... distribution of economic capabilities in the near future will be vital as unless asymmetry is lessened, this relationship may not get very far, as asymmetry breeds conflict.
Counter-Agent Dilemma & Subsidized Gas/Oil to China:
The publicised and agreed energy deals with China are currently at the break-even point or just above it, which comparatively puts them on par with expensive Australian projects. If the market conditions do not worsen, these projects will recuperate their costs, but if there is a shift in the business ...
... hope to share some of the findings and research conducted. In this first post of two-part special, a Europe-Russia focused question and answer session is outlined with Dr. Tatiana Mitrova, whereas in the subsequent second post, coming later, we look at China-Russia.
Europe-Russia ‘Special Deal Severed’:
In normal day-to-day life Europe has a stable and diversified supply structure. It is currently doing enough to diversify its supplies so it does not undermine its energy security, but for a region which will dependent on imports for 80% (some sources even indicate 88-90%) of its energy needs by 2025-2030, it will naturally be more susceptible to risks. Any setbacks, or sudden events, ala Fukushima or Arab Spring ...
... Fukuyama predicted in The End of History), we are seeing the rise of old empires and new elites who in the case of Russia (and China) combine elements of bureaucratic capitalism with aspects of authoritarian plutocracy. That is why critical engagement at ... ... experts – like the Russian International Affairs Council – is so crucial.
Is Europe undermining its own energy security by attempting to diversify away from Russia?
That’s absolutely right. Amid the anarchy of the Arab Spring,...
... differ a lot, particularly when Russia aims to receive European type sums. Mareš and Laryš argue that China’s gas market is a questionable venture, as it is traditionally orientated towards coal with gas only account for 3% of the energy mix. China has begun to move towards natural gas only 10 years ago. It is estimated that the overall total will rise to around 10% by 2020, but with increasing competition and Beijing’s strategy of diversifying imports as much as possible, it is uncertain ...
..., its growth has been very rapid. China has single-handedly fuelled more demand for LNG and expanded not only in its domestic, but also in international markets, like Africa (See: NYT). I was personally excited about opportunities between Russia and China, as Energy Minister Alexander Novak, issued a statement that both were working on gas and oil deals prior to Xi's arrival (See: Prime). I even hoped to discuss these issues with Novak personally, at "The Russian Energy Conference", which ...
... the US argue it should be aimed predominantly at the home market.
Non-US Shale Progress (Europe and Asia):
China is eager to jump on the Shale Revolution and aims to produce 100 billion cubic meters by 2015. Firms like Shell, Chevron, Chesapeake Energy and Devon already participate in Asia through joint partnerships – as China’s command economy forbids free market interaction. However, as Wood Mackenzie analysts in The New Times article point out, such target is unrealistic as China has a complex geological frame, it lacks water for fraking (hydraulic fracturing ...
... to antagonise Russia, as it understands that Central Asia is Russia’s region traditionally. Further, I think there will be a lot of scope for both countries working together and brining in other smaller states on key issues of security, trade, energy and so on. However, again it is difficult not to see China as the leading player due to its economic strength.
What kind of foreign and economic policy (i.e. energy policy) will the Central Asian states apply in regards to relations with Russia and China?
It will be a trend that has been already set....
... efficiency increases. As an example, modern cars are a lot more powerful today than ever, but due to new efficiency designs, they only require an equivalent to the notably less powerful cars of the 1960’s to 1980’s. Moreover, albeit global energy intensity has fallen globally (even China and Russia has improved) due to technological innovation within efficiency, nonetheless it is unlikely to fall further as the opportunity cost for the next stage of efficiency is too high. Lastly, in regards to developing economies the demand is ...
... Gas Dialogue: Russian Gas in the European Market» Joint International Forum held at IMEMO RAN conference hall on 7th December 2012; moderated by Ivanova N. I., RAN Academic and Associate Director of IMEMO RAN, and Eric Dam, General Director of Energy Delta Institute.
Optimism Remains Thin in the Air:
As the world continues to scuffle against the most severe economic crisis, optimism remains thin in the air, conceivably as uncertainty is easier to sell. The IMEMO RAN forum was no different,...
... offsets the cost for gas from the current $400 per 1000 cubic meters, it could begin to lose market share – which has not changed in the last decade. The decision must be well calculated, yet quick, as USA has almost achieved independence from energy imports due to shale which could supply North America, Australian shale could supply Asia, Israel has off-shore shale potential, Middle East could make a stable return to supply Europe and if China gets the technological means it may mine its shale reserves which are the biggest in the world. Realistically, Russia cannot compete with shale prices as US trades at $70 per 1000 cubic meters, Australia at $120-$140 and Algeria and Qatar sell natural ...
