New book: Energy issue key to crisis in Ukraine
9 May 2014
The energy issue, specifically trade in natural gas, has affected the conflict and developments in Ukraine and Russia more than is generally known. This is the view of Stefan Hedlund, a researcher at the Centre for Russian and Eurasian Studies, Uppsala University, Sweden, who has just published a book that addresses the very core of this highly topical subject.
- Very few people understand how central energy matters have been for the course of events, says Stefan Hedlund, professor at the Centre for Russian and Eurasian Studies, Uppsala University.
Ever since the collapse of the Soviet Union, energy has been a sensitive and constantly topical issue in relations between Russia and Ukraine. What is often called ‘Russian’ gas, which is sold to customers in Europe, has actually been gas from Central Asia, primarily Turkmenistan, that is transported via Russia and Ukraine.
This trade has been marked by serious corruption, which has had a very negative impact on the formation of the Ukrainian state. Conflicts between Moscow and Kiev regarding the pricing of the gas that is to pass through Ukraine from Russia has sometimes led to disruptions in the supply. Twice – in 2006 and 2009 – this has also affected customers in the EU. Now that the crisis in Ukraine is escalating, the threat of a new “gas war” is growing. Kiev has a major debt, the equivalent of some USD 3.5 billion, to the huge Russian company Gazprom which the country is not able to pay back. If the company shuts down the flow of gas to Ukraine, it will impact several EU states.
- Russia’s minister of industry recently informed Ukraine that the debt must be paid before 16 May, after which date they will have to pay in advance if they want any gas. Ukraine will not be able to pay its debts. The IMF will only lend them the money if the disintegration of the country is halted. It clearly does not look good for Ukraine, and therefore not for the relations between Russia and the West either, says Stefan Hedlund.