Without Russia, Europe Needs Energy: Can the U.S. Help?
Russia’s economic power over Ukraine and Europe lies in their reliance on its gas export industry. As a result, the United States is considering the argument on Tuesday that those restrictions it currently has placed on its own natural gas exports should be relaxed somewhat, according to Reuters, so as to help ease the energy concerns Europe and Ukraine are facing in light of the conflict with Russia.
Russian troops have invaded regions of Crimea, a Ukrainian peninsula, specifically taking over militarily significant ports and creating international tension over claim on the territory. A recent referendum — held under military occupation — resulted in a heavy majority vote from Crimean citizens for independence from Ukraine to join with Russia. Its application for annexation was accepted by Russia, despite the continued emphasis from the West and Ukraine that neither the referendum nor any annexation is legitimate or legal.
As relations with Moscow have become more troubled, concerns over energy have grown, bringing new emphasis on the U.S. energy policy. At present, potential exports must first be reviewed by the U.S. Department of Energy with the exception of a select few countries that have free trade agreements with the U.S. The suggestion that more gas be exported to relieve European concerns has led critics to voice concerns that this could adversely affect the gas price within the United States. Both the House and Senate energy committees will consider the proposal.
“While our government does not dictate where that supply will go, it does control how fast we will connect to the global market,” is what David Goldwyn, senior fellow at Brookings Institution, plans to tell the Senate Energy Committee on Tuesday, according to Reuters.
Others are hesitant to take any risks when it comes to the American economy. “There is certainly no good reason why the U.S. should undertake a domestic LNG export policy that has numerous downsides for the American gas consumers when many of the very countries we are seeking to help are capable of helping themselves by accessing their own domestic shale gas reserves,” is what Dave Schryver, executive vice president of the American Public Gas Association, plans to tell the House’s Energy Committee — reports Reuters.
The importance of the discussion is highlighted by Russia’s Monday removal from the Group of 8 industrialized democracies amidst continued threats of further sanctions from the West. The nations — Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States — joined in making the Hague Declaration in which they re-stated their support of “Ukraine’s sovereignty, territorial integrity, and independence” as well as “strongly condemn Russia’s illegal attempt to annex Crimea in contravention of international law and specific international obligation.”
The group’s declaration also addressed the gas issue, saying that, “We have decided that G-7 Energy Ministers will meet to discuss ways to strengthen our collective energy security,” while also announcing their cancellation of the April meeting planned in Moscow between the G8′s Foreign Ministers. The U.S. changing its restriction could be just one step towards achieving that goal, though at present Congressional outcome is uncertain.
More From Wall St. Cheat Sheet:
- Russian Seizure of Crimean Port: Another Cold War Reminder
- Is the U.S. Using Oil to Fight Russian Gas Politics in Ukraine?
- Crimea Votes to Secede: Western Powers and Ukraine Call Move Invalid
Follow Anthea Mitchell on Twitter @AntheaWSCS