July 4, 2007

Russia’s Thirst for Oil

Russia has been single-minded in ensuring its hegemony over oil rights and delivery throughout Eastern Europe, and now seeks to edge out its American competitors in providing oil to Western Europe as well, say analysts.

Vladimir Putin shocked observers by announcing a plan to annex a 460,000 square mile chunk of oil-rich Arctic last week.

Russian scientists claim there is evidence showing that its northern Arctic region is connected to the North Pole by an underwater shelf.

Critics counter that Canada could make the same claim — and besides which, nobody owns the North Pole.

Putin also met with the leaders of eight Balkan countries to persuade them to back his new Italy-backed venture to build a gas pipeline under the Black sea from Russia to Bulgaria, saying it would benefit all of Europe.

Greece wants to take part in the project as a major oil port.

But Romania backed a Western pipeline that would transport gas from Central Asia and Iran and reduce dependence on Russian oil.

The E.U. has opposed Russia’s pipeline project, along with countries like Poland, who fear they would be bypassed in the supply chain.

Russia’s oil company, Gazprom, has clashed with Ukrainian officials over a stalled pipeline extension Ukraine hopes to complete, part of a vital distribution network to Europe that would ensure Ukraine’s oil security from price disputes with Russia.

Russia wants rights to the project, prompting the Ukrainian parliament to pass a law forbidding the transfer of ownership to another country.

Sources:

“Kremlin lays claim to huge chunk of oil-rich North Pole”
Guardian (U.K.), June 28, 2007

“Trust Russia on energy, Putin tells Balkan countries”
AFX News, June 24, 2007

“Greece to join South Stream gas pipeline project linking Russia with European customers”
Associated Press, June 26, 2007

“Russia/Ukraine: Pipeline conflict resurfaces”
RFE/RL, June 28, 2007

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