Comment: Implications of Crimea Crisis for Energy Markets: vulnerabilities of markets and weakness of States
Published 24 March 2014
Introduction
Dr. Andrei V. Belyi - March 19th 2014 - Current developments surrounding the Russia-Ukraine relations once again spur a lot of attention. A crisis of international governance spreads into a political sphere and also puts under peril the peace between the two countries. In addition, there is an unprecedented tension between Russia and the West with their mutual accusations of double standards and the Russia’s explicit revision of international norms. The political rhetoric from Brussels, Moscow and Washington increasingly resembles that of the Cold War during the second half of the 20th century.
Many ask if there are serious implications in relation security of energy supply, as well as of investment and trade, either among causes or consequences of the current events. The fact is that Russia remains the world biggest oil and gas supplier and Ukraine still remains one of the most important transit States. Markets tend to become more vulnerable in times of new political unpredictability. However, the current context also demonstrates a deep vulnerability of States in face of the markets.