The New Map: Energy, Climate, and the Clash of Nations

by Daniel Yergin

In late 2015, four years after Nord Stream started operating, surveyors began to map out a second pipeline route under the Baltic Sea from Russia to Germany. Opposition to Nord Stream 2, as it was known, was much stronger than against the original Nord Stream. Part of the reason was what had happened in between—specifically, Ukraine. Criticism came from parts of Europe, notably Poland and the Baltic countries, as well as the European Union itself—a turnaround from its supportive position on the original Nord Stream. Donald Tusk, president of the EU Council, was already warning, “Excessive dependence on Russian energy makes Europe weak.” Maroš Šefčovič, EU vice president, put Nord Steam 2 high on the list of “hybrid threats.”

That was not, however, how other Europeans, including German chancellor Angela Merkel, saw Nord Stream 2. It was a commercial project, she said, and up to the companies involved—Gazprom and its European partners. In March 2017, the first pipe arrived at a logistics hub in Germany. But the proponents of Nord Stream 2 had not factored in what was unfolding in Washington.

joint task force from the CIA, the National Security Agency, and the FBI concluded “the Russian government pursued a multifaceted influence campaign” in the 2016 election that included “aggressive use of cyber capabilities” and that “President Putin directed and influenced the campaign to erode the faith and confidence of the American people in the presidential election process” and “demean Secretary Clinton” and “advantage Mr. Trump.”

There was an assumption among some in Washington that if the pipeline was not built, it would reduce Russian gas going into Europe. But that was not correct. The gas would simply flow through other pipelines, including those in Ukraine and Turkey.

While the eastern members of the European Union wanted new sanctions aimed at stopping Nord Stream 2, the rest of the continent reacted differently. “Europe’s energy supply is a matter for Europe, not the United States of America,” said Germany’s foreign minister and Austria’s chancellor in a joint statement. “Instruments for political sanctions should not be tied to economic interests.” It was difficult for Europeans to see the connection between Russian meddling in U.S. elections and a natural gas pipeline in Europe.

Wolfgang Ischinger, the chairman of the Munich Security Conference and the former German ambassador to the United States, observed that Americans would be highly riled were Brussels to pass legislation to block an oil pipeline from Canada to the United States. Ischinger also pointed to a fundamental lesson of sanctions—they are more likely to succeed when they are multilateral. Unilateral sanctions create rancor among allies. The biggest beneficiary of conflict between the United States and the EU over

sanctions would be Russia, which would warmly welcome a more divided West.

The outlines of a deal over Nord Stream 2, at least in Europe, were becoming evident. The pipeline was not “just an economic project,” said Chancellor Merkel in the spring of 2018. “Of course, political factors must also be taken into account.” What she had in mind specifically was that a certain amount of gas would be guaranteed to flow through the Ukrainian system. For its part, Gazprom signaled that it would maintain some level of exports through Ukraine. But in Washington, thirty-nine senators called on...

It turned out that the bluntest critic of Nord Stream 2 was Donald Trump. Across a breakfast table from NATO’s secretary-general, he declared, “Germany is totally controlled by Russia because they’re getting 60 to 70 percent of their energy from Russia in a new pipeline. You tell me if that is appropriate. I...

At this, Chancellor Merkel took personal umbrage, having grown up in communist East Germany under the omniscient eye of the Stasi secret police. “I have experienced myself how a part of Germany was controlled by the Soviet Union,” she shot back. “I am very happy that today we are united in fr...

Not deterred, Trump renewed the attack via Twitter: “What good is NATO if Germany is paying Russia billions of dollars for gas and energy?” Meeting with the European Commission’s president, he promised that the United States would sell “massive” amounts of LNG to Europe. Yet around that time, in the shallow waters off Lubmin, Germany, pipes were being dropped into place for the first eighteen miles of the 840-mile underwater pipeline.7 A year and a half later, in December 2019, the $11 billion pipeline was only weeks away from completion. On December 9, Putin was in Paris to meet with German chancellor Angela Merkel, French president Emmanuel Macron, and Volodymyr Zelensky, the new president of Ukraine. Zelensky had become famous in Ukraine for his popular television comedy show “Servant of the People,” in which he played a schoolteacher who accidentally becomes Ukraine’s president. Now he actually was president, elected with 73 percent of the votes in April 2019. Zelensky described this, his first meeting with Putin, as “a tie for now.”

