This is the text of a speech delivered in St Petersburg at a conference organised by the St Petersburg State University of Economics and Finance, 'Energetika XXI: Economy, Policy, Ecology'.
- The energy relationship between Russia and the EU is interdependent, but it is not balanced. Whilst the EU as a whole does not suffer from excessive dependency, a number of states within the EU are heavily dependent on Russian gas.
- Visionary pipeline projects bypassing Russia will not be a substitute for modernisation, investment in interconnectors and storage, new exploration techniques and new energy sources.
- The EU's strategic challenge is to make interdependence with Russia work. This will not succeed until the EU is able to enforce its own standards of transparency and competitiveness and ensure that Europe's relatively liberal energy market is protected against interests and interference of a non-commercial nature.
- Neither will it succeed unless the framework governing sale and transit of gas between Russia, Ukraine and Europe is overhauled.