Russia's seizure of the Crimea and its threat to cut off gas to Ukraine, a transit route to the rest of Europe, have revived calls to reduce the EU's reliance on Moscow for energy, but the blocs options are limited and costly. [
The European Union made some progress in improving its energy security after rows over unpaid gas bills between Kiev and Moscow led to the disruption of supplies to western Europe in 2006 and 2009.
By improving its pipeline network, the EU is better prepared for a new supply disruption, but it has not managed to reduce Russia's share of European energy supplies.
Russia today is Europe's biggest supplier of oil, coal and natural gas, meeting around a third of demand for all those fuels, according to Eurostat data, and receiving in return a thumping $250 billion a year.
European leaders said on Friday that the stand-off with Moscow over Crimea made them more determined than ever to end decades of dependence on Russian gas, but they will have to work hard to convince the sceptics.
"The curious feature of the energy policy that emerged from the middle of the last decade is just how little serious effort has been put into security - in particular Eastern security," said Dieter Helm of Oxford University in a research paper this week.
While buyers can switch oil and coal suppliers relatively quickly and easily, Europe receives most of its gas through pipelines that are fed by only one supplier, chief among them Russia's state-controlled Gazprom.
"Gazprom's market share in Europe is increasing (due to decline of European production). So the aim of diversification of our supply is not going to be achieved this side of 2020," said Thierry Bros, gas analyst at French Bank Societe Generale.
"The question of diversification of supply post 2020, what is now in discussion in Brussels, is going to be very difficult to achieve, as with (gas) prices just below $10 per million British thermal units (mmBtu), Russia is making alternative developments for Europe less profitable," he added.
Source: Reuters
The European Union made some progress in improving its energy security after rows over unpaid gas bills between Kiev and Moscow led to the disruption of supplies to western Europe in 2006 and 2009.
By improving its pipeline network, the EU is better prepared for a new supply disruption, but it has not managed to reduce Russia's share of European energy supplies.
Russia today is Europe's biggest supplier of oil, coal and natural gas, meeting around a third of demand for all those fuels, according to Eurostat data, and receiving in return a thumping $250 billion a year.
European leaders said on Friday that the stand-off with Moscow over Crimea made them more determined than ever to end decades of dependence on Russian gas, but they will have to work hard to convince the sceptics.
"The curious feature of the energy policy that emerged from the middle of the last decade is just how little serious effort has been put into security - in particular Eastern security," said Dieter Helm of Oxford University in a research paper this week.
While buyers can switch oil and coal suppliers relatively quickly and easily, Europe receives most of its gas through pipelines that are fed by only one supplier, chief among them Russia's state-controlled Gazprom
"Gazprom's market share in Europe is increasing (due to decline of European production). So the aim of diversification of our supply is not going to be achieved this side of 2020," said Thierry Bros, gas analyst at French Bank Societe Generale.
"The question of diversification of supply post 2020, what is now in discussion in Brussels, is going to be very difficult to achieve, as with (gas) prices just below $10 per million British thermal units (mmBtu), Russia is making alternative developments for Europe less profitable," he added.