A week later, on December 17, the U.S. Senate passed a multibillion-dollar defense bill. Sanctions on Nord Stream 2 were tacked onto

Three days later, on December 20, to the surprise of many, word got out that Russia and Ukraine had concluded a settlement of what had seemed to be their endlessly acrimonious natural gas battle. It was more than a “tie”; it was the deal that Ukraine could only have hoped for: Russia guaranteed five years of volumes of natural gas to Europe through Ukraine, which would assure a level of transit revenues. Even more surprising, Russia agreed to pay Ukraine a $3 billion a...

Some few hours after the Russians and the Ukrainians had finally settled their long-running conflict, Donald Trump, at Andrews Air Force Base in Maryland on his way to Florida, signed the defense bill, imposing sanctions on the Nord Stream 2 pipeline.

The sanctions targeted just one company—a Swiss firm that owned the pipe-laying barge, at the time the only one of its kind in the world equipped for this project. The barge stopped work almost at once; the company had no choice but to comply.

Both Germany and the European Union expressed outrage at what they saw as extraterritoriality and America’s illegally intervening in Europe’s domestic affairs. “This is a very important project,” said Chancellor Merkel. “It has been legitimated by the new Europe law. We need to carry it through.” For its part, Gazprom responded that it would finish laying the pipe itself. But not quickly. It had already bought a pipe-laying barge as a precaution, but it would take many months to properly outfit the ship for the job. There were new legal challenges and threats of new sanctio...

The Groningen gas field

in northern Holland, discovered in 1959, was the biggest domestic source of gas within Europe, and the foundation on which the original European gas system had been built. It still ranks among the top ten gas fields in the world. But its days are numbered. Owing to its particular geology, production over many years has led to subsidence, sinking of the topsoil, which has triggered tremors and earthquakes, causing cracks and damage in houses. The Dutch government has imposed severe restrictions on production and a likely total shutdown by 2022.

This would not affect new discoveries of the Netherlands’ offshore, but it would mean that Europe would lose what had been its largest domestic source of gas. Europe will need additional imports. Some will come from Azerbaijan through a new pipeline system that reaches into Italy. Some might come from Israel and Cyprus. Some would come from LNG. But Russian gas, whatever the route, would also benefit from the declining domestic production. Yet the concern about Russia’s potential leverage from gas exports does not fully recognize how much both the European and world gas markets have changed. The gas market in Europe has become a real market of buyers and sellers, rather than a system based on inflexible long-term contracts. And LNG has become a truly global industry—one that, declared the European Union, “can give a real boost to Europe’s diversity of supply and hence greatly improve energy security.”

There already were a number of terminals in Western Europe to receive the LNG, regasify it, and inject it into the European pipeline system. But not in Eastern Europe. The first country to remedy this was Lithuania, which was completely dependent on Russian gas and was paying higher prices than other countries. It opened its first LNG receiving terminal in 2014. At the ceremony, the country’s president described the facility as “a guarantee not only of our energy but also of our economic independence.” She added that Russia would “no longer be able to exert political pressure” by manipulating gas prices. Just to be sure that no one missed the point, the terminal was christened “Independence.”

year later, Poland, also until then totally dependent on Russian gas, opened a much larger LNG import terminal.

Europe now has more than thirty receiving terminals for LNG, which can be ramped up on short notice. They are also part of an increasingly dense global network. Worldwide, over forty countries now import LNG, compared to just eleven in 2000. Exporting countries have increased from twelve to twenty. Overall global LNG demand in 2019 was almost four times larger than in 2000, and liquefaction capacity is expected to increase by another 30 percent over the next half decade.

long as warfare continues in Ukraine, politics will fuel rancorous discussion of European gas. But with Europe now part of a global market, political risk is draining out of Europe’s gas supply.

