Sputnik: How likely do you think the US Treasury is to act upon the request of the US senators?
Ben Aris: I think the Americans have a vested interest in blocking the implementation of Nord Stream 2, insomuch as there's an energy war going on at the moment about supplies of energy and they're afraid that by putting Nord Stream 2 into play Ukraine will be entirely bypassed, and that, as they see it, will give Russia leverage over the whole of Europe, insomuch as a third of Europe's gas supplies come from Russia and that's a significant amount, it's enough to give you strategic leverage over Europe, and of course the countries closer to Russia are even more dependent up to and including 100 percent of the gas to Finland, for example, is Russian gas. With this geopolitical showdown they're interested in containing Russia and, of course, energy politics is a key part of that.
Sputnik: Nord Stream 2 is also a joint venture of Russia and five European countries that are France, Austria, UK, Dutch and German firms are involved in that, are they going to be supportive of this kind of move?
Ben Aris: There's a dichotomy here in relationships between the West and the East, there's the public politics on the one hand, where everybody is trying to be tough with Russia and contain it, and then there's the business aspect and the two sides are actually intimately tied, and Europe and Germany, in particular, is heavily dependent on Russian energy. So, on the one hand, they're worried about geopolitical leverages and gas wars and on the other hand they're worried about securing cheap supplies of energy to run their factories and the two don't sit well together, it causes tension, so on Monday they will be talking about cheap gas and on Tuesday they will be talking about poisoned spies and the whole thing is extremely confused, and the relationships are not settled and this leads to all of the chaos that we are seeing at the moment, and various fractions as well are making use of this for domestic political reasons, it makes you look tough if you are rude about the Russians, and people see that as an investment into their own political capital for domestic political reasons which is further confusing the situation, so it's a mess basically, it's a horrible mess.
Sputnik: Will money win out though in the end?
Ben Aris: Money always wins out, at the end of the day the job of politicians is to run the economy and produce prosperity and they are, to be a little critical, they're venal insomuch as you can't run a country without money and cheap gas is cheap gas and that's a major outgoing and so people at the end of the day will be looking at the bottom line and they will find some sort of fudge where they think they can get their political capital by standing up to the Russians on one hand but at the same time doing it in such a way so that the Russians will sign a deal to deliver the cheap gas so that the factories will run and everybody will make their money.
Sputnik: So how do you think this is going to be resolved in the end and how soon do you think we will see so kind of a resolution? Do you think that the countering of America's adversaries through the sanctions act will be able to help the US Treasury block the construction of Nord Stream 2?
Ben Aris: I don't see that the Americans have any leverage at the end of the day, they can say what they like and they can lean on Europe, but Europe's already made it perfectly clear that this is none of America's business, and that their energy deals are their energy deals and that they will make up their own minds, and the Americans will lean on and have been leaning on Europe, but when they brought these sanctions out there was an outcry in Europe in both Berlin and Brussels that the Americans had overstepped the mark, and while they are fully aware of the need to deal with Russia, nevertheless, these things have to be resolved and the gas will be supplied, and the Europeans don't concede America has any right to dictate energy politics to Europe.
The bottom line is that it's not only that they want the Russian gas, they need it, you can't replace it, even the advent of LNG, the liquefied natural gas which the Americans are now exporting, can replace Russian gas in terms of volume eventually, however, it is a lot more expensive, a lot more than the piped natural gas, and the Russians have that in spades.
So at the end of the day I don't see how the Americans can actually make a difference and I think they will be ignored, which again just adds to the friction, but this is what politicians and diplomats have to do is resolve all these different interests, and the interest here, and that's the point, are very-very different, the Americans don't care about European gas problems, they just have their political goals and they are pursuing them without regard to anything else but realities and the practicalities of supplying enough energy to Europe to make it work.
Sputnik: Gazprom will be cutting hundreds of jobs overseas trading and export offices including in Britain and moving them to St. Petersburg, and at the same time we're seeing these tensions, feels like perhaps they're preparing for this and this reorganization of Gazprom is already taking place at this time when the UK and Russia are extremely at odds and are embroiled in this diplomatic row…
Ben Aris: It's a war mentality, isn't it? And at the start of the Second World War Russia moved all of its factories from St. Petersburg to the Ural mountains and a similar thing is going on. I think behind this is a preparation for the possible seizing of Gazprom assets, the Ukrainians, in particular, they were awarded a $2.6 billion dollar fine by the Stockholm court last month and there's now a dispute and it looks like Gazprom is not going to pay that.
The views and opinions expressed by Ben Aris are those of the speaker and do not necessarily reflect those of Sputnik.
The views and opinions expressed in the article do not necessarily reflect those of Sputnik.