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Russia Vs Ukraine: oil and gas
Behind the geopolitics pitting Russia against the West and the ethnic tensions tearing Ukraine east and west another backdrop for understanding this deepening conflict is the big-money competition for Ukraine's oil and natural gas.
Ukraine has Europe's third-largest shale gas reserves at 42 trillion cubic feet,according to the U.S. Energy Information Administration
Russia's state-owned Gazprom, controlling nearly one-fifth of the world's gas reserves, supplies more than half of Ukraine's gas annually, and about 30 percent of Europe's. It has often used this as political and economic leverage over Kiev and Brussels, cutting gas supplies repeatedly over the past decade (in the winters of 2005-2006, 2007-2008, and again in 2008-2009), leading to energy shortages not only in Ukraine, but Western European countries as well. This leverage, however, came under challenge in 2013 as Ukraine took steps towards breaking its dependence on Russian gas. On Nov. 5, 2013 (just a few weeks before the Maidan demonstrations began in Kiev), Chevron signed a 50-year agreement with the Ukrainian government to develop oil and gas in western Ukraine. Read more My conjecture: If Ukraine was to become a major gas and oil exporters would they then be in position to use the pipelines already in place to supply Europe etc?
Disclaimer: The author of this post, may or may not be a shareholder of any of the companies mentioned in this column. No company mentioned has sponsored or paid for this content. Comments on this forum should never be taken as investment advice. |
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Russia cuts off gas supplies to Ukraine
I just read this article on the Financial Review App for iPad and thought you might be interested in it.JUNE 18, 2014
Russia cuts off gas supplies to Ukraine MICHAEL BIRNBAUM AND CAROL MORELLO Moscow Russia cut off gas supplies to Ukraine on Tuesday, a move that will inflict immediate pain on its turbulent neighbour and could eventually affect other gas-reliant European nations. The cut-off intensifies pressure on Ukraine, which is contending with an increasingly violent pro-Russian *insurgency in its east and with economic challenges that were crippling even before the upheaval sparked by the ouster of Kremlin-friendly president Viktor Yanukovych in February. And if the gas flow is halted for a long time, winter stockpiles across Europe could be depleted, causing problems across the continent, particularly in eastern European nations that depend solely on Russia for their gas. Russia's giant gas company, Gazprom, said on Tuesday it had notified the European Commission of possible shortfalls after the cut-off. About 15 per cent of Europe's natural gas supplies cross Ukrainian territory. Long battle looms The two sides appeared to be readying for a long battle. The head of Ukraine's state-owned natural gas company said it could go without new supplies until December, if necessary. "We will supply gas only in the amount paid for," Gazprom spokesman Sergey Kupriyanov said in explaining the action against Ukraine. "They paid zero; correspondingly, it's zero." Russian Prime Minister Dmitry Medvedev called the Ukrainian refusal to pay its gas debts in full "blackmail". Ukrainian Prime Minister Arseny Yatsenyuk said he was not interested in accepting higher prices for Russian energy only to allow Russia to "spend this money on weapons, tanks and planes to bomb Ukrainian territory"; a charge the Kremlin has denied.
Disclaimer: The author of this post, may or may not be a shareholder of any of the companies mentioned in this column. No company mentioned has sponsored or paid for this content. Comments on this forum should never be taken as investment advice. |
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