Pipeline Power

Franz Hubert and Onur Cobanli

No 93, FIW Working Paper series from FIW

Abstract: We use cooperative game theory to analyze the strategic impact of three controversial pipeline projects. Two of them, Nord Stream and South Stream, allow Russian gas to bypass transit countries, Ukraine and Belarus. Nord Stream’s strategic value turns out to be huge, justifying the high investment cost for Germany and Russia. The additional leverage obtained through South Stream, in contrast, appears small. The third project, Nabucco, aims at diversifying Europe’s gas imports by accessing producers in Middle East and Central Asia. The project has a large potential to curtail Russia’s power, but the benefits accrue mainly to Turkey, while the gains for the EU are negligible.

Keywords: Bargaining Power; Transport Network; Natural Gas (search for similar items in EconPapers)
JEL-codes: L5 L9 O22 (search for similar items in EconPapers)
Pages: 27
Date: 2012-05
New Economics Papers: this item is included in nep-cwa, nep-ene, nep-eur, nep-gth, nep-ppm, nep-tra and nep-tre
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Citations: View citations in EconPapers (8)

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Related works:
Working Paper: Pipeline Power (2012)
Working Paper: Pipeline Power (2012)
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