Giving up Blue Stream-2

During the Istanbul summit on June 8 - the Conference on Interaction and Confidence Building Measures in Asia - Russian prime minister Vladimir Putin made a statement that will be directly related both to economic assessment of energy projects of the Southern Transportation Corridor and political processes in the region. According to the Russian government's head, the Blue Stream-2 gas pipeline will not stretch to Israel.

This statement in fact means Russia's complete rejection of this project, because these were Israeli consumers that it was to cater for. At least, this has been the objective over the past few years, as the initial plan to use Blue Stream-2 as an additional route for gas supplies to Europe was refused and replaced with the South Stream project. Blue Stream-2 was assigned quite a local role of delivering gas to Israel, whose relations with Russia seemed to be improving, which was manifested in scraping visa procedures.

However, just several months ago the discovery of large gas reserves in Israel was reported, which in the future may well turn this state from a gas importer to an exporter of this fuel to foreign markets. Thus, the economic incentive to lay Blue Stream-2 fell away.

Simultaneously with the economic issue Moscow's political stance changed. Russia made it clear to Israel that Moscow's hints made over the previous few months at its possible consent to imposing really serious sanctions on Iran would remain just hints. Moscow will not support tough sanctions that could rock the Ayatollah regime (a ban against buying Iranian oil and selling oil products to the Islamic republic). In this issue Russia's position is likely to be similar to that of Turkish current state authorities that adhere to moderate but Islamic views and try to raise their popularity by intentionally worsening relations with Israel. Moscow's interest is understandable - it urgently needs Ankara's consent to building South Stream in the Turkish economic zone in the Black Sea. So, due to political and economic reasons Russia is likely to support Ankara in the Turkey-Israel confrontation.

By Stanislav Mitrakhovich, NESF leading expert