EU Inaction on Nord Stream 2 Leaves Moldova Vulnerable

The efforts of the President of Moldova, Maia Sandu, to deepen her country’s ties with the European Union received a significant boost this summer. The victory of the Action and Solidarity Party over the pro-Russian bloc in a snap Moldovan parliamentary election puts the pro-Western president in a strong position to implement her anti-corruption reforms. 

The legislative pathway now seems clear for Moldova to advance its European integration plans following a period of deep East-West political divisions that have plagued the country since the collapse of communism in 1991. However, the energy sector is an area in which Moscow can still maintain a political foothold in the landlocked post-Soviet state. 

EU helpless in face of Moldova’s energy dependence on Russia

Despite the pro-European political orientation of its government, the sole reliance on a single natural gas pipeline running from Russia via Ukraine makes it difficult for Moldova to escape Moscow’s orbit. 

As a result of the stronger-than-expected economic recovery from the Covid-19 pandemic, demand for natural gas surged across the world. This left Moldova particularly vulnerable to Russian political pressure. By deliberately withholding additional gas shipments on top of long-term contracts, the Russian state-owned gas company Gazprom choked Moldova’s gas levels to undermine the position of the pro-western administration in Chisinau. 

After the Moldovan prime minister, Natalia Gavrilita, stated that energy supplies in her country had reached critical levels, Chisinau had no other alternative but to enter into negotiations with Gazprom on a new deal. Russia acted quickly to exploit the vulnerabilities in Moldova’s post-Soviet energy infrastructure.

According to the Financial Times, Moscow told Moldovan officials that it was prepared to offer cheaper gas deliveries if Chisinau withdrew from its free trade agreement with the EU. It also demanded the Moldovan government to abandon its alignment with EU rules on gas market liberalisation, which would hamper Gazprom’s effective monopoly over Moldova’s gas supply.

Although the new 5-year agreement between Gazprom and its Moldovan subsidiary, Moldovagaz, put an end to the gas crisis in the landlocked country, it raises questions about the prospects of Moldova’s EU accession. If the Sandu presidency wishes to fulfill her plans on European integration, Brussels will have to do more to address Europe’s energy dependence on Russia.

Why the EU needs to act on Nord Stream 2

The construction of Nord Stream 2 does carry implications for European energy security that the EU will have to take into account. Berlin insists that the new pipeline running through the Baltic Sea from Russia into Germany is a purely commercial project that serves to protect EU energy supplies in case of a deterioration in Russian-Ukrainian relations following the 2014 Crimean annexation and ongoing conflict in the Donbas. Despite Germany’s understandable reasoning, Nord Stream 2 exposes the vulnerabilities of Moldovan energy dependence on Russia.

Russian gas running through Ukraine currently serves 99% of Moldova’s energy needs. Since Nord Stream 2 would allow Russia to bypass Ukrainian gas transit flows that Moldova relies upon, the former Soviet state stands to lose its sole source of energy. This means Moscow has more room for manoeuvre to guarantee Moldovan energy security in exchange for concessions from Chisinau on its EU accession intentions. Poland was quick to recognise Moldova’s precarious geopolitical position. Andrzej Duda, the president of Poland, announced that his country would be prepared to continue supporting Moldova’s energy diversification after Chisinau received its first non-Russian gas shipment from the Polish gas company, PGNiG. Nonetheless, current EU efforts to mitigate the energy security risks associated with Nord Stream 2 have found difficulty in reassuring Eastern European concerns. 

Germany successfully secured the approval of Nord Stream 2 from the US in a meeting between German Chancellor Angela Merkel and US President Joe Biden at the White House. Merkel managed to negotiate the reversal of America’s long-standing opposition to the pipeline in exchange for a promise to impose fresh sanctions on Russia if Moscow threatens to compromise Ukrainian energy security. However, this German pledge fails to alleviate Eastern European concerns over the newly-acquired leverage Russia would enjoy if the pipeline goes into operation, according to a Polish-Ukrainian joint statement. Moreover, Yuriy Vitrenko, chief executive of Naftogaz, Ukraine’s main oil and gas company, stated that Putin’s intention is to use Russian gas as a way to negotiate ‘special conditions’ with European countries.

Meanwhile, there is no guarantee that the transatlantic alliance can act on behalf of Eastern European interests on the matter of energy security. The forthcoming NATO Strategic Concept plans to refocus away from its postwar role of protecting the Western hemisphere from the Soviet threat towards countering the rise of China. This means that the EU may now have to take on greater responsibility to deal with Moldovan concerns about its energy security and maintain Moldova’s current EU-focused geopolitical orientation.

The European Green Deal: a possible framework of EU support?

The process of achieving net zero carbon emissions in the EU by 2050 under the Commission’s European Green Deal may offer a practical way forward for Moldova to deepen its ties with Europe in the face of Russian pressure. Its neighbour, Ukraine, has a wealth of untapped green energy potential in hydrogen and wind power production, according to an International Energy Agency country report released last year. 

EU investment in Ukrainian green energy infrastructure and existing gas storage and transportation facilities could help Moldova shake off its dependence on Russian gas and transition to Ukraine’s renewable energy resources. Following a period of rapid modernisation of its energy capacities, Naftogaz is well-placed to facilitate this shift. However, investment will need to be done so in a way that ensures renewable energy meets the demands currently served by Gazprom.

As things stand, Moldova is left in a vulnerable position. Until the EU responds to the implications of Nord Stream 2 for European energy security, Russia will be able to continue using gas as a tool to severely undermine Moldova’s efforts to escape its sphere of influence.