Sunday January 15, 2006

Ukraine gas dispute warning of conflict to come

peakoil.com -> business.guardian.co.uk :

The Ukraine gas dispute is a warning of conflict to come as energy supplies fall short. Vladimir Putin had barely taken over the G8 presidency before he was turning off gas supplies to Ukraine. Of course, Putin's argument that he was simply asking Ukraine to pay a market price for its gas was spurious. The message was clear: "don't mess with me". The only reason Russia is a member of the G8 is because it is sitting on the world's biggest reserves of natural gas. Putin has made his point and the G8 will get the message.

Europe's vulnerability is that it receives a quarter of its natural gas from Russia, with Hungary, Austria and the Czech Republic especially vulnerable, as most of it arrives via a pipeline that crosses Ukraine. When Russia reduced the gas by the amount it normally supplies to Ukraine, there was nothing to prevent the Ukrainians from siphoning off some for themselves, leaving Europe short.

Concerns about the British government's energy policy are growing. Labour backbencher Colin Challen has introduced a bill calling for the contraction and convergence method for tackling climate change to be enshrined in law. C&C involves reducing greenhouse gases to a sustainable level over the next few decades (contraction) and over the same period arriving at a situation where everybody on the planet has an equal right to pollute (convergence). There is not much hope that the government will adopt his bill, but it should.

Instead, we're scrabbling around looking for a quick fix - urging Opec to pump more oil, building more nuclear power stations, occupying Iraq - in the hope that there is a magic solution to the problem of ever-rising demand and limited supply. There isn't. Russia's skirmish with Ukraine will be merely the foretaste of bigger and nastier conflicts over energy unless it is recognised that the party is over and the days of cheap oil and gas are gone for good.

See also :

1. Russia, Ukraine reach breakthrough deal ending gas war
2. North Sea gas drying up faster than hoped
3. UK Oil Production Down 12.8%

(2006-01-15 22:51:49 SGT) [Energy] Permalink

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