Russia is planning to set up a gas cartel. That will include Algeria, Qatar, Libya, the countries of Central Asia and Iran. It can be devastating for Indian and Chinese economies. It can be devasting for the world economic growth if natural gas price quadruple over the next two years.
The biggest problem comes from the fact many countries including developing countries have converted to natural gas using claen fuel technologies. They thought they can get away from the crude oil price control by OPEC. Now they face a new cartel headed by the Russia.
Regular contacts already tale place among gas exporting countries.
The world's top natural gas producers launched the Gas Exporting Countries Forum (GECF) in May 2001. The 15-member group includes OPEC oil producers Iran, Qatar, Saudi Arabia, the United Arab Emirates, Algeria, Nigeria and Venezuela, as well as leading European supplier Russia.
The group straddles about two-thirds of the world's gas reserves. Energy ministers of GECF stress the forum is a talking-shop rather than a cartel in the making.
However, the European Commission has said it is watching closely a cooperation deal agreed in August by Russian gas monopoly Gazprom and Algeria's Sonatrach company after concern it could lead to higher gas prices in Europe.
At the same time, the Commission is pressing the 25-nation European Union to adopt a common energy policy that would reduce its reliance on individual suppliers and strengthen its collective voice in dealings with Moscow.
Russia's energy might came to the fore at tense talks between European leaders and Russian President Vladimir Putin in Finland last month, where EU officials said Putin pledged to avoid a "politicisation" of oil and gas.
EU leaders sought to maintain a common front at the meeting but there are splits within the bloc between those who want to explore closer national energy ties with Moscow and those who view Russia as a neighbourhood bully using its gas power.
Poland threatened on Monday to scupper a Europe-Russia summit later this month by refusing to give its go-ahead for EU talks on a new cooperation pact with Moscow unless the bloc sought Russian commitments on food imports and energy security.
