We lost Bulgaria. We are likely soon to lose the Czech Republic. We gained Ukraine. Poland has always stood with us. Germany hedges its bets. France definitely is not with us. The United Kingdom probably will side with us. The Baltic States would love to join us if they have the resources. A fierce battle rages over Romania.
The adversary is Russia, a petro-state that projects power through control of the European energy market. President Vladimir Putin’s regime depends on selling hydrocarbons. That pays for the Russian state and for a patronage system that keeps his supporters and backers in clover.
Many of Gazprom’s decisions are political. It pays for long pipelines to bypass Ukraine. Political appointments and scams are costly. Analysts estimate that Gazprom needs to charge about $12 per 1,000 cubic feet of natural gas to break even. It collects about $16 per 1,000 cubic feet in Eastern Europe. In the United States, the cost is about $2.
The price of natural gas in America dropped because hydraulic fracturing glutted the market with cheap gas. There are no such commercial wells in Europe.
If hydraulic fracturing can be used on a commercial scale in Europe, the price of natural gas there will plummet. It could force Russia to start working for a living and would have radical political repercussions.
Almost all European countries have some shale gas deposits. Commercial use of those resources would increase energy independence, reduce demand for gas imports and thus reduce prices, improve the balance of trade and create local jobs. Three European countries, Poland, France and Ukraine, have potential deposits that may turn them into gas exporters.Read the rest of the article here.
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