If the Russian government responds to Gazprom's proposal and intervenes in the export agreements on Sakhalin-1, China will not have any access to Russian gas, despite a growing need for energy supplies to power its booming economy.
Such an action will also heighten concerns over the growing influence of state-run Gazprom and the Kremlin's grip on its domestic gas industry.
Russian gas accounts for 25% of supplies to the European Union (EU).
But critically, it means that gas shortages in Russia must be more serious than what is being said, analysts believe.Update: IEA Studies Safety Net for Natural-Gas Supply, Official Says
By Stephen Voss and Mathew Carr
June 19 (Bloomberg) -- The International Energy Agency, an adviser to 26 oil-consuming nations, may build a ``safety net'' of natural-gas stockpiles to buttress supply, said the agency's executive director, Claude Mandil.
``The safety net for natural gas is to be studied and considered,'' Mandil said today at the Financial Times Global Energy Leaders Summit in London.
The plan for stockpiles is likely to be different from the oil industry's safety net of crude and oil products, he said. ``It is a must for OECD countries and all consuming countries.''
The IEA has also started discussions with other, non-IEA consuming nations, including China and India, he said.
To contact the reporters on this story: Stephen Voss in London atLast Updated: June 19, 2007 06:12 EDT Mathew Carr in London at