Russian energy minister cancels Houston visit amid Ukrainian crisis

HOUSTON — Russian Energy Minister Alexander Novak has canceled plans to speak at the IHS CERAWeek energy conference in Houston on Tuesday, as tensions in the Ukraine heat up.

Novak, who was born in the Ukraine, was to speak at the Houston-based energy conference on Tuesday. Conference organizers have added a session with Russian experts discussing the Ukrainian crisis and its implications for the international energy sector.

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Russian forces seized control of the Crimean portion of the Ukraine on Saturday, as a new pro-Western Ukrainian government has roiled tensions between the two neighbors.

The invasion indicates Russia’s intention to force Ukraine’s new government to either accept partitions of areas with high concentrations of ethnic Russians or make other major concessions to their Eastern neighbor.

The unrest could have implications for Russia’s oil and gas sector and its role as a key energy provider to Europe.

“Russia and the European Union are co-dependent,” said Andy Lipow, president of Lipow Oil Associates, noting that the European Union imports about 30 percent of its natural gas supplies from Russia, as well as about 30 percent of its oil.

Russia, in turn, receives more than half of its budgetary funds from the revenue generated by these natural gas and oil sales to Europe, which accounts for about three-fourths of its hydrocarbon sales.

The developments could have implications for the role of exports of U.S. natural gas and the current ban on exporting crude oil, as well.

“Because the European Union is so dependent on Russia for its energy supplies, it will add to the debate of whether the U.S. should increase its exports to the European Union to provide an alternative to Russian supplies,” Lipow said.

The regional dispute is expected to be one of the major themes of the conference, including Russia’s future role in providing natural gas to Europe. Secretary of State John Kerry has indicated there could be economic sanctions against Russia in response to the invasion.

Russia’a state-owned Gazprom, which supplies natural gas to Europe through Ukraine, was down more than 13 percent in early trading on Monday.

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