Friends of Europe’s event, “The new geopolitics of energy: winners and losers”, brought together a panel of policymakers, business leaders, and experts from the energy field to discuss global and European outlooks on the world’s changing energy landscape.
The Ukraine crisis, instabilities in the Middle East, plummeting oil prices, the emergence of North America as a major energy producer, and the arrival of new disruptive technologies, have all triggered a sea change in global energy diplomacy and market balances.
With liquefied natural gas (LNG) prices plummeting around the globe and perspectives for greatly increased supplies from Norway, the Mediterranean region, North America and other parts of the world in the coming years, the outlook for the EU’s energy is increasingly secure, stressed Friedbert Pflüger, Director of the European Centre of Energy and Resource Security (EUCERS) at King’s College London, former Chair of the Bundestag’s EU Committee and Secretary of State for Defence.
“LNG will be a game changer,” he said, “especially where EU-Russia relations are concerned. Lower gas prices are a challenge for Russia and more competition in this field will be good for consumers in the EU.”
As economic and political power shifts from the West to the East and new economic powers strive for growth, sometimes ignoring the rules-based approach of the EU, European leaders need to work towards completing the Transatlantic Trade and Investment Partnership (TTIP), said Marietje Schaake MEP, Vice-Chair of the European Parliament Delegation for relations with the United States and Trustee of Friends of Europe.
Through TTIP, the US has been pushing to facilitate energy imports to the EU. This increase in imports, with commensurate infrastructure development and a focus on investment in renewables and alternative energy sources, would improve the EU’s position as a global energy player. “It is important that the EU seize the opportunity to lead global developments in energy markets before we are too small a voice,” she stressed. Especially as even the Middle East countries, rich in fossil fuels, are increasingly moving towards low-carbon investment driven by financial interest.
In the meantime, Europe’s “energy diplomacy is not about having one voice,” underlined Alar Olljum, Adviser for North Africa, Middle East, Arabian Peninsula, Iran and Iraq at the European External Action Service (EEAS). “It is about having one message and many voices, and sharing common narratives on key foreign policy issues in the geopolitics of energy.”
Iran’s geopolitical role in energy matters was discussed when H.E. Ali Majedi, Ambassador of the Islamic Republic of Iran to Germany and Deputy Oil Minister of International Affairs (2013-14), noted that “if a nuclear deal is reached in the talks between Iran and E3+3, Iran will return immediately to the oil market to reclaim its share. Within one year of a successful deal, Iran would be able to inject one million barrels per day to the market.”
Through a lively debate that touched on topics from the interconnection of energy security and climate change challenges to disruptive changes to the energy markets and shifts in business models, the panel outlined the current and future state of the geopolitics of energy.
In the world today, said Michael Rühle, Head of the Energy Security Section at NATO, “energy can be a matter of national security, whether we like it or not. […] And the winners of yesterday can be the losers of tomorrow.”
The event was part of our Greener Europe pillar, which focuses on global and EU policies needed to foster a sustainable economy that reconciles economic growth with environmental responsibility. Our 2015 initiatives include the publication of our Climate-Energy-Industry Working Group report “Europe’s energy union and the road to Paris and beyond: Towards an EU model reconciling climate, energy security and competitiveness needs”, a series of short analyses and infographics of the INDCs submitted by key global players, and our annual Climate and Energy Summit (date tbc), that will discuss the main challenges ahead for global leaders in view of ensuring affordable and secure energy while reducing CO2 emissions.
Session I – A global energy landscape in turmoil
Session II – The shifts in geo-strategic power balances
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IMAGE CREDITS: CC / FLICKR – NASA’s Marshall Space Flight Center
08.30 – 09.00 Welcome coffee and registration of participants
The world energy landscape is changing fast, revealing major geopolitical risks. The Ukraine crisis, conflict in Iraq and Syria, disruption of supplies from Libya and uncertainty over Iran’s re-entry into the global market in the wake of a nuclear deal are throwing the world into turmoil. Meanwhile, 1.3bn people still live without electricity and energy output has to increase by almost 60% by 2030 to meet the growing demand, without however exacerbating climate change and jeopardising global efforts to reach a new climate deal in Paris this year, which aims to limit the rise in world temperature to below 2°C. How best can the world tackle these challenges? What implications do all these trends have on the global energy mix, security of supply and energy prices? What can be done to address the instability in the Middle East and Eastern Europe and what role can NATO play in ensuring global energy security? How can we create the right market conditions for investors in a context of political unpredictability and volatile energy prices? How can we un-tap the energy potential of Africa? Should the race to exploit Arctic energy resources be pursued in the name of global energy security regardless of climate concerns and a call for reduction in the use of fossil fuels? How does Europe fit into this changing world?
Elmar Brok MEP / Chair of the European Parliament Committee on Foreign Affairs
Alar Olljum / Adviser for North Africa, Middle East, Arabian Peninsula, Iran and Iraq at the European External Action Service (EEAS)
Joan MacNaughton / Executive Chair of the World Energy Trilemma at the World Energy Council
Michael Rühle / Head of the Energy Security Section at the North Atlantic Treaty Organization (NATO)
Denis Simonneau / Member of the Executive Committee and Director for European and International relations of ENGIE
Moderated by Mark Lewis / Strategic Advisor for Greener Europe at Friends of Europe
10.30 – 11.00 Coffee break
The emergence of North America as a major energy producer, declining oil prices and the EU’s worsening relations with Russia have triggered a sea change in global energy diplomacy and market balances. America’s looming energy self-sufficiency has flooded the market with shale oil also promises to revolutionise the LNG trade. Russia, long accused of using energy resources as a political weapon, is turning to new strategic partners in Asia, while Europe hopes to diversify its energy supply portfolio thanks to new routes and LNG imports. What are the prospects for a transatlantic energy alliance and could Transatlantic Trade and Investment Partnership (TTIP) negotiations open a new chapter in US-EU energy relations? Why is OPEC allowing the market to determine oil prices and how does it affect the geopolitical scene and energy markets? Which countries and regions are the winners and losers? What does the oil price drop, combined with Western sanctions, mean for Russia? Will the expansion of LNG trade alter the current rules of the game, bring an end to today’s pipeline politics, and lead to the creation of a ‘gas OPEC’? How might the geopolitical panorama be transformed if the shale energy revolution spreads to other parts of the world?
John Knight / Executive Vice President of Strategy at Statoil
H.E. Ali Majedi / Ambassador of the Islamic Republic of Iran to Germany and Deputy Oil Minister of International Affairs (2013-14)
Friedbert Pflüger / Director of the European Centre of Energy and Resource Security (EUCERS) at King’s College London, former Chair of Bundestag’s EU Committee and Secretary of State for Defence
Marietje Schaake MEP / Vice-Chair of the European Parliament Delegation for relations with the United States, Member of the Committee on International Trade, and Trustee of Friends of Europe
Marat Terterov / Principal Coordinator of the Energy Charter Secretariat and Principal Director of the European Geopolitical Forum
Moderated by Mark Lewis / Strategic Advisor for Greener Europe at Friends of Europe
12.30 End of the conference
This conference is organised in association with: