EU – Russia energy deal

As the price of oil continues to dictate economic policy in EU countries, the European Union seeks alternatives, which start with Russia, on its Eastern border. Exploratory talks have already taken place between President Vladimir Putin, European Commission President, Romano Prodi and German Chancellor, Gerhard Schroeder, regarding a strategic energy partnership. The EU plan is to help Russia to gain investment for its huge oil and gas resources in return for a more stable source of energy for the EU countries. An energy statement is expected to be drawn up by the EU this week, formalising plans for a 20-year agreement with Russia to supply oil and gas. This would be very welcome among EU governments. A spokesman in Brussels said : “ It would help us to diversify our sources of energy and our dependence on oil”. For Russia, this agreement will guarantee twenty years of investment, guaranteeing continuing links with the EU. The EU has always seen Russia as a strategic partner, not only because Russia is a European country but also because of the huge resources Russia has. Gazprom has already been selling vast supplies of gas to Germany but Russia’s Siberian resources are still virtually untapped. The Yamal peninsula could be a very important source of energy to the EU if pipeline technology is made available. The EU would benefit from a secure supply of energy and Russia would benefit from a new source of high-technology investment and a long-term injection of hard currency.

Timothy BANCROFT-HINCHEY Correspondent of PRAVDA.Ru Lissabon