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Energy set to take spotlight at Russia-EU summit

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Officials from Russia and the European Union will gather on the Black Sea Thursday for a summit that it is expected to be dominated by the host nation's reliability as an energy supplier.

MOSCOW, May 25 (RIA Novosti) - Officials from Russia and the European Union will gather on the Black Sea Thursday for a summit that it is expected to be dominated by the host nation's reliability as an energy supplier.

European Commission President Jose Manuel Barroso and Austrian Chancellor Wolfgang Schuessel, the current president of the EU Council, will arrive in the popular resort of Sochi to discuss with Russian leader Vladimir Putin how to develop relations in the sphere and how to iron out problems.

Russia's role has come increasingly under the microscope since a pricing dispute with neighboring Ukraine in January saw energy giant Gazprom turn off natural gas supplies, which not only led to shortfalls on the continent but also provoked accusations - none so forcefully put as U.S. Vice President Dick Cheney's claims in Vilnius on May 4 - that Russia was using its vast energy resources as a way to blackmail other countries.

Benita Ferrero-Waldner, the EU commissioner for external affairs, highlighted Tuesday the importance of energy for both sides at the summit.

"Energy is a fundamental element in the partnership between Russia and the EU - for both partners," she said. "You are an important supplier of energy products for us, and we are your most important economic partner. So certainly, how to get the most out of this interdependence will be a major topic at the summit."

Comments made in April by Gazprom chief executive Alexei Miller that Russia would look to Asia and South America if the concern's European expansion plans were blocked prompted talk in Brussels and beyond that energy supplies had to be diversified, and raised accusations of hypocrisy given that foreign firms are banned from developing certain lucrative deposits in Russian for "strategic" reasons.

But the commissioner hinted that Russia, which covers 25% of the EU's natural gas needs, stood to gain by dropping what some Europeans see as bullying.

"We already have a good channel for co operation through our Energy Dialogue and we are ready to go further," she said. "But this relationship can only grow on the basis of reciprocity in markets, infrastructure and investments. This will create a win-win energy relationship for the EU and Russia. Transparency and openness are also crucial to competition in the global energy sector."

Russia has dismissed claims of strong-arm tactics - it says it merely wants to reach market-level prices with countries that have long enjoyed hugely subsidized supplies - and has defended its reliability as an energy partner and at least one senior official has said that the country shares the West's values.

With the country set to host its debt summit of the Group of Eight industrialized nations in July, Russian representative to the group and influential presidential aide Igor Shuvalov said during a May 16 briefing that Russia and Russian companies had always fulfilled their contractual obligations.

"No one had ever questioned the reliability of hydrocarbon supplies from Russia until the Ukrainian incident," he said.

In an interview with daily newspaper Nezavisimaya Gazeta on Wednesday, the aide went even further.

"We are prepared to provide Europe with oil and gas on a long-term basis, and we are taking on the role of the leader," he said.

European officials have also urged Russia to ratify the Energy Charter Treaty, which was signed in The Hague in December 1991 as a mechanism spelling out the terms of energy cooperation between eastern and western Europe.

In 2003, 51 European and Asian states joined the charter. Seventeen countries and 10 international organizations have the status of observers. Russia has signed but not ratified the treaty as Europe has demanded access for Central Asian states and other countries to its pipelines, which Moscow says will make their natural gas 50% cheaper than Russia's when it arrives in Europe.

However, Ferrero-Waldner was optimistic that a deal could be done. "It would be excellent if Russia seized the moment, as President of the G8, to move towards ratification of the Energy Charter Treaty,"

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