Because natural gas is more environmentally friendly than oil or coal (it releases half as much carbon dioxide as coal for equal energy output, and a third less than petroleum), it is attractive to countries seeking to reduce their greenhouse gas emissions in accordance with the Kyoto treaty. In Europe gas's share of all fuels used in generating electricity is projected to rise from 18 percent in 2002 to 29 percent in 2030. A similar trend can be expected in the United States, if Congress or some future administration moves to reduce the nation's emissions of CO2.

Developing nations like China, India and South Korea, increasingly aware of the environmental consequences of their excessive reliance on oil and coal, are also turning to natural gas. According to the Energy Department, gas consumption in China will grow by an estimated 7 percent per year between 2001 and 2025, five times the rate for the United States and the largest for any major industrial power; India and South Korea are also among the fastest-growing gas consumers. These projections help explain the aggressive steps being taken by these countries to secure additional supplies of gas.

The rising worldwide demand for gas is also influencing relations between the major consuming nations and their principal suppliers. A key factor in the geopolitics of natural gas is the heavy concentration of reserves in a relatively small number of producing countries. All told, the top ten gas producers harbor 76 percent of the world's proven reserves, while the top five--Russia, Iran, Qatar, Saudi Arabia and the United Arab Emirates--hold nearly 67 percent. This means, of course, that these countries are in a very strong position to control the global flow of gas and to influence market forces.

Russia, which owns 26.7 percent of the world's proven gas supplies (compared with 2.9 percent for the United States), will play a dominant role in the energy field for many decades to come. Although the United States and Russia produced similar amounts of gas in 2004-05 (543 billion and 589 billion cubic meters, respectively), America's output was about 10 percent of its total reserves while Russia's output was only 1 percent.

Russia already supplies a large share of Europe's natural gas, and when new pipelines are constructed, it will be capable of supplying vast amounts to China, Korea and Japan--even the United States, eventually. Until now, the Russians have been very careful to avoid giving the impression that they intend to exploit their dominant position in Europe for political advantage. Nevertheless, Moscow has been accused of engaging in such practices in the past: In December 2000, for example, it temporarily suspended gas deliveries to Georgia in a move perceived by many Georgians as punishment for the failure of its leaders, notably then-President Eduard Shevardnadze, to defer to Russia on key regional issues. The current blockage of gas to Ukraine can be seen as another instance of the same tactic.

Officials of the European Union are worried about the growing role of Gazprom in the delivery of natural gas to Europe. At present, Gazprom supplies approximately 40 percent of Europe's natural gas, and its share is likely to grow as gas fields in the North Sea are exhausted. Fearing that Moscow may someday exploit its role as Europe's major gas supplier to wring political concessions from its customers, EU officials have called for greater diversity in the procurement of energy--so far, to little avail.

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