EU's prestige at risk in continuing gas crisis

By Stephen Castle and David Jolly

Thursday, January 15, 2009
BRUSSELS: More than a week after the European Union put its credibility on the line by intervening in an energy dispute between Russia and Ukraine, the diplomatic gamble has failed to get the gas flowing - damaging the prestige of the 27-nation bloc in the process.

But after eight days of hectic negotiating, exasperated Europeans now are resting their hopes for a breakthrough on a meeting Friday between Angela Merkel, the German chancellor, and the Russian prime minister, Vladimir Putin, in his first visit to Berlin since he stepped down as president last March.

Were this breakthrough to happen, though, it would only underline Russia's preference for dealing with big European nations individually rather than the EU, further undermining the tattered image of Brussels and the institutional machinery that relies on the rotating presidency, now held by the Czech Republic, to lead Europe's dealings with the rest of the world.

The dispute that has left Europe without most of its Russian gas supplies since last week continued Thursday for a ninth day, with Gazprom, the Russian gas monopoly, saying Ukraine had "again today refused to transit Russian gas to Europe through its export pipelines."

The Russian company said it had requested that the Ukrainian pipeline operator Naftogaz accept nearly 100 million cubic meters, or 3.5 billion cubic feet, of gas for export to Moldova, the Balkans and Slovakia, "but Ukraine has now declined on the grounds that there was not a technical agreement in place for gas transit throughout 2009."

It marked the third straight day that Gazprom has sought to send gas to Europe, though the amount was far less than the roughly 300 million cubic meters required for Europe at this time of year. And once again, Naftogaz declined, arguing that the Russian shipment would disrupt its domestic network.

On Thursday the European Commission announced that its energy commissioner, Andris Piebalgs, and the Czech energy minister, Martin Riman, would attend talks in Moscow on Saturday, provided the Russian and Ukrainian leadership were involved.

But since Russia had invited the president of the commission, José Manuel Barroso, the offer to send a less senior official reflects growing frustration with Moscow. Behind the scenes European officials, who helped broker a deal to put monitors into Ukraine and Russia, are increasingly critical of Russia.

"The Russians are not putting gas into multiple entry points as requested," said one EU official close to the negotiations. "And they are clearly not providing the level of supply needed for transit."

During the past week Barroso has made at least four calls to Putin and has also talked frequently to his Ukrainian counterpart, Yulia Tymoshenko. Mirek Topolanek, the Czech prime minister, has visited both Moscow and Kiev.

But Andrew Wilson, senior policy fellow and expert on Russia and Ukraine at the European Council on Foreign Relations, describes the EU's crisis management as "awful."

"Russia showed during the Georgia crisis," he said, "that it clearly has a preference for negotiation with big member states - in that case France and its presidency, Nicolas Sarkozy."

"Moscow was very rude," Wilson added, "even to accompanying EU diplomats, and has been very skeptical about the Czechs. They may be waiting for big member states to step in."

Jan Sliva, spokesman for the Czech presidency, rejected criticism of its handling of the crisis. "The question is being asked," Sliva said, "as to whether it takes a big member state to get involved. But the Czech Republic is holding its own and is doing what every big member state would do."

The EU's biggest asset is its size and the fact that, as the world's biggest trading bloc, it can exert considerable influence when united.

But with Brussels sputtering, the European efforts have begun to splinter. Bulgaria and Slovakia - two nations that have been particularly hard hit by the gas crisis - have voted with their feet by sending their own missions to Moscow even as they were careful not to contradict EU policy.

Slovakia has also tested the unity of the bloc by signaling its desire to restart a Soviet-vintage nuclear power station that it agreed to close as part of its agreement to join the EU.

In the long-term, the only positive outcome may be that the EU's very impotence will shake the bloc into action. For three years the EU has talked about producing a coherent energy policy without much to show for it.

"Clearly the crisis has helped to stiffen resolve," Wilson said, "on energy security, national action plans and energy interconnections between EU member states."