Europe's oil shock ... and opportunity
Strongmen make weak partners, as Europe had to learn again this week. For the second time in a year, Russian leader Vladimir Putin cut off fuel exports to the Continent in a money dispute with a former Soviet satellite that is a pipeline transit state. This is not Europe's idea of energy security or of trusted neighbors.
The latest incident involved a refusal by neighboring Belarus to pay more for the subsidized oil that it has long received from Russia. Last year, it was Ukraine that refused to pay more for Russian natural gas. In both cases, a Moscow eager to end fuel subsidies to states flying out of its orbit of influence decided, unwisely, to play hardball. It temporarily turned off the spigot to the pipeline passing through those countries, sending political shivers through a dependent Europe in the depth of winter.
Russia is the world's largest exporter of natural gas and the second-largest of oil, after Saudi Arabia. It provides more than a quarter of the European Union's oil and more than two-fifths of its natural gas. The Continent's heavy dependency on imported fuels, combined with these two energy shocks, helped lead the European Commission (EC) Wednesday to ask its 27 member states and 500 million citizens to develop a new energy strategy.
Germany, most of all, was stunned by this second Russian cutoff. Chancellor Angela Merkel, who is also now the EU president, said this latest case of Russia's energy unreliability "hurts trust and it makes it difficult to build a cooperative relationship." She also cast doubt on Germany's decision to close down its 17 nuclear power plants during the next 14 years.
But more than being concerned about its energy future, the EU needs to rethink its kid-gloves diplomacy toward Putin's increasingly authoritarian ways, such as his heavy hand in the oil and gas industries.
It can also be alert to the possibility that Belarus may now be ripe for a "color" revolution like those in Georgia and Ukraine. An end to fuel subsidies will probably stir popular rebellion in the Soviet-style economy and jeopardize the rule of President Alexander Lukashenko (dubbed the "last dictator in Europe"). Putin appears to have soured on creating a union with Belarus, opening up an opportunity to win over that country's 10 million impoverished people to democracy.
Moscow's attempts to control the former Soviet states with its resource dominance is a failing strategy, as more of those states try to buck Russia's energy yoke. Europe, in turn, can reduce its dependency on Russia by adopting the EC's vision of partnering with other petroleum-rich nations and turning swiftly to alternative fuels, such as biomass, wind, and solar. "Europe must lead the world into a new, or maybe one should say, postindustrial revolution, the development of a low-carbon economy," said EU Commission President José Manuel Barroso.
Many European governments need to create more competition in their energy and electricity industries. Suppliers, for instance, should not also control transmission networks. Such steps are necessary because energy security is now as important in foreign policy as terrorism. This latest fuel transit row with Russia should speed up a new energy future for Europe.