By Michelle Fitzpatrick - 25th April 2006
Europe’s energy supply worries are expected to be high on the agenda in during week’s German-Russian talks.
Leaders of both countries are meeting in the Siberian city of Tosmk for discussions that are sure to focus on energy supply.
Berlin and Moscow are set to sign a deal developing a Russian gas field but talks also follow veiled threats that Russia could cut gas and oild supplies to Europe.
German chancellor Angela Merkel is travelling to meet Russian president Vladimir Putin on Wednesday afternoon.
Discussions look set to focus on European concerns over recent threats from Russia’s gas giant Gazprom and oil pipeline monopolist Transneft to cut European energy supplies.
Putin told the assembled word press that Russia, the world’s second largest oil supplier, “has to struggle against unfair competition too often”.
The country will therefore focus on supplying oil to Asia starting with the construction of a 4000 km pipeline to China.
Merkel and Putin are also expected to attend the signing of an agreement between Germany's BASF and E.ON and Russia's state-owned Gazprom to develop the Yuzhno-Russkoje gas field with reserves sufficient to meet Germany's demand for seven years.
Today, Russia delivers over one third of the oil consumed in Germany. This is set to increase with the new gas field, fuelling concerns that Germany will grow increasingly dependent on unreliable Russian oil.
Deutsche Welle quotes energy expert Friedemann Müller, who said that it is unlikely Russia will shut down its pipelines to Europe in the near future.
"Russia and Europe are dependent on each other," he said.
"While it would take decades for Gazprom to build pipelines to Asia, Europe’s demand for gas would still outstrip Chinese and Indian orders.
"That’s why Russians need the EU as a market in the long term. But that doesn’t keep them from flexing their muscles," he added.
Accompanying Merkel on her Siberian trip is a high-calibre group of businessmen eyeing up new opportunities in Russia.
Also on the German-Russian agenda will be the current nuclear crisis in Iran.
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