Turkey’s seemingly interminable effort to join the European Union has hit a new snag.
Energy.
On 9 February European Union Commissioner for Enlargement and European Neighborhood Policy Stefan Fule and the EU’s Commissioner for Energy Gunther Oettinger met with Turkish Minister for EU Affairs and Chief Negotiator Egemen Bag?s and Turkish Energy Minister Taner Yildiz in the ancient Ottoman imperial capital Istanbul to discuss intensified EU-Turkish cooperation in the energy sector.
The upside?
Oettinger told reporters after his meetings, “We have talked about plans for increasing the inter-consecutiveness of Turkey with the countries in the region and Turkey’s neighbors to compensate the need in case of a problem in any other supplier,” a clear reference to the EU’s upcoming increased sanctions on Iran before noting that Turkey remains “a strong candidate” for the transfer of Caspian energy resources to Europe.
The downside?
Yildiz said after the meetings that Turkey has not yet started the official energy accession chapter with the EU within the scope of membership negotiations, noting, “Turkey has done its best and did not put forward the opening of the energy chapter as a condition while signing crucial energy agreements also effecting Europe. We have had more de-facto gains than we had in official talks. Now it is time to put them on paper.”
Earlier this month Oettinger said some EU members were not committed to the idea of “a true single market in energy,” which is due by 2014 but stalled and called for Brussels to “take stock” of what had not been achieved “because primary law was not sufficient.” Addressing a European Economic and Social Committee conference Oettinger said, “At the end of the day, what I am looking for is full competence. At the moment, it’s a matter for member states, but it should, I believe, fall into the hands of the Parliament and Council,”adding that he wished to open an energy chapter with Turkey in the current accession talks and to enlarge Europe’s energy community to take in Ukraine, Moldova, Georgia, Norway, Switzerland, Albania, Serbia, Montenegro and the Maghreb, commenting, “Energy does not stop at the borders of the EU.”
Which leaves Turkey exactly where?
Not an energy producer, Turkey still imports roughly 90 percent of its energy needs from neighbors, but the country is increasingly valuable to Europe as pipelines crisscross its territory, including the Baku-Tbilisi-Ceyhan oil pipeline, which delivers roughly a million barrels per day (bpd) of Azeri crude per day to Western markets.
Turkey also has sovereignty over the Black Sea-Mediterranean Bosporus and Dardandelles shipping channels, where busy tankers ferry roughly another 2.4 million bpd of Russian Kazakh and Azeri crude make their way to eager consumers.
So, while not an energy producer, Turkey is nevertheless a major facilitator for foreign consumers.
But the past decade has seen Turkish public opinion become more ambivalent about joining the EU at any cost, as the Turkish economy has seemingly gone from strength to strength. Ten years ago Ankara was hugely dependent on the EU, with 59 percent of all Turkish exports going there. Today the ratio is 46 percent, with regional exports taking up an increasingly important share.
The positive outcome of the Istanbul meetings? According to a subsequent statement released by the European Commission after the meetings in Istanbul, "Both sides have underlined the importance of opening the chapter of accession talks concerning energy" and it was also has also been agreed "that closer collaboration is mutually advantageous" in areas such as market integration (of electricity and natural gas), including the development of infrastructure and safe gas transport, the promotion of renewable energy and energy efficiency.
So, the question arises, in the decades-long convoluted accession tango between the EU and Turkey, what will happen and who needs the other more? A decade ago the answer seemed more straightforward, but with the Organization for Economic Cooperation and Development forecasting that Turkey will be the OECD’s fastest growing economy up to 2017, with a 6.7 percent average annual growth rate, Brussels, as it grapples with Greece’s incipient default, might take a new look at both Turkey’s importance to EU energy imports as well as its membership aspirations.
And, as for Turkey, its economic growth remains nobbled by the high cost of energy imports. According to Turkey’s Economy Ministry and TurkStat, Turkey's statistics authority of Turkey’s 2011 $240.8 billion in imports, energy cost $54.1 billion and for each $10 per barrel oil prices rise, Turkey shells out an additional $4 billion.
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It’s good to have friends.
Addressing Turkey’s concerns for the energy well-being of its friends Yildiz said of the Istanbul discussions, "Turkey did everything it had to do. The fact that (Azeri Caspian offshore natural gas) Shah Deniz 2 project was signed implies opening up a path to carry natural gas to EU member countries. Up until now, Turkey has assumed a positive mode and will continue its positive approach. We want our meeting to generate a solid result. Turkey, by utilizing its advantages stemming from its geography, continues its works in practice related to the supply of natural gas and electricity to the EU members” before concluding that “energy is a human right. We do not foresee the opening up of the energy chapter to negotiations as a precondition as we meet EU's energy needs.”
Time for some reciprocity.
By. John C.K. Daly of Oilprice.com
