European Energy Security amid Ukrainian Crisis

On the basis of overall analysis of the European dependence on Russia for its energy needs (mainly gas and oil) this paper tries to argue that economic sanction against Russia will have limited success. It will hurt the region badly, but it has more potential to jeopardize the European energy security aspect – a long cherished goal of the European nations. So, the best means to solve the Ukraine crisis is political and diplomatic tools, not the economic ones.


INTRODUCTION
Crimea issue and further escalation of tension and violence between Eastern and Western region of Ukraine have found echo all over the world. For many of the analysts, even if it cannot be denoted as return of the "Cold War'' (which was basically ideological and divided the world into two opposite camps, communism and capitalism), defi nitely it has once again started chilly rivalry 1 among world most powerful nations namely Russia, America and the countries of the European Union. The rest of the world is now compelled to take diplomatic and political stands, because of its geopolitical implications for the Eurasia region in particular and for the whole world, regarding this unfolding chain of events in the former Soviet region and there is no escape from this situation. The question of sovereignty and integrity of one country, as well as legitimate interest of another country, is getting defi ned and redefi ned. Ukraine issue in general and Crimean issue, in particular, bears political, diplomatic as well geopolitical implications for the world in present as well as in the future.
In this regard, it is important to note that many European nations, as well as America, unilaterally and hurriedly proclaimed Russia the main responsible country for this act of violence, tension as well as geopolitically rival act. However, the fact is diametrically opposite. Writing in international journal Foreign Affairs with the title "Why the Ukraine crisis 1 Barker

СРАВНИТЕЛЬНЫЙ АНАЛИЗ ЛОКАЛЬНОГО ОПЫТА
illegal overthrow of Ukraine's democratically elected and pro-Russian president -which he rightly labeled a "coup" -was the fi nal straw. He responded by taking Crimea, a peninsula he feared would host a NATO naval base, and working to destabilize Ukraine until it abandoned its efforts to join the West." 3 However, opposite to this fact, to punish Russia for its act and in order to let it retreat from its position the members of the European Union as well as the USA have announced stepwise economic sanctions against Russia. The fi rst step, which had been announced by Europe and America against Russia, were targeted at freezing assets and imposing travel bans on key Putin allies 4 and this ban list is still being step by step widened. 5 With GDP of more than $2 trillion, Russia is the eighth biggest economy in the world and export of commodities, particularly gas and oil, is a basis of its economy. 6 The EU is Russia's largest trading partner, and there are deep economic links between the two. Almost half of Russia's exports -$292 billion worthend up in the EU countries. 15% of Russia's GDP comes directly from the country's exports to the EU. Russia, in turn, is the third biggest trading partner for the EU, with $169 billion of its imports. 7 It is important to mention that the use of economic sanctions as a foreign policy tool to get the desired result is not new in this 3 Ibid. 4  can be regarded to be the best means to solve the ongoing international crisis.

EUROPEAN ENERGY SECURITY AND RUSSIA
Energy has always played an important role in Europe-Russia overall relationships. In this particular area, the both regions are indispensible to each other. Russia needs money, Europe needs energy. It is important to mention that due to uninterrupted supplies at affordable price Russia has been the main source of energy for European countries, and in the larger European context "Russia stands out as the most important energy supplier. The European Union (EU) imports nearly a third of its oil and almost half of its natural gas from Russia -although the level of dependency differs greatly among the EU member states. According to the European Commission fi gures, 27% of EU oil consumption and 24% of gas consumption are covered by imports from Russia. As far as EU imports are concerned, 30% of its oil and 44% of its gas come from Russia. Russia is also a major exporter of coal; Russian coal accounted for almost 12%  revenues are generated from the production, sale and export of energy commodities, so Russia needs an oil price higher than $117 in order to balance the state budget. Most of Russia's energy export revenue has been generated from trade with the EU, which spent, according to its own estimates, $1 billion per day on importing energy resources from beyond its borders. In 2012, the EU paid $300 billion to external suppliers of oil, and $85 million to external suppliers of gas -Russia supplied a third of the oil and 39% of gas imports to the EU." 10 To quote Metais, "given its central role in the economy, energy is closely linked to the economic growth. It has been calculated, for instance, that for one percentage point of economic growth, primary energy consumption increases by 0.5 point. Considering the fact that development is based on economic growth, it is not surprising that energy has come to the forefront of political issues". 11 The table below has been presented to show unevenness of overall energy (oil and gas) distributions (reserves) and its consumption. 10

