Vladimir Putin is like your boss: you don’t
like him, you don’t trust him, but you need him to pay your bills. It’s been a long time since we’ve talked about Putin here on VisualPolitik and… I know what are you’re
thinking now. Again, Simon? Are you going to talk about OIL? Well not this time! Today
we are going to talk about NATURAL GAS! Many of you might think these are very similar
things. At the end of day, countries with oil reserves usually have gas reserves too.
But there is a difference. Oil markets are way more diversified. For example: Europe
buys 30% of their crude oil from Russia but, when it comes to gas, the number rises to
40%. But, if we look at each individual European country, the dependency is way higher. Germany
imports 60% of their gas from Russia and other countries like Finland and the Baltics depend
entirely on Russian gas. In other words, Putin could leave these countries freezing on a
cold, cold winter night that would make Game of Thrones look like Baywatch.
But wait a minute because there’s more to this resource than heating! In fact, we need
natural gas for many other things. Domestic consumption is just a third of the total.
As you can see on this chart, another third is for thermal power plants. But the biggest
share is used by various industries. For example, a paper manufacturing company needs thermal
energy. This means… heat! In order to get this heat, the factory uses gas. And the same
goes for many other industries. In other words, gas is extremely important
to everybody, and that includes Europe. And guess who’s the biggest gas consumer in
all of Europe? Of course, that would be Germany: the most populated country on the continent
and also, the one with the biggest economy. And this is the key of the story. Because,
as long as Germany remains so dependant on Russia, all of Europe will depend on Russia
too. And this is why, during the 2018 NATO summit, Donald Trump said things like this.
“Germany is totally controlled by Russia, because they will get from sixty to seventy
percent of their gas on a new pipeline. And you tell me if you think that’s appropriate
because I think it’s not… and I think it’s a bad thing for NATO”
So the question today is… Is Trump right when he criticizes Germany? Is it really a
problem that Germany has such a high dependency on Russian gas? And more importantly… is
there a true attempt to reduce that dependency? Today we are going to answer to all of these
questions but, before we do, let’s take a look back at history.
OUR MAN IN BERLIN There are two ways of transporting gas. The
cheapest one is through a pipeline. This means, we build a huge pipe that goes from the place
we take the gas, say the Yamal Peninsula in Russia, to the country that buys it, say Germany.
This is very cheap because you just need to build the pipe and… There you go! You don’t
need trucks, ships or things like that. Since you transport the gas through pipes, it comes
to the power plants, the houses, and the factories directly.
There is also an alternative method: so-called Liquified Natural Gas or LNG. How does this
work? Well, let’s say we take the gas from Qatar. Then, we lower its temperature until
it reaches -161 ºC. This is the point when the gas becomes liquid and you can store it
in bottles. These bottles can be stored in a ship and sent to… let’s say, the Barcelona
dock, in Spain. There they have a re-gasification plant where they heat the liquid until it
becomes gas again. This gas goes to the national pipe net and that’s when it’s transported
to houses and factories. What is the advantage of this process? Well… it allows Europe
to Diversify their gas providers easily. The problem? It is 50 to 70% more expensive than
the pipelines. And this is why European countries buy their
gas from the closest producers using pipelines. For example, the biggest supplier for Spain
is Algeria. But the Northern countries buy gas from Norway and, especially, Russia. As
we said before, companies like ROSFNEFT or LUKOIL export more than half of the gas consumed
in Germany… and what about the countries located between Germany and Russia? Well,
they have an even deeper dependency. Just look at this map.
If you pay attention, you will see how Poland depends on Russian gas for 75% of their needs.
Others like Finland and Romania go to 100%. In other words, half of Europe needs Russia
in order to survive. And this is not a secret. The European Commission knows about it, Vladimir
Putin knows about it, even HE knows about it…
Germany will become totally dependent on Russian energy if it does not immediately change course.
Here in the Western Hemisphere, we are committed to maintaining our independence from the encroachment
of expansionist foreign powers But let’s pause the video here for a moment.
Right here, where we can see the German delegation laughing at Trump. He just said that Germany
WILL become totally dependant on Russian energy. This means, if they were already dependent…
they will become even more dependent. What is he talking about exactly? Well… let’s
rewind the video. Remember this name GERHARD SCHRODER *GERARD
ŠREDER*. He is the former German chancellor, the predecessor of Angela Merkel. He still
maintains a massive influence in German and European politics. And… what does he do
now? Well… he’s building this. FORMER NATO CHIEF RASMUSSEN
Germany walks into Putin’s trap – Nord Stream 2 ))) Basically, Nord Stream 2 is a brand new pipeline
that would go under the Baltic sea, connecting Germany and Russia with no middle man. With
this new pipeline, Germany could double their imports of Russian gas. And this project has
a shareholder committee with companies like the Russian GAZPROM. And… the president
of this committee is, of course, Mr. SCHROEDER. If this wasn’t enough, the former German
chancellor is the president of ROSNEFT, a Russian oil company.
This is why, in the last 10 years, SCHOEDER has become Putin’s man in Europe. In fact,
he has defended Russia in all kinds of matters, from the cyber attacks against the Estonian
government to the Crimean invasion. In other words, far from reducing their dependence
on Russia, Germany is going in the opposite direction.
So… what were those German laughing about? Honestly… I have no clue.
But OK, OK, I know what you’re thinking now… What’s the problem with depending
so much on Russia? Is it the fact that Putin is an authoritarian
ruler? Seriously? Oh come on! If this was a problem, then we could hardly buy gas from
anybody else. Among the list of suppliers we have AZERBAIJAN, ALGERIA, QATAR… of course,
these are all healthy democracies governed by the Sisters of Mercy.
