Q+A: EU options in Russia-Ukraine gas dispute
(Reuters) - Russian gas supplies via Ukraine to southeast Europe and Turkey were halted on Tuesday as a result of a pricing row between Moscow and Kiev, and Austria and the Czech Republic reported sharp falls in supplies.
The following is an overview of how the European Union, which receives about a quarter of its gas from Russia, and about a fifth of its gas via pipelines through Ukraine, is reacting and what options it has.
Q - What line is the EU taking on the dispute so far?
A - The Czech Republic, which took over the presidency of the 27-nation bloc from France on January 1, says the EU must not take sides in the dispute. It has turned down requests to mediate in the pricing row, arguing this is a commercial dispute that can be solved only by the two parties involved.
But, as signs of disruptions to EU supplies emerge, the EU is gradually adopting a more active approach, sending a mission to meet Ukrainian officials on Monday and one to meet representatives of Russia's Gazprom on Tuesday.
It has condemned cuts in supplies to EU states and promised to "intensify the dialogue" with both parties -- but insists it will not mediate. A three-way EU gas summit with Russia and Ukraine is considered an outside option if all else fails.
Q - What is the risk of European consumers running short of gas?
A - With freezing weather in much of Europe, officials are keen to play down the possible impact on domestic and business users. They stress gas stocks are relatively high after a mild start to the winter and because a recession has hit economic activity. Most large EU countries say they have access to other supply sources including Norway and Algeria. One Czech official estimated that, under the most favorable conditions, European reserves could last several weeks. Others say shortages could be felt within days in some countries if the cold snap persists.
Q - What can the EU do next?
A - In the short term, the bloc is stepping up its calls for Russia and Ukraine to resolve the dispute; Czech Deputy Prime Minister Alexandr Vondra has called for an agreement by the end of the week. The EU says both sides' credibility as energy partners is at stake -- Brussels has long held that Russia needs revenues from energy supplies to the EU just as much as Europe needs its gas. EU foreign ministers meeting in Prague on Thursday are unlikely to come up with any fixes if the dispute is not settled by then: Czech officials expect the talks to reaffirm the EU's long-term policy of diversifying its energy supplies and looking at alternative supply routes bypassing Russia and Ukraine.
Q - Will the EU always be dependent on Russian energy?
A - Skeptics say the EU has had years to reduce its use of Russian energy and has failed because of internal divisions and the lack of alternatives. Ex-communist east European states accuse Russia of abusing its energy dominance and want a tougher EU line. Late last year the European Commission launched a strategic review of energy policy options.
To limit Moscow's dominance, the West is backing an energy corridor from Central Asia that bypasses Russia, passes through Azerbaijan and Georgia into Turkey and links with the planned Nabucco pipeline to bring in Caspian gas. Russia's incursion into Georgia last year showed that route is vulnerable. It may also be hard to secure enough gas for the route and to win a deal with Turkey to pipe the gas through its networks.
The European Commission wants to increase shipments of liquefied natural gas (LNG) and is looking at Nigeria. A 4,300 km (2,670 miles) Trans-Saharan Gas Pipeline carrying Nigerian gas could secure more energy for Europe but could face attacks in the lawless Sahara. Nuclear power advocates say atomic energy would help reduce dependency on Russia, but there remains no Europe-wide consensus to promote the fuel. The Paris-based International Energy Agency concluded last year that energy was perhaps "the weakest of (EU) policy areas."
(Compiled by Mark John, editing by Tim Pearce)
