As the US and Europe push forward with continued sanctions against Russia, an intriguing economic battle is taking shape, one which will have significant repercussions for years to come. While Washington and Brussels seek to divide Russia from Europe in order to maintain Western hegemony – blocking Eurasian integration by definition – Moscow is counteracting this strategy by leveraging its economic power in the form of energy exports and cooperation.
Although most of the economic machinations have flown under the radar, being less headline-grabbing than the conflict over Ukraine, extended sanctions, or the NATO military buildup, in reality they are equally important. Russia’s energy giant Gazprom has entered into economically and strategically critical deals with key western companies at precisely the same moment that the West seeks to isolate Russia economically. Simultaneously, Russian-sponsored gas pipelines in the North and South of Europe (as well as in Central and East Asia) complicate matters for those who would seek to alienate Russia from the European market and the potential political and economic power that access to that market brings.
From a geopolitical and strategic perspective, Russia’s ongoing conflict with the US and its European subordinates is being manifested as much in the boardrooms as in the halls of parliaments; as much under the Baltic and Black Seas, as in the war rooms of the Pentagon and Kremlin.
It’s the Economics, Stupid
Amid the panels and discussions about the development of BRICS, Eurasian integration, and New Silk Roads at the St. Petersburg International Economic Forum, a massive energy cooperation deal was signed, one that should be seen as a major coup for Moscow. An agreement between the world’s top gas producer, Russia’s Gazprom, and Royal Dutch Shell, to build two new Nord Stream gas pipelines to Germany will have major implications for the future of economic cooperation between Russia and European energy firms. Moreover, it will further cement Russia as an integral partner for German industry, the heart of Germany’s economy.