The joint research venture between the Energy Forum and The Institute of Energy Economics, Japan (IEEJ) on "Russia and the Caspian States in the Global Energy Balance" was finalized in May 2009. The joint Energy Forum and IEEJ major study on Russia and the Caspian States is a seven months study, which is scheduled to be finalized in February 2009. Russia is among the world's most important oil and natural gas producers and has the potential to enhance its status as a global natural gas supplier given its large proven reserves (the largest in the world). The country also controls through geography or geopolitics the major pathways for the export of oil and natural gas from the hydrocarbon rich Caspian countries. When both oil and natural gas exports are considered, Russia exports more hydrocarbons than Saudi Arabia. Thus, Russia's position as a major energy supplier has great significance not only for its foreign policy but for its relationships with major energy consuming countries. The nature of Russia 's future geopolitical role in world energy markets has become a major concern of international energy security with important implications for Japan and the United States. Given a range of economic and geopolitical uncertainties, the fate of Russian and Caspian natural gas exports remains a major risk factor in global energy supply. While Russia is engaged in extensive trading with Western Europe, recent events make it reasonable to raise the question whether there are scenarios under which Russia might act aggressively to challenge the existing global energy trading system. The energy strategies of Russia and the Caspian states have a critical role to play as alternative supply sources to the Middle East but it is unclear whether Russia will seek to coordinate its policies with Middle Eastern producers and how those alliances will impact the ability of major consuming countries to diversify its supply alternatives. The researchers examine several scenarios for Russian and Caspian oil and natural gas production and possible export routes.
This study was made possible through the generous support of the Institute of Energy Economics, Japan
and the Baker Institute Energy Forum Sponsors.