Russian President Vladimir Putin miscalculated last weekend when he cut off natural gas supplies to Ukraine over a price dispute.
The singular act of bullying also curtailed gas shipments to several European countries, incurring the wrath of nations like Germany, Austria and Hungary. Residents needed the fuel in the midst of freezing temperatures, and European governments were quick to raise a ruckus.
Putin’s decision to play hardball with Russian energy sources raises global concerns about whether his country is a reliable energy supplier. This puts Russia in a shaky position as it prepares to take the helm of the Group of Eight wealthiest industrialized nations this year.
Putin is already under suspicion for steps he’s taken to assert control over Russian political and commercial freedoms. After this weekend, his energy policies will be called into question.
The squabble erupted after Russia demanded a fourfold increase in the price Ukraine pays for natural gas, from $50 per 1,000 cubic meters to $230, which is closer to the $240 paid by the European Union. After Ukraine rejected the price hike, Russia’s state-owned gas company Gazprom cut the shipments. Russian gas pipelines to Europe run through Ukraine and supply about a quarter of Europe’s natural gas. Russia claimed that Ukraine siphoned the gas meant for Europe. (Ukraine says it is only taking gas it bought from Turkmenistan, from the pipelines crossing its territory.)
Russia says it wants to put an end to preferential gas prices for Ukraine and its other neighbors that have been in place since the Soviet Union collapsed in 1991. But it is not raising prices for its other neighbors as steeply, and a gradual increase could have been more palatable.
Putin may be acting from both political and economic motives. His action comes across as a clumsy attempt to undermine Ukraine’s pro-Western president Victor Yushchenko, who is seeking closer ties with Europe and a more distant relationship with Russia. He is up for re-election in March and faces a challenge from Moscow-backed candidate Viktor Yanukovich. Some Russian analysts speculate that Putin is also seeking to gain influence from his country’s growing energy wealth.
Yushchenko is seeking international arbitration to resolve the price dispute. European Union officials have called a meeting for today to discuss energy security in light of Russia’s actions. Europeans need to stand firm against Putin. The United States rightly criticized Russia’s action and needs to stand with Europe.