Ukraine is no longer directly dependent on Russian gas, but rather imports gas that may or may not be Russian molecules through Slovakia, Hungary, and Poland. Moreover, domestic production supplies about two-thirds of total demand, and the share could go higher, as Ukraine may possess the largest natural gas resources of any country in Europe. Some 80 percent of current production comes from the state-owned gas company. The second-largest among the private firms is a company called Burisma. It represents just 5 percent of domestic production, but it has gained oversized fame outside the energy sector.

It is the company that Donald Trump wanted investigated in Ukraine, owing to the fact that Hunter Biden, son of former vice president Joe Biden, sat on its board. It was that famous “quid pro quo”—linking the provision of U.S. aid to an investigation of the company and ...

The “near abroad,” as Moscow called

Central Asia—encompassing what are now Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan, plus Azerbaijan—was the very center of the Eurasian landmass that one of the fathers of modern geopolitics, Halford Mackinder, in a famous address to the Royal Geographical Society in 1904, had identified as the “geopolitical pivot of the world”—the “heartland.”

In the years following the collapse of the Soviet Union, Moscow was determined to ensure that these Central Asian countries remained in Russia’s privileged sphere, despite their new independence. The United States,

some Russians insisted, had engineered the collapse of the Soviet Union to build a band of independent states that would keep Russia weak—and get its own hands on Caspian oil. For the United States and Europe these new nations were independent countries that should be permitted to develop their own identities and economies. That was what life was meant to be like in the globalized world after the Cold War. Moreover, if these countries were weak and unstable, they would fall back into Russian hands or become prey to neighboring Iran. For some of the countries, oil and gas were essential

for their independence. “We used oil for our major goal,” said Ilham Aliyev, who would become the president of Azerbaijan, and that...

There was an additional reason for the Western interest. The Gulf War in 1991 had liberated Kuwait and yet had also engendered a new sense of insecurity about the heavy reliance on the Middle East. “The Caspian region will hopefully save us from total dependence on Middle East oil,” said then–U.S. energy secretary Bill Richardson. Washington did not want to see oil development in the region stymied by Russian opposition and competition—or reassertion of control.

One begins in Azerbaijan, just south of Baku, heads west for more than a thousand miles, crosses fifteen hundred rivers, high mountains, and sensitive terrains, and goes south across Turkey to the port of Ceyhan on the Mediterranean. The Caspian Pipeline, which takes Kazakh oil to world markets, goes from Kazakhstan through southern Russia to the Black Sea. From there tankers pick up the oil and carry it through the Bosporus and into the Mediterranean and onto world markets. That pipeline is Kazakhstan’s essential connection to the world.

By the first decade of the twenty-first century, both pipelines were operational, connecting Azerbaijan and Kazakhstan to global markets. Azerbaijan’s output has tripled since the breakup of the Soviet Union and is now around 800,000 barrels per day. But the real oil powerhouse is Kazakhstan,

whose output has grown from 570,000 barrels per day to 2 million. Those countries together are now producing more oil than the combined Norwegian and British output from the North Sea. The buildup of production from the long-delayed huge Kashagan field and expansion of Tengiz in Kazakhstan will further pu...

But pipelines would eventually also run in the other direction, not only from east to west, but also west to east—tha...

Buoyed by oil revenues, Kazakhstan’s economy had by 2019 grown almost eightfold since 2000. Nazarbayev has been an adroit balancer among the great powers—Russia and China and the United States. He also sought balance at home. A majority of the country is ethnic Kazakh, but 25 percent are ethnically Russian and Ukrainian, largely in the north of the country; and he worked to maintain the domestic balance, including establishing in the middle of the country the new capital city.

The connections between China and Kazakhstan are very important to both. Kazakhstan is rich in the natural resources that China needs. Far larger in territory than all the other Central Asian countries combined and with a long border with China, it is a major trade corridor for China. For Kazakhstan, the China market and Chinese investment will do much to determine its future prosperity.

