Top EU Diplomat Says Europe’s Prosperity Based on Cheap Gas From Russia

Warns of 'perfect storm' leading to 'world recession'

High Representative of the European Union for Foreign Affairs and Security Policy Josep Borrell attends a news conference, as Russia's invasion of Ukraine continues, in Kyiv, Ukraine, April 8, 2022. (Janis Laizans/Reuters)

A top diplomat said in the European Union Ambassadors’ Annual Conference that the continent has been “decoupled” due to multiple “black swan” events from its sources of prosperity and security, referring to global partners such as Russia, China, and the United States.

“Our prosperity has been based on cheap energy coming from Russia. Russian gas—cheap and supposedly affordable, secure, and stable. It has been proved not [to be] the case,” said Josep Borrell, the high representative of the European Union for Foreign and Security Policy, on Oct. 10. He also noted the significant relationship with China, “for technological transfers, for investments, for having cheap goods.”

Borrell said that China and Russia could no longer be depended upon as before, and that “the best energy is the one that you produce at home,” which means “a strong restructuring” of the European economy.

Regarding the United States, he said that the country was the source of security for Europe. Even if the United States and Europe were in a “fantastic relationship and cooperating a lot,” the current political situation may change. “What would have happened if instead of [Joe] Biden, it would have been [Donald] Trump, or someone like him in the White House?”

Ironically, it was Trump who warned that Europe, and specifically Germany, was becoming “totally dependent on Russian energy,” during a United Nations General Assembly speech in Sept. 2018, while at the same failing to fulfill NATO obligations.

Borrell pointed out that Europe needs to “shoulder more responsibilities” and play a bigger part in safeguarding their economic and political future.

“You—the United States—take care of our security. You—China and Russia—provided the basis of our prosperity. This is a world that is no longer there.”

Replacing Russian Energy

Borrell talked about replacing Russian gas imports with those from other countries, but he talked about French President Emmanuel Macron’s warning that it would be substituting “one dependency by another.”

“We are happy that we are importing a lot of liquefied natural gas [LNG] from the United States—at a high price, by the way—and substituting Russian gas by American and Norwegian gas, or Azerbaijani gas,” but Borrell repeated the concern regarding the change of guard in American politics.

“You can imagine the situation in which our critical dependency from LNG coming from the United States could also be in crisis.”

Borrell talked about the Ukraine war, which the Americans had warned about and the Europeans “were quite reluctant to believe.”

“And I remember very well when [U.S. Secretary of State] Tony Blinken phoned me and told me, ‘Well, it is going to happen this weekend.’ And certainly, two days later, at five o’clock in the morning, [Russia] started bombing Kyiv.”

Global Recession

The war in Ukraine, aggressive U.S.–China competition, and the food and energy crises happening around the world have created a “perfect storm,” with price inflation and resulting interest rate hikes leading to “a world recession.”

The world economies follow the U.S. Federal Reserve, “otherwise their currency will be [devalued].” Borrell said that before the euro, the region would “follow the monetary policy dictated by Germany.”

Borrell’s warning regarding international dependencies come as the World Bank and the International Monetary Fund are kicking off their first in-person meetings since the pandemic. The executives of both organizations called for coordinated action as the world faces an “era of volatility.”

“There’s a risk and real danger of a world recession next year,” World Bank President David Malpass said as he began the discussion.