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“The situation is much worse than everyone thinks.” Alan Riley is drinking tea in the courtyard of the Radisson Hotel in the center of Chisinau, the capital of Moldova.
“The recent energy crisis this winter was extraordinary. “And now we understand why Russia initially forced Europe to take such a soft stance on the possibility of war.”
If Riley, a member of the Global Energy Center at the Atlantic Council think tank, is correct, Putin’s tactics could quickly bear fruit. The cost of gas and electricity in Britain could soon reach 3,000 pounds a month, in Germany 3,400 euros a month, in France 2,800 euros, and just under 2,000 euros in Italy and Spain.
The story of EU support for Russian gas was completely avoidable, and consequently very frustrating. By 2013, only 25 percent of Europe’s natural gas imports came from Russia. But Europe – and not for the first time – did the Kremlin a favor. The long public anti-nuclear sentiment in Germany, reinforced by Fukushima’s nuclear disaster in Japan in 2011, prompted Berlin to formally abandon its use of nuclear energy.
Meanwhile, a series of earthquakes around the Groningen gas field in the Netherlands – the largest in Europe, at 2.740 billion cubic meters of natural gas – prompted Dutch authorities to decide to cut production last year.
It was a “perfect storm” of short-sightedness and bad governance, as well as revanchist desires in Moscow, that eventually plunged the continent into Ukraine’s battlefield. For all this there is a deep and very widespread anger. Ukrainians are grateful for all the help the West is giving them.
But at the same time they rush to mention EU foreign policy chief Josep Borrell, who earlier this month said that while Brussels has given Ukraine 1 billion euros in foreign aid since the start of the war , as it paid Moscow 35 billion euros in energy.
They can not understand how Brussels is happy to help Ukraine, and at the same time pay for the Russian war machine. In an office in downtown Odessa, I met Panteleimon Bumburas, a local businessman, and honorary consul of Crimea and Kherson.
“All the problems started when the Russian Federation started earning more than 1 billion euros a day because of Angela Merkel’s actions,” he told me. “Believe me,” a citizen of Odessa recently told me while drinking tea. “In Russia you can not rely on anything,” he added.
Anyway we Europeans are doing this, and the citizens still do not understand the reason.
Riley says: “What the Russians did last spring was to prepare for war. What normally happens is that in the spring Europe imports low-priced gas, which it stores in warehouses. This creates winter reserves.
At the time, I noticed two things. First, that this was not happening; and second, the Russians were not selling additional quantities of gas on the market. If it does not, the price goes up, and so does the price of long-term contracts. “At this point, higher energy bills are inevitable for ordinary people.”
Riley thought it was an attempt by Moscow to impose German certification on the Nord Stream II pipeline, for which the United States was pressuring the latter not to cancel, at least delay, its installation. In work.
But he was wrong. “I understand now that this was an attempt to soften the EU, on the eve of the start of the war in Ukraine, to ensure that it would not side with Ukraine.”
Putin could not have been clearer than that: if the behavior of European countries were to change, Moscow knew it would invade Ukraine last spring; and was happy to send millions of Ukrainians across a European continent, which would plunge into a deep energy crisis.
So this was an attack not only against Ukraine, but against all of us. Riley identifies another problem. “We encountered many difficulties in other aspects as well. The whole climate change agenda has dulled the voice of the energy industry, which is not always heard. But the fact is that we knew these things. “And our warnings went unnoticed, and energy prices started to rise.”
To some extent, the world has been facing rising energy prices since last spring, largely due to rising Chinese demand, as industrial production there returned to pre-Covid levels to meet renewed demand. of the consumer.
But what we are seeing is not normal. Gas prices in Europe usually vary between 150-500 dollars per 1000 cubic meters. Now the cost is $ 1000 per cubic meter. This, Riley tells me, is the effect of the Russian company Gazprom. “Half of Europe’s gas shortages can be directly attributed to Gazprom’s deliberate depletion of gas deposits in the EU,” he said.
Of course, we in Britain are much less interdependent on Russian gas. While the EU imports about 40 percent of its gas from Russia, the UK buys less than 5 percent of its gas and oil from Russia. But they are all connected to the same market, so the lack of gas brings again the rise of its prices.
Addiction is always a curse. To understand how much, take the case of the United States, which has its own shale gas, so today they pay 10 times less than Europe for energy. As long as we continue to rely on Russian gas, these problems will continue.
Riley believes a solution could be to fully tax what we pay Russia for its energy, making it much more difficult for the Russian war machine to function. In this respect Moscow is very vulnerable.
If once it was not exactly a petro-state (dependent mainly on oil sales revenues), after Western sanctions it has become almost an economy with a single industry. But even with the imposition of this tax, it may be too late.
“The suffering of people in Britain and across Europe because of high energy bills is a direct result of Russia’s preparation for war,” Riley told me as he finished his tea. He stops and then looks at me with a tired smile. “Gazprom turned out to be much more effective in implementing war plans than the Russian army itself,” he concluded./bota.al
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