Friday, January 9, 2009

Hungary Offers a Cannister of Gas to Freezing Serbia

Hungary has decided to send a little gas Serbia's way. While this is certainly a good thing, it can be seen as a reluctant step to help out a freezing neighbor. The question is should Hungary send more to a neighbor that has no reserves and is freezing its butt off now. That is since heating has been turned of for some residential customers? Also, how does contribute to CEE/SEE regional cooperation Hungary has called for?

The amount of gas that Hungary is sending to Serbia between 1 to 2 million cubic meters is just about the same amount that is being sent from Austria to Hungary (1.5 million cubic meters as of Weds. MTI-subscription only). While it is stated that amount being sent is also equal to the amount that Hungarians conserves (spongy estimates in a cold snap). So in reality the reluctance of the Hungarians to send gas and to make it seem that they are giving charity to Serbia is lame since they are only 'taking' Austrian reserves and sending those through to Serbia.

In crisis situations there should be a willingness to help out ones neighbor. And even then, there should be an attempt to make some sacrifice to ensure your neighbor is not freezing to death. For Hungary to offer the bare minimum, which only is equal to the amount not consumed in Hungary - and related to what is being sent from Austria, is similar to sending half a life jacket to your drowning friend while you sit in the boat.

The final point here is also, the idea of regional cooperation. The NETS project organized by MOL is being established which in a situation like this could help out by operating a regional gas reserve. There will no doubt still be national gas reserves, but under infrastructure improvements and greater coordination, reserve requirements and places for storage can be spread throughout the region. Moving gas between countries when external supplies are cut off is a key element for increasing the security of supply in the CEE and SEE region. NETS is being built with this partially in mind. But success can only come if mutual trust and a willingness to help out exist - Hungarian actions do not qualify.