Energy security: running
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Energy security: running on empty?
If you asked a man in the street in Europe whether he thought Ukraine should pay the market price for gas, he would probably have few strong feelings on the issue. However, if you told him that this question could decide whether his home would be warm or freezing in winter, he would probably show more interest. In this edition, we look at what effect Russia's manoeuvres in Ukraine could have further down the pipeline.
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What do the changes to the energy landscape following the Ukraine crisis mean for NATO? How does the organization need to change to better face energy challenges? We ask some top commentators and politicians what kind of changes they feel should be made.
Many saw Russia's annexation of Crimea as a land grab, or securing a base for its Black Sea fleet, or just part of a plan to destabilize Ukraine. But there are major energy consequences too, as Frank Umbach explains.
A possible energy standoff between Russia and the EU would be playing for high stakes. Europe could lose around a third of its energy supplies. Russia could lose about half of its state budget. Who should blink first - and why?
The Ukraine-crisis has once again underlined Europe’s vulnerability due to its overdependence on Russian energy supplies. Europe is vulnerable in the short-term, but Russia has more to lose in the medium- and long-term. Could the crisis be an opportunity to further weaken Russia’s stranglehold over Europe’s energy sector?
It's not yet clear how the events in Ukraine will impact on Europe's energy security. Or if it will change European priorities vis-à-vis renewable energy. So we asked our NATO Review cartoonist, Rytis Daukantas, to give us a sideways view of what he thought the potential changes could look like.
A politico-military organization like NATO is not necessarily in its comfort zone when dealing with commercial energy deals, major pipeline projects and fossil fuel diversification. But as energy becomes an increasingly potent weapon in conflicts which can have a major impact on most of NATO's members, it's time for the Alliance to learn what it can do.
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You can come at energy security from many different angles. But one jumped out at me as I was thinking how to start this editorial.

I looked down at the day’s edition of the Financial Times and saw a front page quote relating to potential energy problems arising from the Ukraine crisis. ‘We have a responsibility to stand with our partners in difficult times,’ said a Western businessman.

Nothing major there. It’s a statement that has been made across the NATO Alliance by multiple politicians and diplomats since Russia’s Crimean annexation. But what made this statement special was that this person wasn’t talking about security partners. He was talking about business partners.

The statement was made by Bob Dudley, chief executive of BP (British Petroleum). He said this in Moscow, shortly after BP signed an estimated $300 million shale oil deal with Russia’s state-owned company Rosneft. BP owns just under 20% of Rosneft.

And this is not an isolated example of mixing of security and business interests. Rosneft has joint ventures with several other western energy companies, including ExxonMobil and Statoil.

This example shows how the West is sometimes not singing from the same hymn sheet in responding to the crisis. For example, why some countries with heavy investments and strategic interests in new energy infrastructure projects like the South Stream pipeline may not be as enthusiastic about sanctions as other NATO nations who want sterner responses.

But it also shows why this is so difficult.

Elected governments are there to provide security, but also to improve economies. These can often go hand in hand. But the latest crisis has shown that there may be conflicts in trying to attain both at the same time. For example, how can governments explain to their voters that more expensive fuel bills (which may well be a consequence of the crisis) are part of making the country safer?

In this edition of NATO Review, we look at who is set to win or lose (in terms of energy) from the change in the security landscape. We ask what role NATO can realistically play, in an area dominated (in the West at least) by private, independent, commercial companies. And we look at possible solutions – albeit medium term ones – that Europe can look to, so that it’s energy dependence on Russia can continue decreasing.

Paul King

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Barack Obama,
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