Insights into Turkish Domestic and International Politics during Aug. 16th - Sept. 15th 2014
By John VanPool, EGF Turkey and Black Sea Regional Analyst

Key Points:

• New Prime Minister Ahmet Davuglotu announces his cabinet with few surprises, save the re-appointment of economic policy heads Ali Babacan and Mehmet Simsek. The cabinet will continue to carry out its predecessor’s policies, though Turkey’s de facto leader remains President Recep Tayyip Erdogan.
• Turkey declines to actively support American-led airstrikes against the Islamic State (IS) in Iraq and Syria. Its reluctance, despite the continued imprisonment of 49 hostages by IS, has drawn the ire of critics in the West, who accuse it of failing to confront the jihadist fighters.
• Syria’s refugees in Turkey look to swell to 1.5 million by the end of 2014. Their presence outside of the few refugee camps is giving rise to resentment amongst Turkey’s citizens.
• The Babacan and Simsek appointments to the prime minister’s cabinet have soothed market concerns about the stewardship of the country’s economy, though slower growth in the coming years looks to be the next great challenge for the ruling AKP.
• Turkish national oil company TPAO secures a 19 percent stake in the Shah Deniz-2 gas field, while Kurdish oil continues to flow to the Turkish port of Ceyhan despite the protestations of the Iraqi central government in Baghdad.

• EGF Editorial  |  Published on EGF: 24.09.2014  |  External Relations
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A Snapshot of Key Developments in the External Relations of the Russian Gas Sector
By Jack Sharples, EGF Associate Researcher on the external dimensions of Russian gas

Key points:

• EU antitrust investigation into Gazprom – victim of the deterioration in EU-Russia relations?
• Nord Stream - Russian sources report imminent ruling from European Commission on OPAL pipeline
• South Stream - Bulgaria halts work on South Stream for a second time. Or does it?; Srbijagas announces that work is proceeding as scheduled, despite last month’s warning from the EU that the project should be halted
• Gazprom and Ukraine - Ukrainian Energy Ministry proposes ‘interim’ agreement with Gazprom, pending results of arbitration; Naftogaz opens pipeline from Slovakia; Ukrainian parliament votes to allow leasing of gas transmission system; Naftogaz returns $10m of ‘unused’ transit fees to Gazprom
• Asia-Pacific region - Gazprom launches construction of ‘Power of Siberia’ gas pipeline to China
• Gazprom takes delivery of its fifth LNG tanker, brings fleet capacity to 800,000 m3; Gazprom gas production in 2014 expected to fall vs. 2013

• EGF Editorial  |  Published on EGF: 11.09.2014  |  External Relations
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Insights into Turkish Domestic and International Politics during July 16th-Aug 15th-2014
By John VanPool, EGF Turkey and Black Sea Regional Analyst

Key Points:

• Prime Minister Tayip Erdogan becomes the first popularly elected president of the Turkish Republic, capturing 51.7 percent of the vote and avoiding a run off.
• Since the Presidency is still a largely ceremonial post, expect President-elect Erdogan to push hard for the 2015 parliamentary elections where an AKP majority win could pave the way for a constitutional change that empowers the executive branch.
• Turkey tries to help the Kurdish Regional Government (KRG) of Iraq hold the line, while negotiations continue for Turkish hostages held by the Islamic State (IS).
• Following the latest Hamas-Israeli clash in the Gaza Strip, Turkey foreswears all cooperation with the Jewish state until the combat stops.
• Turkey continues to balance economic ties between Erbil and Baghdad over oil shipments from the KRG, while the South Stream gas pipeline passes an environmental impact study off the Turkish Black Sea coast.

