On Wednesday, May 27, 2015, The German Marshall Fund of the United States (GMF) hosted U.S. Department of State Special Envoy and Coordinator for International Energy Affairs Amos Hochstein for GMF’s eighth installment of its Transatlantic Talks series. The series pairs government officials from one side of the Atlantic with senior journalists from the other to discuss the most relevant issues to the transatlantic partnership. Laure Mandeville, the U.S. bureau chief for Le Figaro, moderated the conversation, which explored prospects for U.S. and European energy security and cooperation, in light of the G7 meeting earlier this month. Senator Richard G. Lugar, senior transatlantic fellow at GMF’s Lugar Diplomacy Institute and president of The Lugar Center, welcomed the audience and introduced the event.
In his opening remarks, Senator Lugar noted that “continual deepening and widening of the [transatlantic] Alliance is required to meet the economic, diplomatic, and military challenges of today and tomorrow.” Transatlantic cooperation on energy security is critical and the role for diplomacy is as strong as ever. Senator Lugar highlighted that transatlantic energy partnerships could be strengthened through renewed commitment to expediting LNG permitting to Europe and further focusing attention on energy in the Transatlantic Trade and Investment Partnership (TTIP) negotiations.
Following remarks from Senator Lugar, Mandeville began the conversation by asking Special Envoy Hochstein if he was worried by Russia’s use of energy sources as a geopolitical weapon in Europe. To this question, Hochstein responded that he was indeed concerned, but that it “is not about whether I’m worried, Europe should be worried --- all of Europe should be worried.” Hochstein insisted that dependence of a region on a country or neighbor for its most essential needs cannot be met idly. Energy is a critical resource that supports almost everything in economic development. In the case of Russia, Hochstein stated that it should continue to be an energy supplier for Europe, but that it needs to become an equal player. According to Hochstein, Russia should not be able to use its political and financial resources to preclude other sources from competing in the market.
Regarding concerns about Russia’s proposal to add a Greek leg to “Turkish-Stream,” Hochstein stated that “we need to be cognizant of what all these moves mean.” He continued by saying that policies cannot be viewed independently from each other. In the case of Greece, there is an interplay of economic interests, energy interests, and political interests. Trying to address each independently of the others will not be sufficient.
The second half of the discussion included questions on prospects for American LNG exports to Europe, the potential removal of Iranian oil and gas sanctions, and Turkey’s energy role in the Eastern Mediterranean. In regards to the latter, Hochstein stated that he has never been more optimistic about energy development in the Eastern Mediterranean and the possibility of using these resources as an incentive, not a foundation however, for broader cooperation.
In closing, Hochstein brought to light the fact that the international energy market is going through a complex transformation. The boom of shale production in the United States has brought a democratization of pricing in the oil sector that has led to the new reality that “OPEC doesn’t drive the price any more the way that it did in the past.” The emergence of new gas suppliers, including the United States, he concluded, will have a positive benefit for Europe, even if American LNG supplies do not reach European shores.