Putin’s Frack Attack
What’s on Vladmir Putin’s mind? Right now it’s likely the poor performance of his party, United Russia, in recent elections and the subsequent demonstrations in Moscow about the vote’s fairness. But, in recent months, the Russian prime minister has found time to become an expert in hydraulic fracking, the technology used to extract shale oil and gas.
During a wide-ranging question-and-answer session with analysts in early November Mr. Putin became most animated on the subject of fracking, according to an account posted by Clifford Gaddy and Fiona Hill, two Russia experts, on the Brookings Institute website. Mr. Putin even drew detailed diagrams explaining how the technology works on the back of his dinner menu, according to their account, before denouncing its detrimental environmental impact. The Russian leader said fracking’s bad effect on the landscape of the U.S.’s east coast could be seen by flying over the area in a helicopter – strange, because concerns about fracking mostly center on its impact on the water supply.
Why the interest in fracking? Perhaps Mr. Putin is genuinely concerned for the U.S. environment. Or perhaps he is worried about the impact of surging shale gas supply will have on state-owned gas giant Gazprom. It makes much of its revenues exporting gas to Europe, at prices linked to oil prices. If the U.S. were able to export gas to Europe, its market dominance could be eroded; Cheniere Energy recently signed a 20-year deal to supply gas to the U.K.’s BG Group. Europe, too, could eventually produce its own shale gas, particularly in Poland. The extra competition isn’t a great prospect for Gazprom – or Russian politicians, who rely on oil and gas tax revenues to balance the books.
-Andrew Peaple
blogs.wsj.com |
