Ingolf Kiesow, Ambassador and Senior Research Fellow, Research Director, Institute for Security and Development Policy, Central Asia-Caucasus Institute and Silk Road Studies Program, Stockholm, Sweden

Dear Ladies and Gentlemen, we have listened to the interventions today and also yesterday. I think when there is one prospective, it’s the whole prospective that I should like to remind about which is not being entirely overlooked but partially so. We have a European Caspian Black Sea regional conference, and it is easy to forget about the outside world. I would like to talk about the global value of the ECT.

After all, the main subject this morning is the Common energy policy and the Energy Charter. We have basic principles of the Energy Charter which I would like to remind about: to strengthen the rule of law on energy issues, mitigating risks associated with energy related investment and trade. We all have heard these principles and we love them. But they are not always applicable and that is the problem, especially in one context - it is big production and expensive oil, resource nationalism and field hunting.

The big production fears recess, since we have already approached state, where fields we have been utilizing by the international oil companies on which Europe, America and Japan depend for its supply of energy. These fields are being depleted, and we will never see again the same high level of production globally as we see today according to the theory. I am not saying that we have reached that stage but I think we have to believe that international oil companies, our traditional oil companies actually have depleted fields to the extent that production cannot go on the same level as before, if no new fields are found. And here we have the problem of resource nationalism. We have the new desperate countries, China and India, creating national oil companies being backed by the governments in the field hunting, in the mining up of new oil and gas fields. Pushing out the traditional oil companies from the market, actually, they are not able to compete with the same whole set of favorable conditions when they are trying to make their contracts. This state of competition if it is left without countermeasures is going to lead to a state where we also see Europe, America and Japan. National oil companies, something equivalent, are being created in order to cope with this situation. And then we will have a state competition about oil and gas. I mean, we have been talking about the danger of using oil as a weapon, but we also have to consider the problem of using weapons for getting oil and gas. I think that in order to reach on a global scale a wider reach, a real global reach of the basic principles of the Energy Charter, there will have to be made some compromises for the new desperate countries like India and China giving them some more room in the field hunting in some way. And there will have to be negotiations but we have not even talked about the negotiating on the international level on this problem. And I think, it is high time to do that exactly. The principles of the energy charter are good. We like them. But they have not been drafted for independent and private companies on an open and free market, and not for the national oil companies. Thank you for your attention.

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