THE ENERGY BALANCE, KRAKOW-STYLE

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New energy alliance formed in Eastern Europe

A summit in Krakow, closing on May 12 and attended by the presidents of Ukraine, Azerbaijan, Georgia, Lithuania, and Poland, resulted in the formation of a political bloc to counter an energy alliance being formed in Ashgabat by Russia, Kazakhstan, and Turkmenistan.


A summit in Krakow, closing on May 12 and attended by the presidents of Ukraine, Azerbaijan, Georgia, Lithuania, and Poland, resulted in the formation of a political bloc to counter an energy alliance being formed in Ashgabat by Russia, Kazakhstan, and Turkmenistan. The western energy bloc will hold its second summit in Vilnius this autumn. It will discuss the Odessa-Gdansk pipeline, which the Krakow summit decided to build, and the whole range of enery issues concerning hydrocarbon supplies to the European Union from Russia, the Trans-Caucasus, and Central Asia.

In formal terms, President Vladimir Putin’s visit to Kazakhstan and Turkmenistan last week was a response to the energy summit convened by several former Soviet and Warsaw Pact countries in Krakow, Poland. The invitations to this seven-nation energy summit were sent out two months in advance, but President Putin’s actions changed the meeting’s format – only five heads of state attended, not seven.

Polish President Lech Kaczynski received Ukrainian President Viktor Yushchenko and Georgian President Mikhail Saakashvili on the evening of May 10; Azeri President Ilham Aliyev and Lithuanian President Valdas Adamkus arrived in Krakow on May 11. But President Gurbanguly Berdymukhammedov of Turkmenistan and President Nursultan Nazarbayev of Kazakhstan chose to stay home and meet with President Putin. True, Nazarbayev took the precaution of sending Energy Ministry official Lyazzat Kiinov to Krakow as Kazakhstan’s representative, so the summit communique was issued in the name of six countries.

The communique, dated May 13, states that an energy bloc has been formed by several states which are united by a common approach to energy policy. The presidents of the nations involved will meet regularly; the next meeting is scheduled for October 2007 in Vilnius. Between now and then, the six participant countries will set up inter-state working groups on key issues in energy policy, including the question of establishing a consortium to extend the Odessa-Brody oil pipeline to Gdansk.

Lithuanian President Valdas Adamkus provided the most comprehensive explanation of the idea behind the western energy bloc: “When economic independence and energy independence become important national security criteria, energy becomes inseparable from international relations and diplomacy. Recent events have shown that manipulation of oil and gas supplies… has a perceptible impact on people and their daily lives.” Adamkus was referring to the Russian-Ukrainian gas wars in 2004-05. Therefore, he said, “the time has come to start seriously seeking alternative sources of oil and gas from the East, free of political dependence.”

At this stage, the new energy bloc is primarily a bloc of oil transit and oil consumer countries. Although the Krakow communique was signed by representatives of oil-and-gas producers Kazakhstan and Azerbaijan, there is no guarantee that they will contribute oil and gas to the bloc’s projects. The rhetoric used by Azeri President Ilham Aliyev at the summit was exactly the same as the rhetoric used by the presidents of Turkmenistan and Kazakhstan, speaking on the same day 3,000 kilometers from Krakow. Aliyev attributed his participation in the energy bloc to the need to diversify oil and gas supplies. Note that Russia’s style in energy policy has been adopted by others: almost all the presidents talked of energy security, but what they meant was their own security against Russia’s actions in the energy sector.

Ukrainian President Viktor Yushchenko called on the bloc to agree on a common energy strategy: “None of our countries have a self-sufficient energy policy at present.” This common energy strategy will largely be an alternative to the energy policies of Russia and the European Union (to be discussed at the EU-Russia summit in Samara on May 17). So far, however, the United States hasn’t expressed any visible support for the western energy bloc. Thus, the prospects of this alliance depend on whether other EU countries join it: the summit participans stated that their bloc is open to new members.

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