What’s a declining empire to do when its influence over its neighbors have waned and those neighbors have elected western leaning leaders, contrary to your desires. Well if that nation is Russia and you possess vast stockpiles of oil and natural gas reserves you use that resource as a political weapon to re-exert influence.

As of today, Russia has cut off gas imports to the Ukraine, after Ukraine balked at a significant price increase imposed by Gazprom, the state run Russian gas giant. Gazprom has demanded the Ukraine pay $230 per 1,000 cubic meters of gas, more than quadrupling the current price that country pays for its energy resources. Russia argues that it can no longer continue to offer below market rates to former Soviet states. In reality, Russia continues to offer more favorable rates to states, which tow the line, like Belarus. Ukraine, however, had the audacity to elect a president who was not personally chosen by the authoritarian Russia President, Vladimir Putin.

Ukrainian President Yushchenko has called on Russia to implement a phased price increase, but Russia has nixed any such suggestion. Yushchenko, has called such a position politically motivated and this is a correct assessment. Fortunately, Ukraine is only dependent upon Russia for 30% of its oil needs. Like the US and every other country dependent upon petroleum, the Ukraine, should recognize the impending need for progress and innovation in the energy sector. Most of the world’s oil reserves rest in the hands of tyrants: like the mullahs in Iran, Hugo Chavez, Vladimir Putin and so on. Such individuals simply can’t be trusted as the fuel for the engine of world economic growth.
http://www.cnn.com/2005/WORLD/europe/12/31/russia.ukraine.offer.ap/index.html