How Fossil Fuel Addiction Funded Putin and Fueled a Global Crisis
Europe’s reliance on Russian fossil fuels shaped Putin’s power while delaying critical climate action against a mounting crisis.
The long-standing dependence of Europe and the wider world on Russian fossil fuels not only provided crucial funding for President Vladimir Putin’s regime, but also significantly delayed the necessary transition to clean energy. As governments and companies finally move to sever these ties under the shadow of war and climate emergencies, the story reveals deep-seated complicity and raises urgent questions about the future.
The Roots of Dependency: Post-Soviet Russia Opens Up
After the collapse of the Soviet Union, Russia entered a period of economic hardship and opened its vast fossil fuel reserves to international investment. For Western oil majors, this was an unmatched opportunity. By the time Putin rose to power in 1999–2000, global giants like Total, ExxonMobil, and Shell had already secured lucrative production-sharing agreements on major Russian oil and gas projects.
- Total acquired the vast Kharyaga Arctic oilfield
- ExxonMobil took the Sakhalin 1 development
- Shell led Sakhalin 2, another immense project on the island north of Japan
These projects unlocked enormous reserves:
- Sakhalin 1: 2.3 billion barrels of oil, 485 bcm of gas
- Sakhalin 2: 1.1 billion barrels of oil, 684 bcm of gas
If fully extracted and burned, these fields alone would release over 3 billion tonnes of CO2—more than the annual emissions of India.
They Knew the Risks
By the early 1990s, Shell and Exxon were already aware of the implications of fossil fuel combustion for climate change. Internal documents—from Shell in 1988 and Exxon in 1982—predicted severe impacts such as rising temperatures, flooding, habitat destruction, and mass migration. Instead of acting, fossil fuel companies sought to cast doubt on climate science, continuing with profitable new developments.
How Fossil Fuels Powered Putin’s Regime
The influx of foreign capital and expertise helped Russia modernize its extraction technology and tap reserves previously beyond its reach. This had profound implications, both for Russia’s economy and geopolitical ambitions.
- By 2021, taxes and dividends from oil and gas companies accounted for 45% of the Russian federal budget.
- Since 2014, major projects backed by European and U.S. companies supplied nearly $100 billion in revenue, fueling state initiatives and military spending.
European energy dependence was entrenched, especially for natural gas. The controversial Nord Stream and Nord Stream 2 pipelines exemplified the risks—tying Europe’s heat, power, and industry to Moscow’s will.
Too Little, Too Late: The Exodus From Russia
The invasion of Ukraine in 2022 forced a reckoning. Under pressure, many energy majors announced their withdrawal from Russian markets, yet for years their investments had already built up the very system now being fought on Europe’s doorstep.
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Even after the annexation of Crimea in 2014, companies and governments pressed ahead with deals and projects, ignoring warnings about the nature of Putin’s regime. Only when war and human rights abuses became unignorable did disengagement occur—often leaving behind sunk infrastructure and supply contracts.
Delayed Divestment—The Consequences
- Europe’s slow exit came after decades of energy security warnings and only in response to war, not climate imperatives.
- This delay funded both military aggression and contributed to global emissions incompatible with the Paris Agreement target of 1.5°C warming.
Climate and Security: Two Crises, One Solution
The Russian invasion and the global fossil fuel crisis are deeply intertwined. Fossil fuel addiction is a threat multiplier: empowering authoritarian regimes, destabilizing economies, and accelerating climate disasters.
According to the International Energy Agency and the Intergovernmental Panel on Climate Change (IPCC):
- No new oil and gas fields are compatible with reaching net zero emissions.
- Half the global population is already highly vulnerable to climate-related disasters.
- The summer of 2022 saw record heatwaves in Europe and China, and catastrophic floods in Pakistan affecting a third of the country.
Yet, even amid the urgent need for emissions cuts, Russia’s own policies remain fixated on maximizing fossil fuel exports—while official climate pledges are unambitious and allow emissions to continue rising till 2030.
Russia’s Promises Versus Reality
| Year | Public Target | Reality |
|---|---|---|
| 2015 | Emissions 25–30% below 1990 by 2030 | Targets easily met due to post-Soviet recession; emissions rising under Putin |
| 2021 | Net zero by 2060 | No credible near-term action; energy strategy still focused on fossil fuels |
Russia is the world’s second-largest oil and gas producer, and its exports drive global emissions not captured in its national accounting.
