Russia, Ukraine and the European Energy Security Matteo Verda Istituto per gli Studi di Politica Internazionale - Milano Università degli Studi di Bologna – Sede di Forlì April 29 th, 2014

EU ENERGY MIX natural gas 24% oil 36% coal 18% nuclear 12% renewables 12% 2012 – Source: BP, Statistical Review of World Energy 2013.

2013 – EU total: 462 Bcm. Source: Eurogas, Drop in 2013 EU gas demand emphasises need for swift change. EU NATURAL GAS SUPPLY EU domestic production 156 Bcm (33%) Russian Federation 126 Gmc (27%) Norway 105 B CM (23%) Algeria 36 Bcm (8%) others 39 B CM (9%)

E XPORT INFRASTRUCTURES AND U KRAINIAN TRANSIT DEPENDENCE

R USSIAN C USTOMERS IMPORTS FROM R USSIA A TRANSIT THROUGH U KRAINE B SHARE OF U KRAINIAN TRANSIT R USSIAN GAS / GAS CONSUMPTION C G AS / ENERGY CONSUMPTION D Italy24,1 100%29%38% Germany38,211,129%37%22% Czech Rep.7,0 100%57%18% Hungary5,7 100%80%40% Slovakia5,1 100%84%32% Austria5,0 100%60%25% France7,83,038%16% Bulgaria2,6 100%89%14% Greece2,5 100%56%13% Romania1,1 100%24%36% Slovenia0,5 100%60%10% others26,90,0-11%24% EU126,567,754%24% Sources: A – (2013, Bcm) Gazprom Export and Eurogas; B – (2013, Bcm) Pirani (2014); C – (2012) Eurogas; D – (2012) BP.

T RANSIT C OUNTRIES M AX. ( DAILY ) M CM M AX ( YEARLY ) G CM Ukrainian gas system Slovakia, Hungary, Romania, Poland Ukraine Nord Stream Germany Yamal-Europa Poland Belarus Blue Stream Turkey total (main pipelines) Minor pipelines Estonia, Finlandia Lettonia, Lituania total (Europe) R USSIA -E UROPE NATURAL GAS EXPORT INFRASTRUCTURES 2013 – Implied yearly functioning rate 90%. Source: elaboration on ENTSOG/GIE.

M AX. ( DAILY ) M CM M AX ( YEARLY ) G CM Slovakia Romania Hungary Poland 12 4 total U KRAINIAN EXPORT CAPACITY 2013 – Implied yearly functioning rate 90%. Source: elaboration on ENTSOG/GIE.

C APACITY M CM ( MARCH 2014) D AYS OF COUNSUMPTION ( EST.) Bulgaria20031 Slovakia Hungary Ukraine E ASTERN E UROPE STORAGE CAPACITY 2013 – Source: elaboration on GIE, Eurogas.

EU-R USSIA TRADE Source: Eurostat, ext_st_eu28sitc € B N

others 33% gas 13% oil and oil products 54% R USSIAN E XPORTS 2012 – UNCOMTRADE, online database $ 69 BN $ 170 BN $ 285 BN Total: $ 524 bn (€ 380 bn)

World total: Mtoe – Source: IEA, World Energy Outlook 2013 (2011) Mtoe – 88%2.189 Mtoe – 84% Mtoe – 75% 750 Mtoe – 72%718 Mtoe – 91%461 Mtoe – 90% P RIMARY ENERGY CONSUMPTION

Source: BP, Statistical Review of World Energy 2013 P RODUCTION R ESERVES O IL N ATURAL GAS C OAL Mbbl 10,6 Mbbl/d Bcm/y 636 Bcm/y355 Mt/y Gt R USSIAN OIL AND GAS PRODUCTION AND RESERVES

R USSIAN OIL AND GAS PRODUCTION Source: BP, Statistical Review of World Energy 2013 N ATURAL GAS (Bcm/y) O IL (bbl/d)

R USSIAN OIL AND GAS PRODUCTION internal consumption 68% EU 17% Turkey 4% Ukraine 5% Belarus 3% others (pipeline) - 1% others (LNG) - 2% Includes imports from Central Asia – Source: elaboration on BP, GazpromExport, Eurogas, Eni.

Bcm/y Source: IEA, World Energy Outlook 2012 N ATURAL GAS TRADE

© Matteo Verda R USSIAN F EDERATION AND ITS PARTNERS

U KRAINIAN GAS SUPPLY 21 Bcm 28 Bcm storage (-) 2% domestic production 42% imports 56% 2013 – Міністерство енергетики та вугільної промисловості України, online database 1 Bcm

U KRAINIAN GAS SUPPLY ( ) Elaboration on BP, Statistical Review of World Energy 2013, and Міністерство енергетики та вугільної промисловості України, online database B CM imports production

U KRAINIAN GAS CONSUMPTION PER SECTOR 23 Bcm 19 Bcm 9 Bcm 4 Bcm technical - other 7% power sector and industry 43% residential and public sector 34% district heating companies 16% 2013 – Elaboration on (Pirani 2014)

2012 – Elaboration on BP, Statistical Review of World Energy 2013 and IMF, online database tonnes of oil equivalent per million USD E NERGY EFFICIENCY

I TALIAN GAS SYSTEM

C ONTACTS Matteo Verda, Istituto per gli Studi di Politica Internazionale (ISPI) – Milano mail: blog: Linkedin: Linkedin/in/matteoverda