An energy lesson from Crimea crisis
When the history of the “Crimean crisis” between Russia and Ukraine is written, perhaps it will note this hopeful aftereffect: The crisis finally forced an end to countries threatening a cutoff of oil or gas exports as a weapon of coercion.
The world’s dependency on fossil fuels has long led nations rich in petroleum to muscle those poor in energy. The United States did it with Japan in 1940, leading to the attack on Pearl Harbor. Arab oil exporters did it in 1973 in protest over an Israeli war victory. And for years, Russia has coerced former Soviet states by playing the energy card with its vast oil and natural gas supplies.
The crisis in Ukraine began last fall because the country was leaning toward joining the European Union, a move that would have helped it develop its ample shale-gas deposits and become less dependent on Russian gas imports.
To counter this threat, President Vladimir Putin offered to subsidize Ukrainian gas prices. But now that the protests in Ukraine have put pro-democracy leaders in power, Russian giant oil monopoly Gazprom is threatening to raise the price of gas exports. Twice over the past decade, in 2006 and 2009, a dispute between Kiev and Moscow led to a gas cut – not only for Ukraine but, because of pipeline routes, for Europe.
Europe has partly learned its lesson and has started to diversify its energy sources. The EU still relies on Russia for more than a quarter of its gas, but new suppliers, such as Norway and Algeria, are being tapped.
Many European leaders remain wary of imposing tough sanctions on Russia over its forceful control of Ukraine’s Crimean Peninsula. “We will not be able to efficiently fend off potential aggressive steps by Russia in the future, if so many European countries are dependent on Russian gas deliveries or wade into such dependence,” said Polish Prime Minister Donald Tusk in a news conference Monday.
To help protect Ukraine from Russia’s energy bullying, the US has offered a $1 billion loan guarantee that can help with any gas shock. Many in Congress also want the US to rush the approval of exports of liquefied natural gas to Europe. Since 2011, the Department of Energy has conditionally approved six proposals to export LNG. Further action would not bring gas supplies to Europe until 2016 at the earliest. But it would at least send a signal that the West is serious about creating peace through better energy security.
The Ukraine crisis has cast doubts about the idea that economic interdependency creates a safer world. Russia, a strong believer in hard power, relies on oil and gas trade for half of its export revenue and more than half of its government budget. How far is Mr. Putin willing to go toward jeopardizing his regime for a strategic victory over Ukraine, Europe, and the US?
If he backs off the use of energy threats, it may be a signal that more countries are rejecting fuel as a tool for global power.
Each political shock over petroleum has set countries scrambling for alternative energy supplies. What many have discovered is an abundance of sources, such as better solar-cell technology, more-efficient wind turbines, and new techniques such as fracking (hydraulic fracturing) and horizontal drilling. The crisis in Crimea could make such energy security a permanent marker of a more peaceful world.
