Russia bullies BP – U.S. motorist, take note

How the aggressive behavior of the world’s second largest exporter could drive prices higher for everyone.

NEW YORK (CNNMoney.com) — Russia is again flexing its energy muscle.

On Friday, reports said Russia may cancel a contract it has with BP to develop a huge natural gas field in the middle of the country, claiming BP wasn’t producing enough gas at the project.

This would be the latest in a string of incidents generally interpreted as Russia strong-arming its partners into deals more favorable to the government. These moves, analysts say, could hurt worldwide production and drive up energy costs for consumers everywhere.


Earlier this winter, the Kremlin shut off gas supplies to Europe after a dispute with Belarus, through which the pipeline passes.

That dustup echoed a similar spat with Ukraine the previous winter.

As evidenced by Friday’s BP news, private oil companies have also felt the Kremlin’s wrath.

CNNMoney.com