|Yes, Moscow's strategy is political, not economic|
By Ida Garibaldi
With Russia aggressively seeking a monopoly on the distribution of natural gas to Europe, the time is ripe for Washington to push NATO into a greater role in European energy security.
Over the last two years, the Kremlin has shown that it values the political influence associated with the ownership of natural resources and their distribution in Europe as much as the economic gains that come with it. Indeed, Russia's recent use of energy to bully Ukraine and Belarus and the consequent disruptions to distribution in Europe indicate that European energy security represents a serious strategic challenge for the trans-Atlantic alliance.
It is easy to imagine Moscow pushing any EU member to choose between continued supply of energy or support for a specific U.S. policy. It is in Washington's interest to back European energy security now before Russia has too great a hold on the continent. NATO is the right place to do it.
The EU is already deeply dependent on Russia's natural resources, importing 58.3 percent of its total need for natural gas and 82.8 percent of its total oil needs -- of which over 45 and 29.9 percent come from Russia, respectively. It is hard to overestimate the level of state control Moscow wields over the natural-gas industry or its significance to Russia's economy. The U.S. Department of Energy reports that Gazprom, Russia's state-run gas monopoly, is Russia's largest earner of foreign currency and its tax payments comprise fully one-quarter of the state's tax revenues.
Brussels and Moscow share mutual concern for the stability of their energy relationship. The EU is Russia's biggest energy export market and a source of steady profit, while without Russia the gas stoves would go out across Europe.
Whether this reciprocal dependency will be sufficient to maintain the durability of the relationship is an open question.
Only in September 2007 did the European Commission begin to seriously address its energy challenges. The EU Third Legislative Package on Electricity and Gas Markets endorsed the liberalization of European energy markets as well as the separation between the channels of production and distribution. The legislation requires each country interested in competing in the EU energy market to apply the same market-liberalization standards that the EU wants to apply to its member states. This includes access for European firms to purchase pipelines and other energy infrastructure in Russia and other countries involved in the European energy market.
The proposed legislation will probably be insufficient to achieve a substantial energy market liberalization due to the fierce resistance from France, Germany, and other EU members. And it will certainly not be enough to counterbalance Gazprom's penetration in Europe, but it represents an important step in the right direction, one on which Washington should build.
Senator Richard Lugar (Republican, Indiana) has argued that NATO should treat the manipulation of energy supply and its use as a weapon as a trigger to apply Article 5 of the North Atlantic Treaty, which states that an attack against one member of the alliance should be considered an attack against all members. European energy insecurity is a potentially lethal threat to NATO's unity, and could split the alliance between vulnerable and nonvulnerable members.
Including the use of energy as a weapon under NATO's Article 5 would work as a deterrent against aggressive behavior; developing (and publicizing) NATO's ability and willingness to supply a member that has come under attack by a hostile supplier would also greatly reduce the likelihood of such an attack in the first place.
In the short and medium terms, NATO could take other steps to demonstrate its attention to European energy security. These include encouraging Romania (a member) and Ukraine (a potential future member) to thoroughly question Russia and Gazprom about the construction of the South Stream pipeline, which would pump gas from Russia directly into Europe, bypassing Turkey. Because the pipeline would cross Romanian and Ukrainian economic zones in the Black Sea, Bucharest and Kyiv have the right under international law to inquire about the project's environmental impact, shipping and maritime safety, as well as request changes in the pipeline's route. This could give Washington, Istanbul, and Brussels an opportunity to build consensus around a trans-Caspian pipeline to bring natural gas from Central Asia to Turkey and the European Union bypassing Russia.
The largest summit in NATO's history, the Bucharest meeting on April 2-4 will focus on NATO's operations in Kosovo, Afghanistan, Operation Active Endeavor, and a potential future enlargement. It is a full agenda for a two-day meeting, but one that should at least make time to lay out the time frame for a thorough discussion on energy security.
The longer the United States and its European allies wait to involve NATO, the more entrenched Russia's presence in Europe will become, diminishing the alliance's leverage with potentially destructive consequences for the trans-Atlantic relationship.
Ida Garibaldi is a visiting research fellow at the American Enterprise Institute
|No, Moscow's strategy is economic, not political|
By Andrew C. Kuchins
Ever since the Gazprom-Ukrainian gas dispute of January 2006, some have called for engaging NATO in a new mission to promote European energy security.
Even Richard Lugar (Republican, Indiana), one of the Senate's most thoughtful and experienced voices on foreign policy, in 2006 called for NATO to engage Article 5 of the North Atlantic Treaty in the event of the "manipulation" of the energy supply and its use as a "weapon."
Such policy prescriptions are based on faulty analyses of the problem. Furthermore, it would prove impossible to reach agreement upon, let alone implement, a solution and the process would distract NATO from far more pressing issues.
First, it is highly debatable to assert that Gazprom/Russia used energy as a "political weapon" either with Ukraine over gas or Belarus over oil. This is not the place to repeat the history of those disputes, but the fact remains that Gazprom is raising prices for all its customers, including domestic consumers in Russia, albeit at different rates. The promised end result over the next few years will be to equalize net-back prices of gas supplies to all European customers.
Reduction of subsidies actually means more commercialized and less politicized energy relations. Higher prices also contribute to the increased ability of Gazprom to make the necessary investments in new fields to assure it will be able to meet its contractual commitments to Europe in the future. There are a myriad of things to criticize Gazprom for, but this broad strategic orientation is the right one. Whether Gazprom can effectively implement its goals remains to be seen.
Cries of the growing gas dependence of Europe on Russian supplies leading to greater vulnerability to political manipulation are exaggerated. Supplies of liquefied natural gas from other non-Russian sources are growing quite rapidly and, according to estimates by Nikos Tsafos of PFC Energy, this is likely to be the case to the year 2020. Europe's dependency on Russian gas is more likely to stay close to the current 25 percent of all the gas Europe consumes than to significantly rise with time.
If Europeans really were so concerned about vulnerability to Russia, then the better answer is to move more quickly to liberalize the European energy markets to encourage the development of infrastructure that can ship gas from west to east, thus providing real alternatives to those countries in the east that are most dependent on Russian supplies. There are a variety of commercial and European regulatory measures far more appropriate for the task of promoting energy security than would be invoking the venerable political-military alliance of NATO.
We also need to remember that NATO is a consensus organization; one needs the agreement of all members for it to take action. If there is a real and not exaggerated problem of energy security, then the real solution must come from the concerted action of the European Union, which is formally tasked with economic and trade issues.
Part of the problem of energy security for Europe vis-a-vis Russia is tied to the EU states' varying degrees of dependency on Russia: from some countries that receive no gas from Russia to others that are 100 percent dependent on Russian supplies. If Europe is not capable of reaching a common policy towards Russia on energy, a policy track I would not advise in any event, why would we ever assume that NATO could reach consensus more easily?
My final and most serious objection to engaging NATO on European energy security is that the organization is already overburdened with its current responsibilities, and it faces major challenges in maintaining consensus about its mission in the more traditional security field. This is most obvious today in the difficulties the alliance is encountering in Afghanistan with mustering adequate forces to maintain peace and promote reconstruction and development.
While there is a lot of press attention to the question of future membership of Ukraine and NATO, the most pressing issue at the summit in Bucharest is how to achieve success in Afghanistan and how to encourage more equitable member contributions to that success.
If NATO is ultimately unsuccessful in Afghanistan, then we will face a much more pressing question of the alliance's raison d'etre and future rather than speculating about an inappropriate mission for the organization in promoting energy security.
Andrew C. Kuchins is director and senior fellow at the Center for Strategic and International Studies' Russia and Eurasia Program