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Pipeline politics

‘Turkish Stream’ would work against European consumers, says Cambridge Judge researcher.

Pipeline politics
Russia’s recent decision to abandon plans for a “South Stream” energy pipeline in favour of a “Turkish Stream” that avoids troubled Ukraine would work to the detriment of European consumers, says Chi-Kong Chyong, a member of the Economics and Policy subject group at Cambridge Judge Business School.

By seeking to move the pipeline farther south, Russia would force European Transmission System Operators (TSO) to pay for infrastructure to deliver gas to their home markets from a new hub on the border of Turkey and Greece. Such a move would also make it easier for Russia to control prices by manipulating gas volumes because the hub would be placed outside the EU, in Turkey, and thus outside the authority of EU regulators, says Kong, a researcher at the Energy Policy Research Group at Cambridge University.

Such a move would also mean that Ukraine would lose geopolitical clout, thus making it less attractive to Western Europe as a trading partner – a result that Russia would welcome, he says.

Kong has written at length on this subject in an article entitled “Does Russia’s Turkey pipeline make sense?” in the Brussels-based online EUobserver newspaper.