Gas Wars: The Future of European Energy Security and the Fate of the Green Deal

By Connor Bryant, Policy Briefs Writer

Image credit: Bloomberg

Even as the Russo-Ukrainian War enters its ninth year, Europe continues to rely on Russian natural gas and finds itself in the midst of an energy crisis. This dependence represents a powerful lever of Russian influence and hampers a cohesive Western response to the Kremlin’s aggression abroad, especially in Ukraine. Europe’s reliance on Russian natural gas puts it in a difficult position. European states can either appease Russian aggression or take a stronger stance against Russia and undermine their own economic security in the process. On the surface, it seems like a losing scenario.

Russia is Europe’s largest energy supplier. Though this is true for both oil and natural gas, the rigid pipeline infrastructure associated with the latter has turned it one of the greatest points of contention in EU-Russia relations. In 2019 Russia supplied 41.1% of the EU’s natural gas. Meanwhile, the largest importer of Russian gas is Germany, Europe’s largest economy, which imported 65.2% of its gas from Russia.

Despite importing substantial volumes from Russia, Germany wants more. The Nord Stream 2 pipeline connecting Russia to Germany — completed late last year — remains a source of tension between Washington and Central and Eastern European states on the one hand, and Berlin on the other. According to Washington, the pipeline allows Moscow to circumvent Ukraine — traditionally a key transit country — and to thereby pressure Kyiv and other neighbouring states without jeopardising access to the crucial German market. In contrast, members of the German government continue to insist that Nord Stream is a purely commercial project.

Even amidst heightened tensions with Moscow, Berlin is reluctant to terminate the project. Though President Joe Biden has stated that a renewed invasion of Ukraine would kill the pipeline, German officials remain ambiguous, alluding only to the possibility of keeping the pipeline idle. This reluctance has inhibited a united deterrent against Russia, as Berlin has consistently sought to dilute any further sanctions against Russia.

The energy supply and price crisis in which Europe finds itself — largely a result of reduced Russian gas deliveries — is a glimpse of what’s to come. As the prospect of a renewed war in Ukraine and further supply shocks loom large over the continent, Western leaders have set in motion contingency planning. Instead of turning to another large supplier, Europe will have to find a number of smaller ones. One candidate is Qatar, which recently met with the Biden administration to discuss the matter. It is unclear if numerous smaller suppliers will be able to completely fill the vacuum left by Russia, but it is likely they will be able to cover much, if not most, of it.

This isn’t without its own difficulties, however. Given Russia’s share in the European gas market, countries like Qatar and the United States will need to extract more gas and prioritise some buyers over others. These problems are compounded by the logistical difficulties of transporting that much gas to the EU.

In light of Europe’s transition to renewable energy, dependence on Russian energy has a theoretical time limit. But before these plans come to fruition, Europe will become more dependent on Russian energy exports in the medium-term as sources, like coal and nuclear power, are being phased out.

Should fears of a conflict with Russia materialise, it’s likely that energy security concerns will take precedence over the transition, and the EU will be forced to leave decarbonisation on the back-burner. If, for instance, the EU fails to acquire alternative supplies, it may need to resume domestic fossil energy production. These are contingency plans which the EU must prioritise to the highest degree — not only for the sake of its own energy security, but for the deterring Russia from another invasion of Ukraine which makes such plans necessary to start with. In all, the Kremlin’s loss of gas as a major economic weapon might well be what shifts its cost-benefit analysis away from war.

European Horizons welcomes open and innovative analysis on relevant and occasionally controversial transatlantic issues. The viewpoints expressed in Transatlantic Perspectives do not necessarily reflect an institutional position.

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