Austrian neutrality and Russian gas imports
It turns out that the international markets for liquified natural gas are complicated
Fabian Scheidler provides a helpful summary of the history of Austrian neutrality, which dates back to the State Treaty of 1955 that restored Austrian sovereignty and formally ended the post-World War II four-power occupation by the US, the USSR, Britain, and France.
The widely celebrated embrace of neutrality became a pillar of Austria’s identity and remains associated with one figure: Bruno Kreisky who served as undersecretary of state (1953-59), foreign minister (1959-66) and chancellor (1970-83). A Social Democrat, Kreisky forged a technique later called ‘active’ or ‘engaged’ neutrality, visiting Bulgaria, Romania and Hungary in the 1960s ‒ a first for a Western foreign minister. In so doing, he paved the way for Germany’s policy of détente, soon implemented by that country’s chancellor Willy Brandt (1969-74), a close friend of Kreisky’s from their shared exile in Sweden during the second world war.
Kreisky was also instrumental in arranging the Conference on Security and Co-operation in Europe (CSCE), held between July 1973 and August 1975 in Helsinki and Geneva, as well as in writing the Helsinki Declaration (signed 1 August 1975); the conference and declaration both shaped the détente’s institutional framework. When the CSCE became the Organisation for Security and Co-operation in Europe (OSCE) in 1995, it set up shop in Vienna, already home to numerous United Nations agencies that Kreisky had helped bring to Austria. Being a diplomatic hub offers Austria not only international kudos but also a sort of ‘negative security assurance’ (a commitment by nuclear-armed states not to carry out a strike on a non-nuclear state).1 [my emphasis]
In other words, Austria’s status as a neutral nation served it well during the Cold War and to some extent continues to do so. Vienna in particular remains an important business and financial center with ties to former Soviet-bloc countries. Vienna still hosts the UNO City (Vienna International Centre) that hosts various United Nations offices.
But neutrality isn’t a static or unform situation. As a member state of the European Union, Austria is bound by the mutual-defense obligation in the 2009 Treaty of Lisbon. 2
Austria also remains a notable consumer of Russian gas.3 A major portion of it comes from oil pipelines that still pump oil through Ukraine. Even during the war, Ukraine has continued to receive some transit revenue from Russia. Well-established international oil-shipping arrangements can be complicated to undo.
And while oil may not be entirely fungible, it’s not possible with the current sanctions to completely shut Russia off from international markets. As Marine Delcheva reports for Profil:
The partially-state-owned [Austrian company] OMV, which has an energy supply contract until 2040 with Russia's state-owned Gazprom, recently signed a contract for a 10-year supply of liquefied natural gas [LNG] with BP. But where BP gets its liquefied gas from is also unknown.
Presumably BP itself know where it gets it LNG supplies …
Austria is getting some criticism within the EU for such imports. But it is not alone:
Since the beginning of the war and the EU-wide pullback from Russian pipeline gas, Russia has sought new routes for its exports to Europe - with considerable success. Because what no longer flows directly through the pipelines into EU countries now comes via the alternative route of liquid-natural-gas tankers and new delivery partners. According to an estimate by the British environmental and human-rights NGO Global Witness, … the EU countries in the first half of 2023 imported from Russia around 40% more LNG, with a value of $5.29 billion euros, compared to 2021, i.e., before the war began.4
Delcheva also notes that in July, the EU concluded an agreement with Azerbaijan for significant supplies of LNG - 20 billion cubic meters by 2027 - and in November Azerbaijan also concluded a new agreement to received gas supplies from the Russian Gazprom company. (Azerbaijan also has a questionable human rights record with its Albanian minority, much of which is now in flight from the country.5)
Economic sanctions are complicated. Because businesses like the global LNG market are also complicated.
Scheidler, Fabian (2023): Austria: neutral for how much longer? Le Monde diplomatique English Sept 2023. <https://mondediplo.com/2023/09/07austrian> (Accessed: 2023-01-10).
Tidey, Alice (2023): Like NATO, the EU has a mutual defence clause but trust appears low. Euronews 07.06.2022. <https://www.euronews.com/my-europe/2022/06/07/like-nato-the-eu-has-a-mutual-defence-clause-but-trust-appears-low> (Accessed: 2023-06-09).
Delcheva, Marina (2023): Unser täglich Gas. Profil 01.10.2023, 44-45. My translation from German.
op. cit.
Nagorno-Karabakh: Armenia and Azerbaijan officials give their verdict. Euronews 09/20/2023. <https://www.euronews.com/2023/09/20/nagorno-karabakh-violence-armenia-and-azerbaijan-respond-to-ceasefire> (Accessed: 2023-10-09).