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Sun. June 23, 2024
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Merkel's Geopolitical Menage Trois
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Germany’s Angela Merkel, eager diplomat, objective conciliator, and ‘honest broker’ between East and West, finds herself in a remarkable ménage a trois over energy policy. Not France and Poland, with whom she holds a December 5 summit: her controversial partners are Russia and Poland, each tugging her in opposite directions.

German entanglement with Russian energy sources is an old story by now. Largely dependent on Russian oil and gas (something Gerhard Schroeder and Vladimir Putin skillfully exploit), Merkel’s Germany nonetheless adopts a posture of energy independence and reducing use of fossil fuels. Merkel rebuffed Putin’s overture to give Germany unilateral access to the Shtockman offshore fields, after the US was bumped aside, but did so in the name of Europe, not Germany. Indeed, looking to Merkel’s imminent assumption of the EU Presidency and the G8, she could do little else.

Yet Germany seems tightly in Russia’s embrace, and Poland doesn’t like it. Historically suspicious of both her neighbors (given 20th century history, can you blame her?), Poland fears tightening energy-supply relations between Russian suppliers and Warsaw’s neighbors to the East (and south—Russia is now engaging Italian customers as well) could a.) make Poland unduly dependent on political relations over which it has no control, or b.) create supply lines (the Baltic pipeline) that bypass Poland altogether in a classic energy-politics squeeze play.

The upshot is that Poland, new kid on the European block, is in the ironic position of asserting the primacy of European regulatory authority. The Kaczynski government blocked new EU-Russia talks over energy, pointing out to Russia’s refusal to approve Europe’s Energy Charter, which is supposed to set civilized rules-of-the-game for European energy markets. Russian intransigence does send bad signals, reaffirmed by Putin’s intransigence on November 24 in preliminary talks with EU leaders. Nor will Putin allow Polish farm products into Russia. Russia’s attitude is “what’s the rush?”, making Europe more nervous than ever about its energy sources. (And that’s without considering possible Kremlin involvement in knocking off dissidents….)

With Germany’s diplomatic agenda (the Great Conciliator) at war with is energy needs, Angela Merkel is in a bind, both as Chancellor and as incipient EU/G8 leader. Germany needs Russian energy, but European policy aims for greater energy competition, not monopolistic sole-source deals. Further, Merkel wants to recommit Europe to reducing (or slowing the growth of) use of fossil fuels under the banner of fighting climate change (arguably linked to fossil-burning CO2 emissions). Yet in dealing with Russia Germany puts its current energy needs ahead of these high-profile geopolitical abstractions.

With Poland trying to outflank Germany as best-new-friend of the United States in central Europe, and the US increasingly wary of Putin’s energy (and domestic) politics, Germany has a challenge and an opportunity. All parties want greater diversity in Europe’s energy supplies, and pipelines built through former CIS countries less responsive to Putinist directives. Even with US leadership faltering in the waning Bush era, Russia’s bad-actor arrogance makes Poland’s US tilt the better bet.

Merkel’s Germany can usefully give a wink-and-nod to Poland’s concerns about Russian supply dependence as a means to pressure Russia into joining the Energy Charter. It wouldn’t hurt for Germany to follow Tony Blair and launch a new drive for nuclear power, the only viable near-term alternative for supplying non-fossil fuel energy, reducing dependence on imports, and lowering CO2 emissions.

The dirty secret is that Europe has only the rule of law to discipline Russia’s energy imperialism, while Russia knows how dependent Europe is. With oil prices well above $50 a barrel, Russia need not worry that its centralized lawlessness will cost it good business. Though Europe has no hard resources Russia needs, it does have market access, technological know-how, and investment capital. Neither Germany nor the rest of the EU have been willing to threaten withdrawing any of those assets from Russia—that would not be very European, after all. But unless Ms. Merkel can triangulate more effectively, she faces hard political and economic choices. After all, the ultimate weapon against oil-and-gas cartels (and against CO2 emissions, for that matter) is economic growth: the lack of it, that is.

A severe economic downturn in Europe would reduce fossil fuel demands at the margin sufficiently to neuter Russian energy aggression. Russia should be careful what it wishes for, since keeping its energy prices high itself puts a big drag on growth. Stagnation or recession would bring a whole new set of problems for Germany and its neighbors, and further aggravate the spread of economic nationalism that bedevils Brussels. Yet it might galvanize Germany et al. to more aggressively pursue energy diversity.

If Poland is willing to play ‘bad cop’, Ms. Merkel is advised to stick with her ménage for now—it’s the least bad alternative.

George A. Pieler is a Senior Fellow with the Institute for Policy Innovation. Jens F. Laurson is Editor-in-Chief of the Center for International Relations.

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