• EGF Editorial  |  Published on EGF: 27.08.2014  |  External Relations
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A Snapshot of Key Developments in the External Relations of the Russian Gas Sector
By Jack Sharples, EGF Associate Researcher on the external dimensions of Russian gas

Key points:

• Gazprom and the EU – EU antitrust investigators continue to prepare ‘statement of objections’; Gazprom excluded from expanded EU sanctions list
• Nord Stream – Planned capacity auction for OPAL cancelled, as European Commission postpones ruling indefinitely
• South Stream - Gazprom subsidiary Centrgaz is awarded the construction contract for South Stream in Serbia; Bulgarian government willing to listen to the European Commission over South Stream; European Commission recommends that Serbia halt work on South Stream pending legal clarifications
• Gazprom and Ukraine - Naftogaz and Ukrainian government announce plan to avoid Russian gas imports until March 2015; Ukrainian government and Naftogaz disagree over reports of reduced gas deliveries from Europe to Ukraine; Gazprom and Naftogaz arbitration cases could be combined
• Asia-Pacific region - Gazprom continues design process for proposed Vladivostok LNG terminal
• Elena Burmistrova replaces Alexander Medvedev as Director-General of Gazprom Export

• EGF Editorial  |  Published on EGF: 12.08.2014  |  External Relations
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Insights into Turkish Domestic and International Politics between 16 May – 16 July 2014
By John VanPool, EGF Turkey and Black Sea Regional Analyst

Key Points:

• Iraq implodes as the Islamic State (IS, formerly known as the Islamic State of Iraq and the Levant or alternatively the Islamic State of Iraq and Syria) allies with Iraqi Sunnis to overtake large swaths of the country’s northwest, including the city of Mosul. Turkish hostages are taken in the city, and the Kurdish Regional Government of Iraq halts IS’s march towards oil-rich Kirkuk.
• Turkey balks at an independent Kurdistan, but in the long run, a stable and secular Kurdish state might become a better alternative to IS on its borders.
• The CHP and MHP nominate religiously conservative Ekmeleddin Ihsanoglu as their presidential candidate, while the Kurdish HDP’s Selahattin Demirtas may play kingmaker if Prime Minister Erdogan enters a runoff in the August election.
• Parliament passes groundbreaking law moving the PKK peace talks forward, just in time for the presidential election.
• The Central Bank continues to resist demands by the prime minister to sharply cut interest rates.

• EGF Editorial  |  Published on EGF: 23.07.2014  |  External Relations
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A Snapshot of Key Developments in the External Relations of the Russian Gas Sector
By Jack Sharples, EGF Associate Researcher on the external dimensions of Russian gas

Key points:

• Lithuania’s competition authority fines Gazprom $48m for ‘failing to comply with merger conditions’ in relation to its shareholding in Lietuvos Dujos, thus stifling competition in Lithuania’s gas market
• Gazprom sells its stakes in Lietuvos Dujos and Amber Grid
• European gas companies negotiated an average discount of 20 percent in 2013-14, according to Cedigaz
• Gazprom implements prepayment in Ukraine, meaning that Naftogaz will only receive gas for which it has already paid. Given that Naftogaz failed to pay up front for its June gas supplies, the practical result was the suspension of Gazprom deliveries to Naftogaz
• Bulgaria halts construction of South Stream, pending EU concerns over the tender process for its construction on Bulgarian territory
• Gazprom and OMV confirm Austria’s entry into the South Stream project
• Gazprom expects $25bn pre-payment in China gas deal, but terms yet to be finalised
• Rosneft claims that a Gazprom monopoly on domestic pipelines in the Russian Far East would be illegal, and promises legal action to secure its right to supply Russian consumers in the region
• Results of Gazprom's Annual General Meeting of Shareholders

• EGF Editorial  |  Published on EGF: 15.07.2014  |  External Relations
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The second stakeholder consultation round in EGF's ongoing Nagorno-Karabakh research took place on 06-08 July 2014 in Berlin (Germany), including introduction of a post-conflict scenario building workshop. More than 30 experts from Armenia, Azerbaijan, and international partner NGOs and institutions attended this highly successful event, held in a constructive atmosphere of exchange. It has been the first step towards exploring the idea of a roadmap leading towards an economically integrated South Caucasus, and created a platform for exchange of information between Armenian and Azerbaijani experts. During the post-conflict scenario building workshop, regional participants simulated the negotiation of a roadmap for the implementation of economic components of a peace agreement built upon the Madrid principles, encompassing joint economic measures in areas such as energy, transport, trade, rehabilitation of the territories affected by the conflict, and the return of IDPs to their homeland. Click here to see the agenda of the seminar, and participants’ biographies. Click here to see the EGF presentation on this research. A summary of conclusions, as well as other related information will be published soon.

