Pierre Noel, from The European Council on Foreign Relations just released a very good paper on how the European Union should deal with Russian gas. It highlights the importance of finalizing the internal market. It says:
The solution to the Russian gas challenge lies not in foreign energy policy but in reform of the European gas market itself. An integrated and competitive European gas market would:
• Create the maximum possible degree of solidarity between European gas consumers.
• Improve collective supply security by allowing the price mechanism to re-allocate physical supply across the entire market in times of supply or demand shocks.
• Make Member States’ bilateral relations with Russia largely irrelevant to the conditions of access to Russian gas for consumers. An integrated market would ‘Europeanise’ bilateral commercial relationships with Gazprom, without the need for political involvement from the EU.
And who’s main responsibility is it? Unsurprisingly:
“It is no exaggeration to say that the fate of Europe’s gas integration project depends on France and Germany. Whatever the technical merits of the third package, the vision of an integrated competitive market will not be realised as long as these two governments fail to fully embrace it.”