Held to ransom by Putin
Kremlin accused of hiking gas prices to force Europeans to approve pipeline
VLADIMIR Putin was last night accused of holding Britain and Europe to ransom over energy prices.
Experts said the Russian president had substantial scope to boost gas supplies and alleviate the shortages that are causing wholesale costs to soar.
But they claimed Putin was using the crisis as leverage over the disputed Nord Stream 2 pipeline project, which is run by the Russian state-backed energy giant, Gazprom.
The new pipeline, which will pump fuel under the Baltic, bypassing Ukraine, from Russia to Germany, is still awaiting approval.
It’s faced stiff opposition from the US and some European countries who argue it will make Europe too reliant on Russian gas.
This week Russian deputy prime minister Alexander Novak suggested that getting Nord Stream 2 launched would quickly stabilize European energy markets – a statement seen as an attempt to pressure regulators into certifying the pipeline.
Fatih Birol, head of the International Energy Agency, suggests Russia could increase exports by around 15 per cent of peak winter supply to the continent.
‘If Russia does what it indicated yesterday and increases the volumes to Europe, this would have a calming effect on the market,’ he told the Financial Times. ‘I don’t say they will do it but if they wish so, they have the capacity to do it.’
The Kremlin confirmed yesterday that existing gas transit routes already allow for more supplies.
Gas prices have soared in recent months after shortages caused by a prolonged winter in Europe, higher demand in Asia, and reduced North Sea production.
The UK receives very little of its gas from Russia, via Europe, but the continent relies on Moscow.
Business Secretary Kwasi Kwarteng said yesterday: ‘Unlike other countries, the UK is not dependent on Russian gas. We benefit from access to gas in British waters and from reliable import partners like Norway.’
A Whitehall source told the Mail that Europe is ‘addicted’ to Russian gas, and that it is ‘obvious Moscow is choking off supply and pushing up global prices to force EU states to approve new gas pipetry lines’. But MPs warned that the UK is still ‘hostage’ to the Russian president’s ‘ruthless use of gas as a weapon of coercion and influence’.
Tory Bob Seely, a member of the foreign affairs committee, said: ‘There is clearly a very, very significant geopolitical agenda which is going to have a potentially significant impact on domestic prices.
‘Although we are victims of it, this is not fundamentally about us. This is fundamentally about the Russians using Nord Stream 2 and using gas supply to get clearance for their pipeline directly into Germany. Unfortunately the Germans aren’t thinking about the wider implications of this and they need to start doing so.’ He added: ‘We’re hostage to poor decision-making in Germany, we’re hostage to Putin’s ruthless use of gas as a weapon of coercion and influence.’
Former Tory leader Sir Iain Duncan Smith said it would be a ‘mistake’ to ‘cave into Russia’s pressures now on Nord Stream 2’.
‘It is quite deliberately shaped to bring maximum money to Russia and to put maximum pressure on Eastern Europe and Ukraine.’
Liberal Democrat leader and former energy secretary Sir Ed Davey said it would be ‘deeply naive’ to allow the pipeline to go ahead. ‘Putin has always aimed to us Russia’s energy resources as a political weapon, it would be
‘Weapon of coercion and influence’
deeply naive of Western powers to fall for his blackmail now,’ he said.
‘These Russian threats underline the need for urgent action on energy security and climate change with investments in Britain’s own renewable energy.’ National security think tank The Henry Jackson Society also warned that the UK’s energy production shortage ‘leaves us at the mercy of Putin who uses our strategic dependency as an ecoalready
nomic weapon’. ‘As an authoritarian autocrat it is no surprise that Putin is choosing to prioritise our foes in China over meeting his supply obligations to europe,’ Sam Armstrong said.