• EGF Editorial  |  Published on EGF: 11.07.2014  |  Markets
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The second stakeholder consultation round in EGF's ongoing Nagorno-Karabakh research took place on 06-08 July 2014 in Berlin (Germany), including introduction of a post-conflict scenario building workshop. More than 30 experts from Armenia, Azerbaijan, and international partner NGOs and institutions attended this highly successful event, held in a constructive atmosphere of exchange. It has been the first step towards exploring the idea of a roadmap leading towards an economically integrated South Caucasus, and created a platform for exchange of information between Armenian and Azerbaijani experts. During the post-conflict scenario building workshop, regional participants simulated the negotiation of a roadmap for the implementation of economic components of a peace agreement built upon the Madrid principles, encompassing joint economic measures in areas such as energy, transport, trade, rehabilitation of the territories affected by the conflict, and the return of IDPs to their homeland.

Please click here for the summary of conclusions.
Please click here to see the agenda of the seminar, and participants’ biographies.
Please click here to see the EGF presentation on this research.

• EGF Editorial  |  Published on EGF: 11.07.2014  |  Markets
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A Snapshot of Key Developments in the External Relations of the Russian Gas Sector
By Jack Sharples, EGF Associate Researcher on the external dimensions of Russian gas and Lecturer in Energy Politics at the European University of St Petersburg

Key points:

• Special report on the Gazprom-CNPC gas deal: Gazprom was always unlikely to achieve ‘European’ prices for its gas exports to China, but the deal with CNPC is crucial to the development of gas production and transportation in East Siberia and Russia’s Far East
• In-depth report on the latest developments in the Gazprom-Naftogaz dispute: Gazprom switches to pre-payment, and demands that Naftogaz pay up front for its June gas supplies. If Naftogaz fails to pay by the 2nd of June, Gazprom’s supplies to Naftogaz to could be halted the following day
• EU antitrust damages directive approved by European Parliament, and passed to EU Council of Ministers for final approval
• Gazprom and Lietuvos Dujos reach agreement on gas price for Lithuania, as Lithuania continues to negotiate for alternative supplies
• Eni signs landmark agreement with Gazprom to switch to spot pricing in existing long-term gas supply contract
• South Stream could get a 32 bcm spur from Hungary to Austria
• Gazprom Marketing and Trading Ltd and CNPC each agree to buy 3 million tonnes of LNG per year for the next 20 years from Novatek’s Yamal LNG project

• EGF Editorial  |  Published on EGF: 03.06.2014  |  External Relations
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Insights into Turkish Domestic and International Politics between 16 April – 15 May 2014
By John VanPool, EGF Turkey and Black Sea Regional Analyst

Key Points:

• Turkey faces up to the worst mining disaster in its history, while the prime minister bungles the official response. A deputy chief of staff for Erdogan is photographed kicking a protester, and accusations are levelled that the prime minister himself struck another.
• Turkey’s top judge, with the prime minister in attendance, rebukes Erdogan in public statements in light of government criticism of the country’s top courts.
• While Turkey’s economic growth relies on substantial imports of Russian energy, the fate of the Crimean Tatars seems to remain outside the Turkish regional agenda.
• Alawites and Alevis, two religious minorities who largely support the opposition CHP, face an increasingly uncertain political future.
• In remarks to an American journalist, Prime Minister Erdogan says the country will pursue extradition of Fethullah Gulen from the U.S.

• EGF Editorial  |  Published on EGF: 22.05.2014  |  External Relations
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