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Russia’s natural gas machinations are worrisome

From the Kansas City Star:

Bullying of Belarus could affect Europe – Russia’s natural gas machinations are worrisome – The Kansas City Star The recent natural-gas supply deal between Belarus and the Russian gas monopoly, Gazprom, should be seen as a clear warning for Europe. Russia, an important supplier of European gas, is becoming increasingly imperious. Last year, the Russians cut off gas deliveries to Ukraine and demanded a price increase, even though contract provisions obligated Gazprom to maintain pricing until 2009. In the negotiations with Belarus there was no cutoff, but the threat was implicit. Belarus must now pay more than double, with prices rising in the later years of the five-year contract. Gazprom says the move is only an attempt to impose market pricing and end the natural gas subsidies that had been granted to former Soviet republics. But in supplying countries such as Belarus, Ukraine or Georgia, Gazprom has little or no competition. It is a behemoth monopoly virtually run by the Kremlin, so the notion of a market price for the gas it pumps to Belarus and other countries makes no sense. Another aspect of the Belarus deal is also troubling: Gazprom gained control of the monopoly that distributes gas throughout Belarus. Gazprom is also trying to gain control of pipelines within the EU — and after its bullying of Belarus, the Europeans ought to take notice. Twenty percent of Europe’s gas flows through Belarus, and some also flows through Ukraine. The worrisome long-term question for Europe is how to avoid having a significant chunk of its energy supplies taken hostage by the Kremlin in some future foreign-policy dispute.