Europeans should face the truth: Hungary has secured triple geopolitical success by signing a new 15-year contract with Gazprom on Russian gas supplies. Thanks to this contract, Moscow continues to consistently reduce gas transit through Ukraine, while aggravating contradictions within the European Union, and at the same time pulling Kiev into a diplomatic conflict with one of its European neighbors.
Viktor Orban’s Hungary undermines the unity of the European Union
For the European Union, this is undoubtedly a defeat – not strategic, but tactical. Hungarian Prime Minister Viktor Orban once again undermines the unity of the EU, demonstrating his disregard for the jointly developed positions in Brussels to the allied countries and the European Commission.
On the issue of Ukrainian transit, the common position is that Russian gas should continue to flow in significant volumes through Ukraine in order to ensure not only its economic interests, but also its security. The preservation of transit is seen as a kind of insurance against possible new aggressive actions by Russia on Ukrainian territory.
Andrey Gurkov
However, Budapest again went to separate agreements with Moscow, as it already did this year with the purchase of the Sputnik V vaccine, which did not receive official EU admission. A key element of the new contract with Gazprom is that henceforth Hungary will be supplied with Russian gas bypassing Ukraine.
This became technically possible thanks to the construction of the Russian Turkish Stream gas pipeline: one of its lines supplies gas to Turkey along the bottom of the Black Sea, while the other supplies Bulgaria and Greece, as well as Serbia. From this Balkan country to Hungary and will receive about three quarters of the gas volumes that have so far gone there through Ukraine. The rest of the cubic meters will be provided by Austria. Thus, the “Hungarian scheme” for reducing Ukrainian transit willy-nilly involves three more EU members, as well as a state intending to join it.
Nord Stream 2 and Turkish Stream are two parts of Putin’s unified plan
It seems that in recent years Brussels (including, perhaps, due to the activity of Poland and the Baltic countries) has been so fixed on Nord Stream 2 and opposition to this project that it underestimated the importance of the Turkish Stream in the strategic plan of Vladimir Putin to deprive Ukraine of gas transit.
But both offshore pipelines – one in the Baltic, the other in the Black Sea – are part of the Kremlin’s single strategic plan to start exporting Russian gas to Europe bypassing Ukraine from the north and south. It is no coincidence that, according to the original plan, both pipelines were supposed to go into operation at the same time in December 2019, when the ten-year Russian-Ukrainian transit agreement was just about to expire. For a number of reasons, this plan then fell through, but Moscow did not abandon its ultimate goal and is now approaching it step by step.
Gazprom is approaching its goal step by step
In the Baltic, Gazprom has completed the powerful Nord Stream-2 and is now seeking permission to operate two of its lines at once, which requires an exception to the rules of the EU’s Third Energy Package. To make the EU more compliant, the Russian supplier emptied its European gas storage facilities and, amid record soaring gas prices, is insistently making Europe understand that it is approaching winter with record low reserves of blue fuel.
And in the south, Gazprom held out the onshore continuation of the second line of the Turkish Stream, dubbed the Balkan Stream, through Bulgaria to Serbia, after which it agreed with Hungary on a new long-term contract, offering Budapest particularly favorable gas prices, according to reports Russian media.
Berlin and Brussels need realistic scenarios of how to respond to Russia
In this situation, it is becoming increasingly difficult for the European Union to demand from Moscow firm, legally enforceable guarantees of maintaining transit through Ukraine after the expiration of the current five-year Russian-Ukrainian agreement in 2024. Angela Merkel, the acting chancellor of the Federal Republic of Germany, hoped for these guarantees. She spoke about them in July with US President Biden, but could not come to an agreement in August with Russian President Putin.
First of all, Merkel’s successor and the new German government should stop repeating the mantra that has been heard in Berlin in recent years that Nord Stream 2 is a purely economic project. And then, recognizing it as a geopolitical project, together with Brussels, carefully prepare realistic scenarios in the event that Russia does not give convincing guarantees of the preservation of Ukrainian transit or promises only insignificant volumes. At the same time, it will be necessary to take into account the economic interests of the entire EU and the energy dependence on the Russian Federation that remains so far.
Kiev should not fight rearguard battles over gas transit
The Ukrainian authorities, in turn, are unlikely to now aggravate relations with their western neighbor Hungary (a demarche in the form of a summons of the Hungarian ambassador to the Foreign Ministry is quite enough for an explanation), since this will still do nothing and will only play into the hands of the Kremlin. Instead of conducting numerous rearguard battles in an attempt to stop the “northern” and “southern” flows, Kiev should concentrate all available forces in another direction – on the modernization of the Ukrainian economy. The more successfully this modernization goes, the faster Ukraine’s dependence on the transit of Russian gas will decrease and its defense capability will grow.
Posted by Andrey Gurkov, economic commentator German wave
The commentary expresses the personal opinion of the author. It may not coincide with the opinion of the Russian edition and German wave generally.
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