1. Energy security and Foreign Policy. Europe between WWII and the Beginning of the New Century Florence, 19 th March 2013 Matteo Verda Università degli Studi di Pavia

2. Energy and Foreign Policy Energy security: reliable and affordable energy supply key: energy is a commodity (+ externalities) Energy Security Energy supply is a function of technology and availability of resources The relevance of geography is shaped by the technological perspective caveat: risk is usually interpreted against an implicit status quo scenario

3. Energy and Foreign Policy Risk is always related to a certain technology and it is always an issue of opportunity costs key: geography vs. technology Resources: an uneven distribution The key issue is that fossil fuels are unevenly distributed across the globe e.g. 56% of oil reserves and 75% of gas reserves are located in Middle East and Former Soviet Union Need of trade between different States, hence the origin of geopolitical risk

4. Energy and Foreign Policy Oil and gas are the most important elements of the Italian (80%) and European (60%) energy mixes key: oil is more liquid than gas Oil and gas markets Gas market is regional and more rigid: infrastructures influence the relationship between producers and costumers (long term) and the institutionalisation of the markets (segmentation, indexation) Oil market is global and liquid: cheap transportation, flexibility, market institutionalisation Gas market is changing (LNG, non-conventional, spot markets), but slowly

5. Energy and Foreign Policy EU dependence: 90% oil, 65% gas - Italy dependence: 90% oil, 90% gas Energy Consumption and Import Dependence 2011 - Source: elaboration on BP, Statistical Review of World Energy 2012

6. Energy and Foreign Policy Import Dependence Source: elaboration on BP, Statistical Review of World Energy 2012

7. Energy and Foreign Policy Energy Mix - World and EU Source: elaboration on BP, Statistical Review of World Energy 2012 World (2011)European Union (2011)

8. Energy and Foreign Policy Energy Mix - France 2011 - Source: elaboration on BP, Statistical Review of World Energy 2012

9. Energy and Foreign Policy Energy Mix Evolution - France Source: elaboration on BP, Statistical Review of World Energy 2012

10. Energy and Foreign Policy Energy Mix - Germany 2011 - Source: elaboration on BP, Statistical Review of World Energy 2012

11. Energy and Foreign Policy Energy Mix Evolution - Germany Source: elaboration on BP, Statistical Review of World Energy 2012

12. Energy and Foreign Policy Energy Mix - United Kingdom 2011 - Source: elaboration on BP, Statistical Review of World Energy 2012

13. Energy and Foreign Policy Energy Mix Evolution - United Kingdom Source: elaboration on BP, Statistical Review of World Energy 2012

14. Energy and Foreign Policy Energy Mix - Italy 2011 - Source: elaboration on BP, Statistical Review of World Energy 2012

15. Energy and Foreign Policy Energy Mix Evolution - Italy Source: elaboration on BP, Statistical Review of World Energy 2012

16. Energy and Foreign Policy EU Natural Gas Supply 2011 - Source: elaboration on BP, Statistical Review of World Energy 2012

17. Energy and Foreign Policy European Natural Gas Main Infrastructures © Matteo Verda

18. Energy and Foreign Policy Italian Natural Gas Main Infrastructures © Matteo Verda

19. Energy and Foreign Policy Italian Natural Gas Consumption Source: elaboration on BP, Statistical Review of World Energy 2012

20. Energy and Foreign Policy Matteo Verda, PhD email: matteo.verda@unipv.itmatteo.verda@unipv.it blog: www.sicurezzaenergetica.itwww.sicurezzaenergetica.it LinkedIn: www.linkedin.com/in/matteoverdawww.linkedin.com/in/matteoverda Twitter: @matteoverda Contacts Politica estera e sicurezza energetica. L’esperienza europea, il gas naturale e il ruolo della Russia Edizioni Epoké, 2012