing store can refuse to hire a young woman for wearing the headscarf she says is a symbol of her Muslim faith. Katherine Gypson reports from the Supreme Court.
Video

Video US Supreme Court Hears Hijab Discrimination Case

The U.S. Supreme Court has heard opening arguments in a workplace religious discrimination case that examines whether a clothing store can refuse to hire a young woman for wearing the headscarf she says is a symbol of her Muslim faith. Katherine Gypson reports from the Supreme Court.
Video

Video Falling Gas Prices Hurt Nascent Illinois Hydraulic Fracturing Industry

Falling oil prices are helping consumers purchase cheaper petroleum at the pump. But that’s made hydraulic fracturing or “fracking” less economically viable for the companies in the United States invested in the process. VOA’s Kane Farabaugh reports on one Midwestern town that was hoping to change its fortunes by cashing in on the next big U.S. oil boom.
Video

Video Fighting in Sudan's South Kordofan Fuels Mass Displacement

Heavy fighting in Sudan's South Kordofan state is causing hundreds of thousands to flee into uncertain conditions. Local aid organizations estimate as many as 400,000 civilians have been internally displaced since the conflict began more than three years ago, while another 250,000 have fled across the border to refugee camps in South Sudan. VOA's Adam Bailes reports.
Video

Video Lao Dam Project Runs Into Opposition

A Lao dam project on a section of the Mekong River is drawing opposition from local fishermen, international environmental groups and neighboring countries. VOA's Say Mony visited the region to investigate the concerns. Colin Lovett narrates.
Video

Video A Filmmaker Discovers Her Biracial Identity in "Little White Lie

Lacey Schwartz grew up in an upper middle-class Jewish family, in a town in upstate New York where almost everyone she knew was white. She assumed that she was, as well. Her recent documentary, Little White Lie, tells the story of how she uncovered the secret of her true racial background. VOA’s Carolyn Weaver has more on the film.
Video

Video Deep Under Antarctic Ice Sheet, Life!

With the end of summer in the Southern hemisphere, the Antarctic research season is over. Scientists from Northern Illinois University are back in their laboratory after a 3-month expedition on the Ross Ice Shelf, the world’s largest floating ice sheet. As VOA’s Rosanne Skirble reports, they hope to find clues to explain the dynamics of the rapidly melting ice and its impact on sea level rise.
Video

Video US-Cuba Normalization Talks Resume Friday

Negotiations aimed at normalizing diplomatic relations between the U.S. and Cuba resume Friday. On the table: lifting a half-century trade embargo and easing banking and travel restrictions. There's opposition in Congress, but some analysts say there may be sufficient political and economic incentives in both nations for a potential breakthrough this year. VOA's Mil Arcega reports.
Video

Video Pakistan's Deadline For SIM Registration Has Cellphone Users Scrambling

Pakistani cell phone users have until midnight Thursday to register their SIM cards, or their service will be cut off. While some privacy experts worry about government intrusion, many Pakistanis are just worried about keeping their phone lines open. VOA Deewa reporter Arshad Muhmand has more from Peshawar.
Video

Video Myanmar Warns Factory Workers to End Strikes

Outside Myanmar's main city Yangon, thousands of workers walked off their jobs earlier this month demanding a doubling of their wages, pay raises after a year and input from labor unions on industrial regulations. Since Friday, the standoff has grown more tense as police moved in to disrupt the sit-ins, resulting in clashes that injured people from both sides. VOA correspondent Steve Herman visited industrial zones which have become a focus of Myanmar's fledgling workers rights movement.
Video

Video Oscar Winners Do More Than Thank the Academy

The Academy Awards presentation is Hollywood’s night to reward the best movies from the previous year. It’s typically a lot of glitter, a lot of thank you’s, a lot of speeches. But many of this year’s speeches carried messages beyond the thank you's. VOA’s Carolyn Presutti takes a look.

All About America

Circumventing Censorship

An Internet Primer for Healthy Web Habits

As surveillance and censoring technologies advance, so, too, do new tools for your computer or mobile device that help protect your privacy and break through Internet censorship.
More

World Currencies

EUR
USD
0.8896
JPY
USD
119.26
GBP
USD
0.6475
CAD
USD
1.2451
INR
USD
61.816

Rates may not be current.