EU’s Cold War With Russia Worries German Business

- Advertisement -

RHODES, Greece – German business, including some major energy companies, are frustrated that “the political war” between EU and Russia has become an “economic war that we’re going to lose,” a German source in Berlin with knowledge of the issue, told New Europe.

Relations between Russia and Germany are at their lowest for 40 years which worries German companies, the source said, criticising German Chancellor Angela Merkel for succumbing to pressure from the United States and East European states, turning a political crisis to an economic one.

The German source also noted that due to the outgoing European Commission’s actions, the Nord Stream pipeline carrying Russian gas to Germany is not operating at its full capacity because pipelines, which connect the Nord Stream pipe with other European countries, do not have third-party access exemption.

Brussels has also now suspended the approval process for the South Stream gas pipeline and is pressuring member states to cease pipeline construction. Russian gas monopoly Gazprom is spearheading the project which will bypass Ukraine.

Even with the EU suspension of the South Stream project, Italy, Austria, Croatia, and Germany continue to favour this pipeline. Austria recently approved the construction of the South Stream within its borders. Besides Gazprom, the key players in this project are Italy’s ENI, Germany’s Wintershall, France’s EDF, and Austria’s OMV.

Former Secretary General of the Council of Europe Walter Schwimmer ruled out the possibility of a new gas war. The Austrian politician told New Europe on September 26 that first of all, Russia knows “it needs friends in Europe”.

Secondly, Russia’s troubled economy is heavily dependent on oil and gas exports, Schwimmer said, speaking on the sidelines of the forum “Dialogue of Civilizations”. “Starting a gas war would damage Russian economy much more,” he said, adding that “Austrian providers guaranteed to the public that they can come over the winter at anytime. In any way, I still hope this spiral situation will stop”.

The EU is looking to diversify its oil and gas resources away from Russia. But Schwimmer said Europe will never be independent from outside energy resources. He noted that Europe is developing alternative energy – wind, solar, geothermic – to battle climate change. “But regarding oil and gas, we will always depend – if it is not Russia, it is northern Africa, it is Middle East and these are not the safest sources,” he said.

At the same forum, Matthias Platzeck, former Social Democratic Party leader and German-Russian Forum chairman, told New Europe on September 26 that he hopes the European Commission will help improve EU-Russia ties.

He reminded that his countryman, EU Energy Commissioner Günther Oettinger, “is at this moment negotiating in Berlin with Ukraine and Russia energy ministers”.

Russian, Ukrainian and European officials met in Berlin in an effort to avert a gas crisis for the upcoming winter. Oettinger reportedly proposed a deal that would see Ukraine repay some of its gas debt to Russia in exchange for guaranteed gas deliveries over the harsh winter months.

Schwimmer told New Europe that it is understandable that Russia has no reason to give a large discount to Ukraine. But if Russia’s Gazprom does not supply Kiev with gas “Ukrainian people will freeze in the coming winter and Russia will be blamed for it”.

Follow on twitter @energyinsider

Previously on Energy Insider:

Serbia Says Bets Off For South Stream

Lifting US Oil Export Ban to Hurt Putin

Former US Senators Lobby For Gazprom

 

- Advertisement -

Subscribe to our newsletter

Co-founder / Director of Energy & Climate Policy and Security at NE Global Media

Latest

On the two-year anniversary, G7 Foreign Ministers address the devastating war in Sudan

After nearly 23 months of war, on March 21,...

Doom, gloom or boom?

While it is an almost painful daily task to...

Don't miss

On the two-year anniversary, G7 Foreign Ministers address the devastating war in Sudan

After nearly 23 months of war, on March 21,...

Doom, gloom or boom?

While it is an almost painful daily task to...

Romania utilizing all available resources to boost its energy independence

Romania is using all energy resources available, including natural...

Ahead of nuclear talks, Trump administration orders new sanctions on Iran’s shadow fleet and Chinese refiners

Washington’s sanctions campaign of “maximum pressure on Iran” is intensifying, despite the start of initial discussions between the U.S. and Iran over nuclear issues...

Romania utilizing all available resources to boost its energy independence

Romania is using all energy resources available, including natural gas as the country advances rapidly with Neptun Deep gas project and new wind and...

Apollo Funds to partner with BP on TANAP gas pipeline from Azerbaijan to Turkey

British energy company BP said on March 21 it has reached agreements for Apollo-managed funds to purchase a 25 percent non-controlling stake in BP...

Caspian-Black Sea Green Energy Corridor countries push project forward

The Ministers of Azerbaijan, Georgia, Hungary and Romania met in Budapest on March 10, where they signed a joint letter to EU Energy Commissioner...

Ignoring Russia, latest Trump administration Iran sanctions increase pressure on an old enemy

On March 13, the Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned (“designated” in OFAC language) Iran’s Minister of Petroleum, Mohsen...

EU signs critical raw materials, energy and infrastructure deals with Kazakhstan

As part of the visit of EU Commissioner for International Partnerships Jozef Síkela to Astana, the European Union and Kazakhstan signed on March 13...

Weaning Europe off its Russian gas addiction

The Viking hero Ragnar Lodbrok once said “don't waste your time looking back. You're not going that way.” The words of the former king...

EU-Kazakhstan boost cooperation in energy, raw materials, transport, sustainability

The European Union and Kazakhstan have discussed at a meeting in Brussels the successful implementation of the Memorandum of Understanding between the Central Asian...