Russia-Ukraine: Who Won the Gas War?

Jef Bossuyt

The French newspaper Le Monde has opened the New Year with the announcement: "the first war of the XXI century has been declared: the Gas War". The conflict between Russia and Ukraine about the price of gas goes far beyond the borders of both countries. Beside the stage the European Union and the United States/ are playing the main parts

On Sunday the 1^st of January 2006 Russia has shut down the two pipes that deliver gas to the Ukraine. The 3 pipes that go to Western Europe throughout Ukraine remained open. In 2005 Ukraine was still paying 50 dollars per 1000m³, and now Russia was asking for 230 dollars. Ukraine refused. From the 2^nd of January the gas deliveries to Western Europe from Ukraine suddenly fell with 25%. Russia accused Ukraine of illegally tapping the gas that was meant for Western Europe and restored a day later the deliveries to their previous level, by an extra delivery. A day later Russian Gazprom and Ukrainian Naftogas have reached a deal for 5 years. Gazprom will sell Russian gas for 230 dollars and mix it with the gas from Central Asia for 50 dollars. In that way it will be possible for Ukraine to pay for this mixture only 95 dollars per 1000m³.

EU demands gas security, US demands market prices

Concerned about its own gas deliveries, the EU has put Russia under heavy pressure in this conflict. "Germany has warned Russia already on Monday that its unilateral decision to cut off the gas deliveries to the Ukraine could damage Moscow’s economic relations with the West"¹ Berlin has meant, among other things, the building of a new gas pipeline under the Baltic Sea. With this line Germany wants to receive Russian gas directly within 5 years time, avoiding passing through pro-American Eastern European states, such as Poland and Latvia. Russia immediately surrendered to the dictate of the EU who became a real winner in this conflict. Gas is being delivered to Western Europe at 100% again, and from now on a Russian-Austrian company will take care of the distribution in the Ukraine.

The United States have also profited from the conflict, by setting Russia and Ukraine against each other in the price war. By this the US want to end the Union of the Independent States and to prevent that there will ever be an economic unity around Russia. US are of opinion that Russia shouldn’t be allowed to deliver cheap energy to the ex-Soviet republics. This "damages the competition". Russia should ask the market prices and deliver energy supplies rather to the Western countries. "Moscow News" writes: "Gazprom has promised to the US deliveries of gas that was discovered under the Barents sea, there is already a list of potential customers: Conoco-Phillips, Chevron, Statoil (Norway). The hard position of Russia towards Ukraine also means real disintegration of the UIS, a scenario that the US have no objections to"² The pro-American regime of Yushchenko also pushes Ukraine further in the direction of NATO, and pushes Russia farther and farther away. "It demands high prices for the military bases that Russia still has in the Ukraine and for the Russian military fleet at the Black sea in the Crimea. For the Russian observation posts and early warning (against the missile attacks) systems in Sevastopol and in Mukachevo the head commander of the Ukrainian air forces demands 5 million dollars instead of the current price of 1, 2 million. During the last meeting of president Yushchenko and Condoleeza Rice it was agreed that the US specialists would be allowed into these observation posts."²

Putin’s price rise from 50 to 230 dollars wasn’t an economic measure. It was meant as mainly political pressure on the population and the political forces of Ukraine and Belarus. There presidential elections will take place in March. Putin wants them to choose the side of Russia and the integration in the UIS. Thus not the side of Yushchenko in the Ukraine or the pro-Western candidate in Belarus. Putin threatens to punish a choice against Russia’s interests with higher gas prices. This is an immediate warning to the all ex-Soviet republics.

This is a policy that in the long run would achieve the opposite and would set the UIS’ states against Russia. Especially it is a disaster for the working population who is the big loser in this conflict. "The Russian nationalism of Putin has created a climate for the "Orange" Ukrainian nationalism", writes Ukrainian communist Manchuk.³ Because of that the bourgeoisie of both countries has won. The Ukrainian TV often and with pleasure shows the speech of a Gazprom’s representative who says that "the prices for the Ukrainian consumer are far too low, and are not satisfying the conditions of the market". This has led to a wave of anti Russian sentiments.

From their own side, the Ukrainian Council of Ministers declared a cruel price rise for gas and electricity for the population with 25% and 20%. This is a disaster in winter times.

Oleg Shenin from the Communist Party of the Soviet Union analyses the results of the introduction of the market prices: "The market, the idol of the Russian and the Ukrainian regimes, shamelessly punishes the nations, making them the victims of the equally mean nationalist politics on both sides. The capitalist regime in Kiev has pushed through its "orange revolution" with anti-Russian accents, and openly aims for the EU and NATO membership. At the same time, it would like to keep the privilege of low energy prices that remained as the rests of socialism, of its being part of USSR. The Ukrainian leaders refuse compromises and move over to dirty tricks, all the way to stealing of gas from the pipes that go through the Ukrainian territory. They are trying to play the gas card during the elections time, they are playing on anti Russian feelings. We see the fundamental solution of the energy problems of both countries in the re-installation of the Union, in the reunification of Ukraine with the union state with Russia and Belarus."

In the mean time, enormous social movements demand in the mean time the reintroduction of the achievements from the Soviet times. On the 12^th of October 2005 Russia’s civil servants went on general strike. The doctors and the nurses earn barely 5000 roubles (150 Euro) per month. They demanded the salary rise and better working conditions. 2 million workers from hospitals, schools and kindergartens took part in meetings and manifestations, and 500.000 effectively went on strike. In the Ukraine the workers of Ilichevsk harbour on the Black sea went on strike against privatisations. On the 1^st of October 2005 the Minister of Transport has given their container terminal for a 30 years’ concession to a private company.

For the price of only 100 Euro!

The workers of the Soviet Union are losing with every step forward of the capitalist market. But they haven’t given up.

(1) Reuters, 02.01.05

(2) Moscow News, 16-22.12.05

(3) www.communist.ru