Well, the end of another year is quickly approaching, which means one thing for all us Russia watchers:  time for another natural gas war.  Will it be Belarus again this year?  Nope, it looks like the clever Lukashenko has danced his way out from under Gazprom once again.  The Ukraine is exactly back to where they were in 2006, however with less money to pay the tab and a greater PR effort from Russia to help Europe brace itself mentally for the cut-off (maybe they learned something about preemptive diplomacy from the Georgia misadventure?).  Meanwhile for the rest of Gazprom’s customers in Europe, the message from Russia is clear:  “Costs of exploration, gas production and transportation are going up — it means the industry’s development costs will skyrocket. (…) The time of cheap energy resources, cheap gas is surely coming to an end,” PM Vladimir Putin said today during a meeting of the much-discussed gas cartel.

Industry analysts may be puzzled by the frosty bluster of these threats from the sidelines of the Gas Exporting Countries Forum (GECF), which includes 16 states such as Algeria, Iran, Qatar, Venezuela, Indonesia, Nigeria and others.  After all, there were similar appearances of an intent to manipulate the market when Russia sent Igor Sechin as an observer to the last OPEC meetings along with vague promises of a voluntary slashing of production.  However in the end, the Russians declined to go along with the OPEC, frustrating several other members and perhaps raising some problems in the mutual cooperation on pricing coordination for natural gas.  Will the new, emboldened GECF also be just talk, or action?

Regardless, both the upcoming potential supply cut to the West and the growing monopolization of the oil and gas market place an increased emphasis on the region’s most highly prized resource trophy:  Central Asia (for example, the central dispute in the Ukraine revolves around the non-transparency of the Russo-Turkmen gas trade).  Earlier this week, the journalist John Daly published an impressive survey on the energy politics and business issues of the region over at World Politics Review, which is well worth a read.  After the cut, an excerpt.