Russia-China Gas Deal: The End of the US-EU Energy Power Play?



The Iranians would be relishing at the prospect of a similar deal to ease the economic hardships the country has been enduring for a while now. If Iran is able to ink a similar deal with China or India, it would very well strengthen its hand in the ongoing nuclear negotiations and boost the conservatives. While India had backed out of the Iran-Pakistan-India LNG pipeline owing to the special provisions extended by the US for its civilian nuclear energy program, refusal to hand out a similar facility to Pakistan has led the country to go ahead with the project all by itself. Even India, with a critical gas shortage at home, could very well join the trajectory in the near future.

All of this means that the leverage enjoyed by the Gulf States such as Qatar – one of the high-profile allies of the United States in the region – will take a beating in a longer timeframe. The recent European elections also raised a question mark over the mandate enjoyed by the parliament at Brussels wherein the UK, France and Denmark have voted overwhelmingly in favor of Eurosceptic parties. While the EU is marred by internal bickering, the Russia-China duo are romping away with a great show of unity – at least in inking deals that could diminish the clout of the European heavyweights.

All in all, there is much to ponder and strategize accordingly for the policymakers and statesmen both in Washington and Brussels. For this deal and its ramifications would be felt in the times to come.  

Faraz Shams is an independent oil and gas market analyst. A trained mechanical engineer, he has worked with multiple energy companies along with various publications focused on the oil and gas sector. His areas of interest include global geopolitics and market analysis, among others.


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Harrison Bergeron  |  June 20, 2014
>> Russias meddling in Ukrainian affairs :) Cool analysis, bro.
Paul Savill  |  June 19, 2014
This article very accurately sums up the reality of supply and demand for hydrocarbons. But what should be of more concern, to all involved in the oil and gas industry and toall the customers who are supplied by it in the developed economies, is the ineptitude displayed by policy makers and industry leaders when dealing with emerging economies. Countries having raw materials will sell to countries requiring raw materials. Its simple economics. Current global demand and supply resides in other regions now. People in the developed world need to come to terms with the world as it is, not a world as they perceive it to be.

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