Of course, nobody cares about democracy and human Rights when it comes to having heating
in their homes. The problem with depending on Russia is something else. You’ll understand
what right now. RUSSIA-HOLICS
In the year 2006, Gazprom wanted the Ukrainians to pay 6 times more for gas. This was a 100%
political move. For decades, Russia and Ukraine had a really good relationship… and then
the orange revolution began. When VIKTOR YUSHCHENKO came to power with his anti-Russian and pro-European
rhetoric, the Kremlin said… (((READ THIS AS IF YOU ARE SUPER JEALOUS)))
Oh, I get it, Ukraine! So you only wanna hang out with your cool European friends now, huh?
Well, get your wallet ready because it’s not going to be cheap.
Think about it… building a brand new pipeline with another country takes years. So Ukraine
couldn’t just find new suppliers overnight. If Putin wanted, he could raise prices at
will. And if Ukraine doesn’t want to pay… Russia can just close the pipe.
For three days, in the middle of a cold wave, Ukrainians had no heating at home. And after
a tense negotiation, Ukraine agreed to pay double for the gas. In exchange, they raised
the fee that Russia had to pay in order to cross their country to send the gas to the
rest of Europe. But this was just the beginning. In the year
2009, we had the same problem but… king sized. Russia wanted Ukraine to pay more for
their gas… again. Kiev and Moskow started insulting each other. And in this case, it
was not only Ukraine that went without gas for days. It was also the rest of Europe:
and that included the Czech Republic, Italy, Poland and, of course, Germany. Yes, my dear
viewers, most of that Russian gas comes through Ukraine so… if Ukrainians have no gas, chances
are, other Europeans will be freezing too. Again, the story ended with Ukraine paying
more for their gas in exchange of more transport fees. Nevertheless, just like Game of Thrones,
Putin’s tune is a Song of Ice and Fire. After freezing Europeans in 2006 and 2009,
2014 was the year of fire. And the fire came in a Ukrainian province called Crimea. As
you know, Russians took Crimea. And what did the European Union do in this
case? Well, they just came to Putin and said… ‘Putin, you are a very very naughty boy!
We will sanction you and… you will write this line 20 times: ‘I will not invade other
countries’’. And this was the end of the story. Now, Ukraine is more of a headache
than anything else. But we’ll cover this in the next video of this series. Because,
yes, there will be a whole series about Russian gas. If you don’t want to miss it, you know…
subscribe and click on the bell button. So now, Europe has two options. Putin and
Schroeder want to build new pipelines to bypass Ukraine. That is the first option. The second
one is what the European Union wants: to find other gas suppliers… but… Can they really
do that? Pay attention because we’re going to see right now!
ATTEMPTS AT DIVERSIFICATION The fastest way of diversifying is, you guessed,
buying Liquefied Natural Gas. Of course, it is expensive but countries don’t need to
wait to build brand new pipelines. So what’s the problem here? LNG ships are too busy with
the Asian markets. Basically, the Pacific Ocean is full of these ships that go from
Australia, Qatar and Malasia to Japan, China and Korea. You see… in Asia, gas prices
are way higher than everywhere else. So good luck convincing America or Qatar to sell you
their gas when they’re getting rich off of Asia.
This is why the most realistic option is to build new pipelines. The question is… where?
On one hand, we have Norway. But Europe already buys all the gas they produce. Going down
South, Spain wants to build the MIDCAT, a pipeline that would connect Algeria with Northern
Europe. But France is not very excited about the idea because they would have to build
the whole net to sell to other countries. And, you know…
‘oh man… this is so much work… maybe tomorrow, or well, not tomorrow because I
already have plans… maybe next week’ The most serious alternative so far is the
so called TRANSADRIATIC PIPELINE or TAP, which is meant to be finished by 2020. This pipe
goes from Azerbaijan, crosses Turkey and goes all the way to Italy.
But wait a minute because this still isn’t enough! This pipeline has a maximum capacity
of 20 billion cubic meters of gas. This isn’t even half the capacity of the Nord Stream
2 that connects Germany and Russia. But… this is not the only problem. When
it comes to oil, Putin is a very jealous boyfriend. And if you thought he would put up with so
much gas promiscuity… you are very wrong. Gazprom says gas transit via Ukraine to Europe
may fall to 10-15 bcm per year With this move, Putin kills two birds with
one stone. First, he’s forcing Europe to follow him. And on top of that, he bypasses
Ukraine. But this is not the end of the story! In the South, Putin is also pushing to build
brand new pipes. And, my dear viewers, if you thought GERHARD SCHROEDER is the only
friend of Vladimir Putin in Europe… you are very, very wrong.
Hungary wants Russia’s Turkish Stream pipeline to be extended into Europe
But there are still two points we haven’t dealt with here. For one, we have to talk
about Ukraine… Can Putin totally bypass them? On top of that, we should talk about
AZERBAIJAN, another dictatorship that will become Europe’s best friend. So, if you
don’t wanna miss those stories, subscribe and hit the bell button.
Meanwhile, here is a question for you… do you think Putin can reduce its dependency
on Russia? Or do you think Putin will become the Night King, with enough power to turn
Europeans into white walkers? Please, leave your answer in the comments section below.
And visit the RECONSIDER MEDIA PODCAST, the podcast that provided the vocals in this episode
that were not mine. If you liked this video, give us a thumbs up and, as always, I’ll
see you next time!