FT: Russia’s South Stream gas pipeline to Europe divides EU

Russia’s determination to start building a major gas pipeline into Europe next month regardless of opposition from Brussels has laid bare the EU’s disunity in confronting Moscow.

Officials in Brussels insist that South Stream, a pipeline that would run from the Black Sea to Austria, offers the EU a weapon against the Kremlin as the crisis in Ukraine deepens. In the European Commission, officials are considering how they can leverage competition law to thwart the project by limiting the volumes of gas that Russia’s Gazprom can export via the pipeline. The European Parliament voted last month that South Stream should not be built.

But Russia has launched a counter-attack, playing on the depth of Europe’s commercial ties to Russia and exploiting the conflicted loyalties of member states. This week, Gazprom signed a preliminary deal with the energy company OMV to build a spur of South Stream into Austria.
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