СРАВНИТЕЛЬНЫЙ АНАЛИЗ ЛОКАЛЬНОГО ОПЫТА
However, it can be noted that there are different "Europes" taking into account energy needs. Whether it is the EU-30, the 27 current EU members, or the 15 states that made up the EU before the enlargement of May 1 2004, the level of dependency on Russia varies. In this regard "the countries of the European Union can be divided into three groups. Germany and Italy belong to the fi rst group of countries whose dependency is growing, and which are willing to fund joint projects and invest in Russia's up-stream activities. The second group of the European states are those whose dependency on Russia is even higher than that of Germany and Italy, such as the Baltic States, Finland, and Central Europe. The third category is represented by states which are less dependent on Russia, but whose gas reserves are waning, including Norway, the Netherlands, and the United Kingdom". 12 The real energy situation in European countries and their dependence on Russia can be presented in the following table:

DIVERSIFICATION OF ENERGY RESOURCES
It is not surprising that when member-states of the EU sat together to discuss the next step of economic sanction against Russia on 21 March 2014 in Brussels, the issue that got prominent place was energy. 13 Now the main issue which has been discussed is to make European nations less dependent on Russian energy sources and diversify its alternative energy. In this regard, it has been argued by many analysts that if Europe wants to hurt Russia on Crimea issue it should stop importing energy from Russia. 14 Otherwise, this exercise of economic sanctions will be futile. 15 However, it has been not for the fi rst time this view emerged among member-states of the EU. Many countries of the European Union feel that new Russian administration has time to time used energy as a foreign policy tool against neighboring country as well as the European countries .The years of 2006 and 2009 can be cited as an example when European countries were hit hard by blockage of energy fl ow to Ukraine. 16 Now they are thinking that time is ripe for a search for alternative energy sources. However, congressional research service report prepared for the members and Committees of the Congress in 2013 reveals that "there are many alternatives to Russian natural gas for Europe to choose from, but it would be diffi cult, if not impractical, for Europe to consider replacing all Russian natural gas imports. Some EU countries and companies also appear reluctant to shift signifi cantly from the status quo. Some of Europe's larger natural gas companies have huge fi nancial interests in maintaining Russian supplies and do not see a problem in depending so much on one country". 17 Similarly given Russia's geographic proximity to Europe and also its large reserves, Wenger is of the view that "Europe's additional diversifi cation options for stable, reliable, and sustainable energy fl ows are limited. On the one hand, Europe already has a relatively wide range of energy types, sources, and transit routes due to the high diversity of energy policies at the national level. On the other hand, Russia's energy power has been rather successful in capturing Caspian energy and in monopolizing European access to it." 18 He is further of the view that "from a European point of view, transit routes and supplies from the Caucasus, North Africa, and the Middle East are fraught with risks of their own, given the complexities of the political confl icts in these regions -a point driven home during the 2008 crisis in Georgia". In this regard, writing about ongoing Crimea crisis and its possible implications, Barker and Crofts have an opinion that EU struggle to reduce its reliance on Moscow in the short term and most alternatives will be more costly than the oil and gas that is currently pumped directly to the West from Russia. 19 However, Russia does not face this type of limitations in searching for alternative energy markets; it has met success also in this regard with the signing of a big gas pipeline deal with China (400 billion dollar worth) moving its energy pivot further to the East. 20

CONCLUSION
It is because of the above reasons why Western newspapers are full of information about why there has not been any consensus among the European countries about actual modalities of the economic sanctions. 21 In this regard, it is important to mention that European countries cannot follow the American path of imposing economic sanction on Russia because "the economic relationship between Russia and the U.S. is more unbalanced. Russia is the