Europe’s Gas Crunch Isn’t All Good News For Producers

Europe’s Gas Crunch Isn’t All Good News For Producers

It has been a good couple of months for Russian President Vladimir Putin. The opportunities for enhancing Russia’s “great power status” — long Putin’s strategy for shoring up support at home — are coming faster than he can take advantage of them.

In the past, his strategy has often involved taking big risks, such as the annexation of Crimea or military involvement in Syria. Yet in recent weeks, the geopolitical gods are delivering Putin manna from heaven. While this moment brings the US and its allies warnings about Russian near-term behavior, it also delivers messages going beyond Russia that are missed at their peril.

As if the calamitous US withdrawal from Afghanistan wasn’t enough to make Putin smile, the energy crisis unfolding in Europe has put him in the catbird seat. Russian actions thus far have not helped alleviate natural gas shortages in the UK and Europe. But Russia is not the original culprit for the crisis as it has unfolded.

Instead, the rise in price of natural gas — almost 600% in the past year for a Dutch benchmark — is the result of a complex set of factors. These include an unusually cold spring that left European gas inventories low, a