Guest Post: Gazprom - Angel Or Demon?

Tyler Durden's picture

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Daedal's picture

Russia is often referred as the “Wild East” in a reference similar to the U.S. “Wild West” when people and companies operated in a semi-lawless environment.  Russia has laws but its judiciary remains weak and corruption is deeply ingrained. The lack of accountability in Russia that permeates through the society enabling anyone to do as they please goes on par with the dismissive attitude towards the rule of law, which President Dmitry Medvedev calls “legal nihilism,” namely Russians’ tendency to disregard the law.

Perhaps I digress, but how many banksters and climatoligists have gotten prosecuted lately? Medvedev's comments, while made in the context of reflection on Russia, are actually very descriptive of modern Global and American attitudes.


iRidiculous's picture


"Don't try, you'll never ever find, a surer friend than Gazprom!"

"Let's drink to you, let's drink to us, let's drink to all Russian gas, that it never comes to an end, though it's so hard to obtain!"

sangell's picture

Is Gazprom a company or an agency of the state is the question I suppose. I don't know of many western oil companies that manage to have their rival's CEO tossed into prison.

Anonymous's picture

In reality it's both as the state's stake is over 50%. As a sidenote, Yukos wasn't actually a rival

greased up deaf guy's picture

it's totally different here. instead of throwing people in jail, we pick and choose which companies to save while allowing their competitors to die. and no companies are an agency of the state here either. it's waaaaaaaaaaaaay different. (sarcasm off)

Assetman's picture

Relative to Vladamir Putin, angel.

Otherwise, demon.

DaveyJones's picture

"Gazprom faces regular opprobrium for its bullying ways of using energy as a pressure and political tool...Gazprom could say the same in light of its commercial power and the unconditional governmental backing it enjoys...Gazprom has an uncanny ability to do things that are morally reprehensible by Western standards and to be oblivious to the critics that ensue"

Good thing our oil companies are nothing like this. Imagine invading some poor country for nothing more than its energy resource. They're so beneath us.

Lucifer started his career out as an angel.

Steak's picture

<According to the U.S. Energy Information Agency, Gazprom was planning in 2008 to invest around $45 billion in 2010 just to maintain production at its top four gas producing fields has been declining.>

As I understand it declining production is the most pressing concern in the Russian energy sector.  Yes being a global energy company is a full contact experience with many conflicting interests.  It is therefore hard to pass any sort of moral judgement against these companies tactics when it can easily be said they are looking out for national interests.

Where problems arise is when lack of transparency, strongarm tactics and profits as secondary concerns lead to a broader incompetence in these companies.  Drilling for oil is not like banking.  You can't screw up and ask for a bonus.  If you don't strike oil or if the well you were rehabilitating collapses, then everybody loses.  But that is what happens when an organization values political connections over technical skill.

I contend that Gazprom is a demon if only because their tactics will likely lead to a less technically adept workforce.  That will hurt Russia and the global energy market.

Anonymous's picture

and I think that you're full of it

Anonymous's picture

Nabuco is a pure dream.

FoolMeTwice's picture

Look within and find likes of Haliburton and Blackwater.

carbonmutant's picture

This is the Russian version of "Doing God's Work"

"Black ops capitalism" as a state tool.

THE DORK OF CORK's picture

I think it is generally accepted within the corridors of power in Berlin and other European capitals that the abandonment of nuclear power after the the rise of monetarism was the single worst strategic mistake made in the European energy sector.

Germany and others are now dangerously reliant on Russian natural gas and yet large sections of the population are irrationally against nuclear fission , so populist governments pursue "green energy" projects such as wind and solar which gives people a nice warm fuzzy physiological glow inside but I am afraid will not keep them warm in winter.

There is still a neo-liberal belief that efficient markets can supply the most efficient reliable energy but decades of flawed policey speak for themself - we are now reaching the end life of many power plants but the only response is to build gas powered power stations - this is madness or stupidity or both. 

Anonymous's picture

The free market will provide. You can do conferences hammering that mantra in the US and make a lot of money doing so.

stouche's picture

What happens if natural gas reserves begin to run out and Gazprom turns to the Russian gov't for help? Would the people support gov't bailouts of Gazprom again?

Anonymous's picture

I think of GS as Goldprom.

Anonymous's picture

> That did not prevent Gazprom from bluntly cutting the gas
> supply to Ukraine in January 2009 over non-payment issues
> and quantities to be supplied, impacting 18 European
> countries in the mix in the midst of a cold winter.

Complain to USA which helped Yuschenko to become the
president of Ukraine, inserting marionetka to screwup
with EU energy sources supply every time they need.

Complain to Ukraine which started to steal EU's gas
in January 2009.

But we don't care about that.

Russia/Gazprom is to blame.

> Even the Soviet Union did not tamper with gas supply,
> knowing how important the energy cash machine was to its
> economy and survival.

Soviet Union didn't have bought by USA pro-nazi President
in Ukraine, that's the key difference.

> Those cuts prompted (i) end-user countries to find
> alternative suppliers

Seeing what e.g. Poland does to Russia, like
banning USSR symbols, teasing with anti-nuclear defense,
and doing all sorts of anti-Russian BS, I personally
wouldn't mind if Poland government would be told
to piss off permanently and start finding "alternative
suppliers" al they want.

Chopshop's picture

what an excellent piece.  just fantastic; Commanding Heights good.  great work!

Anonymous's picture

and accounting for about 25% of Russia’s federal tax revenues according to pre-crisis data, Gazprom has a unique leverage and has no qualm about flexing its muscles.
typical idiot who knows nothing about nothing..
RUSSIA budget was about $500 bln or 15 trln rubles pre-crisis..
( down 20 % in 2009)..

GROSS SALES OF Gazprom about 100 bln $ ( gross sales).. they paid probably 20-30 % in taxes.. thus 20-30 bln $.. so
its only 5-6 % of Russia budget...