Europe’s Shift: How Much Has Changed?
Before the war, Europe sourced:
- 45% of its gas from Russia
- 27% of its oil
By 2023, Germany—Europe’s industrial heavyweight—was receiving 0% of its gas, oil, and coal from Russia. Yet, this turnaround came at high cost and after prolonged inaction.
The main lessons?
- Dependency delayed decisive climate action.
- Financial markets had propped up fossil fuel expansion until the crisis forced a change.
- Rapid, large-scale investments in renewables only arrived once the political and moral costs of continued fossil fuel reliance became impossible to ignore.
Progress and Roadblocks
- 2022 saw record renewable installations and surging electric vehicle sales worldwide.
- Still, global energy transition efforts must accelerate to avoid both geopolitical and climate disasters.
The Fossil Fuel Industry: Complicity and Delay
The fossil fuel industry, especially the oil majors, did not act in ignorance. For decades, they knew the environmental, geopolitical, and moral risks of their business model, but continued to pursue new extraction—greenwashed by token climate programs on the sidelines.
Today, many companies tout their investments in clean energy, but these remain marginal compared to ongoing fossil investments that perpetuate both climate danger and political unrest. Their provision of advanced technology enabled projects that now stand as “carbon bombs”—fields so large their full exploitation threatens any hope of carbon budget discipline.
Paths Forward: Ending the Double Crisis
There is only one effective response: make the fossil fuel era history by investing massively and urgently in renewables, storage, energy efficiency, and electrification.
- Cut financial strings to oil and gas—banks, insurers, and asset managers must redirect capital away from fossil fuel expansion.
- Accelerate policy reform—governments should end fossil fuel subsidies, impose strong carbon pricing, and foster international cooperation for green energy build-out.
- Empower citizens and communities—through energy democracy, protecting the vulnerable, and ensuring a just transition for workers.
The current energy shock is more than a geopolitical upheaval: it is a final warning. Reliance on fossil energy enables aggression abroad and climate chaos at home. The transition is not simply environmental—it is the key to security, democracy, and survival.
Frequently Asked Questions (FAQs)
Q: What role did European fossil fuel payments play in the Russian invasion of Ukraine?
A: Revenue from European fossil fuel imports—especially gas—provided up to 45% of Russia’s federal budget, financing state initiatives, including military spending. This continued even after warnings post-2014 annexation of Crimea, until large-scale aggression made continued trade untenable.
Q: Did Western oil companies know about the climate and geopolitical risks of their Russian operations?
A: Yes, oil majors like Shell and Exxon had documented internal warnings about climate impacts since the 1980s, yet continued expanding Russian operations through the 2000s. Their activities contributed directly to both climate change and the empowerment of Russia’s government.
Q: Why is divesting from fossil fuels critical now?
A: Continuing fossil fuel extraction is incompatible with the international goal of limiting warming to 1.5°C. It also enables undemocratic regimes, destabilizes markets, and delays the transition to reliable, renewable energy systems. Divestment is crucial for both climate and global security.
Q: Has the energy transition accelerated, and is it enough?
A: While growth in renewables and electric vehicles has hit records since 2022, this is only a start. The pace must increase significantly worldwide to fully replace fossil fuels and avert further crises.
Q: What concrete actions can governments and individuals take?
A: Governments should enact strong climate policy, redirect public and private finance to green energy, and ensure a just transition for affected workers. Individuals can support these changes through voting, advocacy, energy efficiency, and adoption of clean technologies.
References
- https://www.globalwitness.org/en/campaigns/fossil-gas/how-big-oil-helped-russia/
- https://www.business-humanrights.org/en/latest-news/opinion-putins-aggression-is-last-call-to-end-global-fossil-fuel-addiction/
- https://www.climatechangenews.com/2024/03/12/despite-putin-promises-russias-emissions-keep-rising/
- https://www.brookings.edu/articles/putins-war-and-european-energy-security-a-german-perspective-on-decoupling-from-russian-fossil-fuels/
- https://www.cleanenergywire.org/dossiers/putins-war-against-ukraine-and-its-implications-german-and-eu-energy-transition
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