Yet the rapid growth of the Chinese presence—and dependence on China—also causes anxiety in the Central Asian countries. At the popular level, there is suspicion and resentment of Chinese influence and such matters as Chinese acquiring farmland. At the government level, officials worry about how to balance between Moscow and Beijing. Russia’s continuing engagement helps prevent these countries from becoming too tightly embraced by China.

The Chinese are careful to convey that they are not aiming to supplant Russia’s “privileged” position in the region. Still, Moscow, even while deepening its own ties with China, eyes the Chinese expansion with some wariness. Whatever the rhetoric, Chinese investment in energy and infrastructure in the region does weaken the underpinnings of Russia’s privileged sphere and supplants Russian influence. But for now, Russia sees itself as the prime beneficiary of investment from and trade with China—and, beyond economics, from the strategic relationship, which has become a major fact of international life.

the respective commercial interests between the two countries are disproportionate. For Russia, China’s market is crucial. China now accounts for 11 percent of Russia’s total exports, and in terms of energy it will only grow. For China, Russia is an important and reliable supplier of energy imports, but accounts for only 2 percent of China’s total exports. Russia is also a key part of Beijing’s strategy of energy diversification. Russian oil and gas lessen dependence on the Middle East and on waterborne transport, which the Chinese worry could be interdicted by the U.S. Navy.

Yet, economically, the United States is much more important to China than is Russia. In 2018, before trade wars and the coronavirus, China exported $35 billion worth of goods to Russia, compared to $410 billion to the United States.

The pivot was very much in evidence on December 2, 2019. Five and a half years after the signing of the mega natural gas deal in Shanghai, the massive 1,865-mile Power of Siberia natural gas pipeline was ready to begin flowing gas. Vladimir Putin, in Sochi, and Xi Jinping, in Beijing, were joined by a complicated video hookup to control rooms on each side of the Russian-Chinese border to mark the inauguration of the pipeline. From their respective control rooms, Alexey Miller, CEO of Gazprom, and Wang Yilin, chairman of China National Petroleum Company, asked their presidents for approval, which each expeditiously gave. With that, the technicians opened the valves just in time to begin to supply China for the winter. “This is a genuinely historical event,” said Putin as the gas began to flow, “not only for the global energy market, but above all for us, Russia and China.”

But there was still a burning question about Russia’s future. Who would succeed Putin when his presidential term ended in 2024? In the spring of 2020 the answer became clear. Putin would succeed Putin. A new constitutional revision would allow him to serve as president until 2036—more or less for life. That way, he explained to the Russian parliament, he could

continue to be “the guarantor of the country’s security, domestic stability, and evolutionary development”—essential, he went on, because domestic and foreign enemies were “waiting for us to make a mistake or slip up.” This would also enable him to continue to guide Russia’s energy development and fortify the “turn” to the East. And that last would mean, more than anything else, further strengtheni...

The opening of the valve on the Power of Siberia pipeline demonstrated the fundamental role of energy in the strategic partnership between Russia and China. It is not all there is to the partnership, of course. Moscow and Beijing are conjoined by their emphasis on “absolute sovereignty,” their rejection of the “universal” values and norms propounded by the West, their reliance on state-dominated economies, and their opposition to what they call the would-be “hegemonic” position and “unilateralism” of the United States.

But energy

is a very important part of this new geopolitical nexus. A relationship that was once based on Marx and Lenin...

constrained; recriminations mounted, and hostility reached a new level.3 Does all this mean that China and the United States are headed for what Harvard professor Graham Allison called the “Thucydides Trap”? Named for the ancient Athenian military historian, the concept depicts the risk of war arising from the collision between a “dominant” power and a “rising” power. The many examples begin with the war in the fifth century BC between “dominant” Athens and “rising” Sparta, which Thucydides chronicled. It went on for thirty years and left both city-states devastated.

The other case studies include the naval race and economic competition between Britain and Germany that culminated in the First World War. At the end, both victors and vanquished were much worse off, and the carnage

laid the ground for the Second World War. None of these historic cases, of course, involved large arsenals of nuclear ...