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Vulnerability and Bargaining Power in EU-Russia Gas Relations


  • Edward Hunter Christie
  • Pavel K. Bev
  • Volodymyr Golovko


This report contains three separate papers, each addressing selected issues concerning natural gas policy and security of gas supply in Europe. The over-arching themes are vulnerability (to supply disruptions, to supplier pricing power) and fragmentation; and measures designed to overcome them, namely interconnection and consolidation of bargaining power. The first paper contains a review of some of the economic effects of, and subsequent policy reactions to, the January 2009 cut of Russian gas supplies through the Ukraine Corridor, with a particular focus on Bulgaria and on EU policy. The second paper provides an analysis of the current state of gas relations between Ukraine and the Russian Federation, with a focus on the Ukrainian perspective and on recent political developments in that country. The third paper provides an analysis of the case for consolidating buyer power in line with the concept of an EU Gas Purchasing Agency.

Suggested Citation

  • Edward Hunter Christie & Pavel K. Bev & Volodymyr Golovko, 2011. "Vulnerability and Bargaining Power in EU-Russia Gas Relations," FIW Research Reports series III-003, FIW.
  • Handle: RePEc:wsr:ecbook:2011:i:iii-003

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    References listed on IDEAS

    1. Umbach, Frank, 2010. "Global energy security and the implications for the EU," Energy Policy, Elsevier, vol. 38(3), pages 1229-1240, March.
    2. Holz, Franziska & von Hirschhausen, Christian & Kemfert, Claudia, 2008. "A strategic model of European gas supply (GASMOD)," Energy Economics, Elsevier, vol. 30(3), pages 766-788, May.
    3. Tasneem Chipty & Christopher M. Snyder, 1999. "The Role Of Firm Size In Bilateral Bargaining: A Study Of The Cable Television Industry," The Review of Economics and Statistics, MIT Press, vol. 81(2), pages 326-340, May.
    4. Gnansounou, Edgard, 2008. "Assessing the energy vulnerability: Case of industrialised countries," Energy Policy, Elsevier, vol. 36(10), pages 3734-3744, October.
    5. Chiara Fumagalli & Massimo Motta, 2008. "Buyers' Miscoordination, Entry and Downstream Competition," Economic Journal, Royal Economic Society, vol. 118(531), pages 1196-1222, August.
    6. Silve, F. & Noel, P., 2010. "Cost Curves for Gas Supply Security: The Case of Bulgaria," Cambridge Working Papers in Economics 1056, Faculty of Economics, University of Cambridge.
    7. Jansen, Jaap C. & Seebregts, Ad J., 2010. "Long-term energy services security: What is it and how can it be measured and valued?," Energy Policy, Elsevier, vol. 38(4), pages 1654-1664, April.
    8. Greene, David L., 2010. "Measuring energy security: Can the United States achieve oil independence?," Energy Policy, Elsevier, vol. 38(4), pages 1614-1621, April.
    9. Julia Woerz & Catherine Keppel, 2010. "The Impact of the Global Recession in Europe - The Role of International Trade," Chapters in SUERF Studies, SUERF - The European Money and Finance Forum.
    10. Gupta, Eshita, 2008. "Oil vulnerability index of oil-importing countries," Energy Policy, Elsevier, vol. 36(3), pages 1195-1211, March.
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    Cited by:

    1. Rafael Fernandez & Enrique Palazuelos, 2014. "A Political Economy Approach to the European Union Gas Model: Continuities and Changes," Journal of Common Market Studies, Wiley Blackwell, vol. 52(3), pages 495-511, May.

    More about this item


    Natural gas; security of supply; supply disruption; interconnector; Russia; Ukraine; Bulgaria; European Union; energy policy; fragmentation; bargaining power; countervailing power; gas purchasing agency;

    JEL classification:

    • C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • Q34 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Natural Resources and Domestic and International Conflicts
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy

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