The term Eurasia refers to the following nations; Caspian region, Russia, Central Asia, Europe, and Northeast and South Asia. Russia is the major supplier of energy in Europe. However, this reliance is associated with grave security issues. Partly, this is because of the uncertainty regarding whether Russia has a prolonged ability to produce adequate gas and oil, which satisfies the escalated demands. Russia provides gas and oil for use at home and abroad. The production of energy in Russia is disadvantaged by reducing prices, huge taxes, politicization of energy production, inadequate investment, and inefficiency (Oliker, 2002). The most pressing issue is the escalated immediate search for strategies, which will facilitate the progress from an economy that relies on carbon.
The concerns about the production reduction in Russia are founded on the reality that the present gas and oil sources have an extremely low output. Moreover, it has proved difficult to establish novel fields in inhospitable regions. This is particularly at the Barents Sea, eastern Siberia, and Yamal Peninsula (Rashid, 2008). It is worth pointing out that there was state control partnership over the Russian gas and oil sectors, which began in the 21st century. This aggravated the problem since Rosneft and Gazprom national champions proved incapable of directing investment towards novel projects. Moreover, the private enterprises were more efficient in production. The Kremlin’s ownership consolidation had huge consequences in the energy sector.
In Gazprom, the state is recognised as the biggest shareholder. During the Putin years, Kremlin had a dramatic increase in control (Laruelle, 2008). Furthermore, there has been a reversal of the 1990s privatization, where the private firms do not benefit from the oil sector. It is worth pointing out that this consolidation is driven by states. Consequently, it has contributed to the concerns that Kremlin possesses the ability to utilise the gas and oil accessibility as the tools for its foreign policy.
During the 2nd term, Kremlin suggested that the production of gas and oil should be under the control of Rosneft and Gazprom. However, during the latest economic recession, both were defeated. The foreign firms in Russia were not spared from the national champions’ consolidation. Royal Dutch and Moscow were among the affected companies. Kremlin denied foreign firms an equal share in all projects.
In the 1990s, energy geopolitics formed a key element in the association between Eurasia and the West. However, gas and oil became exceptionally central during Putin’s reign. These developments were linked to the transformations in the energy sector in Russia (Hiro, 2009). The state directly managed the extensive gas and oil reserves in Russia. It is worth noting that this increased European’s worries regarding the strategic management of energy supplies. The prices were extremely high. Furthermore, Russia’s resurgence was based on energy, and it permitted Moscow to force its influence gravely in Eurasia.
This also involved the control over gas and oil transit to the west from the east. In addition, powers from the outside were prevented from constructing pipelines.Moscow used hard power on Georgia, which strengthened Russian’s power over energy. The manner in which Europe responded to the war, decrease in energy prices, and the ruining of Russia’s prestige contributed to the doubts about Russia’s geopolitical reach. Therefore, the powers from the Western had a chance to look into the vital imbalances regarding Moscow’s energy relations.
References
Hiro, K. (2009). Inside Central Asia. London: Overlook Press.
Laruelle, M. (2008).Russian Eurasianism.John Hopkins: The Johns Hopkins University Press.
Oliker, O. (2002). Faultlines of Conflict in Central Asia & the South Caucasus. London: RAND Corporation.
Rashid, M. (2008).Descent into Chaos.New York: Viking Juvenile.