In 2007, Alexei Miller, head of Russia’s state-gas behemoth Gazprom famously boasted he would raise the company’s market value to US$ 1 trillion; up from US$ 360 billion at the time. Today, much of that dream has vaporised. After years of hard-nosed tactics in Central and Eastern Europe and several high-profile gas supply interruptions, Gazprom’s reputation as a reliable supplier is in tatters. The fallout over the Ukraine crisis brought severe pain to the Russian economy and prompted the EU to press ahead with the launch of its Energy Union. American frackers and the halving of the price of oil essentially did the rest. What’s more, EU competition law has proven to be a powerful tool against the whims of Putin and Gazprom, and acts as a careful reminder to those Member States that wish to bend the rules. Hungary and Bulgaria – to name but a few – will undoubtedly be more careful next time.
Rattled by sanctions, and facing a legal wall in Europe, Russia had to change course. Today, Gazprom is increasingly forced to do deals with countries outside of Europe that carefully exploit the Kremlin’s weaker negotiating position. Thanks to the muscles from Brussels, Moscow’s gas empire is slowly crumbling. Now, it is time to deliver the final blow writes Sijbren de Jong in EUobserver.
The full article can be read here.
A Polish language version of the article appeared on Biznes Alert. The full article can be read here.
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