VZCZCXYZ0020
RR RUEHWEB

DE RUEHRL #0045 0091655
ZNR UUUUU ZZH
R 091655Z JAN 07
FM AMEMBASSY BERLIN
TO RUEHC/SECSTATE WASHDC 6610
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUCNFRG/FRG COLLECTIVE
RUEHKV/AMEMBASSY KYIV 0003
RUEHSK/AMEMBASSY MINSK 0291
RUEHMO/AMEMBASSY MOSCOW 1686
RHMFIUU/DEPT OF ENERGY WASHINGTON DC
RUEATRS/DEPT OF TREASURY WASHDC
RHEHNSC/NSC WASHDC

UNCLAS BERLIN 000045 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
STATE FOR EUR/AGS TO'KEEFFE, EB/ESC/IEC FOR SGALLOGLY, 
JLEWANDOWSKI, RGARVERICK, EUR/ERA FOR LCATIPON, DLIPPEATT 
 
E.O. 12958: N/A 
TAGS: ENRG ECON PREL PGOV PL RS BO UP GM
SUBJECT: GERMANY TAKES RUSSIAN - BELARUS OIL DISPUTE IN 
STRIDE 
 
REF: WARSAW 33 
 
THIS CABLE IS SENSITIVE BUT UNCLASSIFIED, NOT FOR INTERNET 
DISTRIBUTION 
 
¶1.  (U) German reaction to the cutoff of Russian oil via the 
Druzhba Pipeline has been relatively muted.  Economics 
Minister Michael Glos stated there was no cause for alarm as 
Germany has sufficient reserves to cover any shortages.  That 
said, Glos demanded that "the pipeline be reopened as soon as 
possible."  Chancellor Merkel stated the cutoff underscores 
the need for Germany to diversify its energy supplies, focus 
on renewables, and reexamine its decision to phase out 
nuclear power.  Merkel intends to raise the issues of 
security of supply and transit with Russian President Putin 
in a previously scheduled meeting set for January 21 in 
Moscow, a point Chancellery Director General for Economics, 
Jens Weidmann, reiterated in a meeting with EMIN January 9. 
Merkel also publicly stated a new partnership agreement with 
Russia is vital and should address energy security concerns. 
 
¶2.  (SBU) Weidmann told us no oil is coming to Germany 
through the pipeline.  He added that there are alternative 
sources as well as 90 days of reserves which will keep the 
cutoff from having an immediate impact on domestic supplies. 
He does expect the disruption to impact discussions on 
security of energy supplies, in Germany as well as throughout 
the EU.  Germans in the past, he said, have tended to regard 
energy security as a problem for others;  Russia's actions 
showed Germany too is vulnerable. 
 
¶3.  (SBU) Ministry of Foreign Affairs State Minister Gernot 
Erler agreed with Weidmann's assessment.  He also told us he 
believes the disagreement will be resolved soon.  The Foreign 
Ministry's Energy Officer Michael Frank was sanguine about 
the technical impact of the shutoff.  He said Germany's 
reserves were more than sufficient to weather any disruption 
of supply, and stated that oil is much more fungible than 
natural gas.  Frank said the main impact is likely to be on 
the reputation of Russia as a reliable energy supplier. 
Hartmut Schneider, Deputy Director General for Energy at the 
Economics Ministry, echoed Frank's opinion.  Schneider added 
that the disruption will influence not only German-Russian 
but also EU-Russian relations.  Schneider said it was 
apparent by Russia's behavior that it had little concern for 
its European "friends."  Schneider stated European 
Commissioner Piebalgs would chair a meeting of the EU Oil 
Suppliers Group later in the week, possibly Thursday or 
Friday (January 11 or 12). 
 
¶4.  (U) The Druzhba Pipeline provides approximately 20% of 
Germany's crude oil imports (22 million tons) to refineries 
in eastern Germany at Schwedt and Leuna.  Both refineries 
have approximately one week of crude oil reserves.  Berlin is 
among the areas the two refineries supply with gasoline and 
other refined products.  The refinery at Schwedt is connected 
via tanker to a pipeline in Rostock and as a result should 
experience no disruption in operation.  The German government 
has strategic oil reserves to cover demand for 90 days, as 
well as the largest natural gas reserves in Europe.  German 
energy companies also maintain their own reserves. 
 
¶5.  (SBU) In contrast to last year's controversy over natural 
gas supplies via Ukraine, the German government has not 
rushed to the defense of Belarus a country viewed by most 
Germans as autocratic and less "European" than Ukraine. 
However, the controversy is likely to strengthen Germany's 
determination to diversify energy supplies, including through 
a proposed LNG terminal at Wilhelmshaven and the Baltic Sea 
Pipeline, currently under construction.  In addition, it will 
affect discussions on an EU energy strategy, to be released 
under the German presidency in March.  The European 
Commission is also scheduled to release an extensive series 
of energy initiatives on January 10. 
TIMKEN JR