Eric Margolis:
…Russia has 20% of the world’s natural gas reserves, and at least 7% of proven oil reserves, some 75 billion barrels. However, Russia’s huge reserves are in remote regions and will require vast investment to further exploit.
Even so, as energy prices soar, Russia grows wealthier and more powerful by the day, a sort of Saudi Arabia with snow. Interestingly, Russia today commands far more influence over Western Europe than it did when 100 Red Army divisions threatened the continent to the point where France began re-arming the Maginot forts.
Russia’s Gazprom now accounts for nearly 40% of Germany’s and Ukraine’s gas consumption, 33% of Italy’s, 26% of France’s heating needs, 70% of Austria’s, and almost all of Eastern Europe’s gas. Moscow does not need tanks to threaten Europe.
If Vladi and Dimi turn off the gas export tap, as they recently did to late-paying Ukraine, Europeans will shiver in the winter cold.
Washington is deeply alarmed by Russia’s growing energy clout. Until recently, the U.S. controlled much of world energy through its domination of the Middle East. Now, Russia is challenging America’s oil Raj and Washington is struggling to develop new pipeline routes to circumvent Russia’s fast expanding pipeline network.
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The Kremlin now must deal with Washington’s violation of secret agreements with former General Secretary Mikhail Gorbachev not to advance NATO any further east in exchange for Moscow freeing Eastern Europe.
The Russians tend to overplay their hands, creating dangerous instability… um, not unlike other countries one could name. Let’s hope that Germany, France, the Scandinavian countries and the UK get their act together fast and start cranking out the biodiesel and recovered methane they need to tell the Russians to blow.
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