Russia stopped supplying gas to Ukraine on 1 January and a week later stopped all supplies to Europe passing through Ukraine. Russia accused Ukraine of stealing gas intended for other European countries. Supplies resumed on 20 January when the Ukrainian government agreed to pay a higher price for the energy.
About one fifth of the European Union’s gas supplies are piped from Russia across the Ukraine. Bulgaria receives 80% of its gas from Russia, Austria 70%, Germany 30% and Italy 17%. In the midst of freezing temperatures Slovakia, the Czech Republic, Bosnia-Herzegovina, Bulgaria, Romania, Croatia, Hungary, Macedonia, Serbia and Greece were particularly hit by the shut down. Slovakia declared a state of ‘energy emergency’ and the French Peugeot-Citroen car factory was closed. There were demonstrations against Russia in several countries. British Prime Minister Brown declared: ‘No nation can be allowed to exert an energy stranglehold over Europe.’ Mighty fine words, but Britain does not import gas from Russia and so bombast was a luxury he could afford.
The dispute is part of the manoeuvres between the US, the EU and Russia for influence in Eastern Europe, the Caucasus and Central Asia, of which August 2008’s war in Georgia was a manifestation. Additionally, Russia needs extra revenues from its energy supplies to maintain economic growth and sustain its now imperiled middle class; falling oil prices have pushed down Russian currency reserves, the war in Georgia hastened a capital flight from Russia and the Russian stock market fell 75% between May and October 2008.
On 5 November Russian President Medvedev said that Russia would place missiles in Kaliningrad, between Poland and Lithuania, if the US goes ahead with stationing its anti-missile system in Poland and the Czech Republic. The Ukrainian government continues to seek membership of the EU and NATO. On 12 December, with Ukrainian President Yuschenko at his side, Russian Prime Minister Putin warned that Russia ‘has its own’ responses to increased US military presence in the region. The then US Secretary of State Condoleezza Rice and the Ukraine foreign minister signed a Strategic Partnership Agreement on 19 December wherein the two countries will increase ‘ongoing programmes of co-operation and assistance on defence and security issues…of benefit to both nations and the region’. The Agreement included US proposals to modernise Ukraine’s gas transit infrastructure and ‘diversify and secure Ukraine’s source of nuclear fuel’. Rice signed a similar agreement with Georgia on 9 January. At a meeting of gas producing countries in Moscow on 23 December, Putin said, ‘the era of cheap energy resources, of cheap gas is…coming to an end’.
With the Russia-Ukraine gas dispute settled for now the manoeuvring and tensions will intensify. Germany is building a gas pipeline with Russia’s Gazprom beneath the Baltic Sea and direct from Russia to Germany, avoiding any third countries. US imperialism will fight harder to control the Caspian and Central Asian oil and gas reserves and pipelines to Europe that do not pass through Russia (the Baku-Tblisi-Ceyhan pipeline and the proposed Nabucco pipeline from Baku through Georgia, Turkey and onto Europe). On 28 January, in a gesture of goodwill towards the new US administration, Russia agreed to suspend stationing missiles in Kaliningrad. The US government must now make its calculations and will soon reveal its hand.
Trevor Rayne
FRFI 207 February / March 2009
