Friday, December 30, 2005

Russia Threatens To Cut Off Ukraine's Gas

As if to underscore the deep dodginess of Europe's energy supply - which is increasingly controlled by Russia - Gazprom, the state-controlled Russian energy company, has been threatening to cut off supplies to the Ukraine if it doesn't agree to an immediate fourfold increase in price.

Gazprom recently appointed ex-Chancellor Schroeder of Germany to a senior job, a reward for the way in which the tarnished German socialist politician pushed Gazprom's lucrative and controversial new pipeline deal through. In this new job, Schroeder is Putin's paid employee. The effect of the new pipeline, which is being subsidised by European taxpayers, will be to place European gas supplies at the mercy of Putin's Russia. The pipeline plan has raised much protest in Poland and the Ukraine, and it now looks as though Gazprom will be aiming to profit from increased prices across Europe.

The European Union, typically, has taken the line of least resistance, sided with the biggest political interests, and has said it would not intervene. And yet the EU - as well as the ex-Soviet states which Putin now punishes or rewards at will - would be far better advised to search out alternative sources of power, instead of placing itself at the mercy of the increasingly autocratic Putin.
Telegraph Money Russian gas war brinkmanship threatens higher energy costs in Britain

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