The Oil And Gas Industry And The Sale Of Influence

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THE OIL AND GAS INDUSTRY AND THE SALE OF INFLUENCE

Consultancy agreements, the oil and gas industry and the sale of influence

Consultancy agreements, the oil and gas industry and the sale of influence

Introduction

In the 1980s and 1990s, privatisation and liberalisation of European gas markets emerged on the political agenda. Back then, “many of the established actors in European gas industry still regarded the introduction of liberalisation as the equivalent of the end of civilisation” (Stern, 1998: 91). Ever since, attempts to liberalise European gas markets were facing strong opposition and resistance from the industry and industry-oriented governments, aiming to maintain the status quo of market organisation.

Initially ambitious regulatory targets from the European Commission boiled down to a very basic introduction of competition and liberalisation in form of the first gas directive. However, the European gas reform marks the starting point for restructuring the gas sector and its economic governance. European gas markets have gone through profound restructuring processes in the last 10 years. In 1998, the European gas market resembled a patchwork of national markets with highly heterogeneous regulatory regimes. Since then, a European gas market reform attempted to integrate and harmonise gas markets while asking for country-specific solutions to take into account different national characteristics. In early 2000, the European Commission (EC) expressed the over-optimistic expectation of reaching full liberalisation by 2004.

Two years later, the European gas market reform was described as a patchy process. In 2007, the EC officially spoke out about what many observers were claiming for years: European gas markets lacked competition, cross-border integration, and harmonisation. Due to the discretion of the European framework regulation, member states could choose to a large extent which regulatory instruments to apply.

As a consequence, the reform brought about a divergent convergence of regulatory regimes which now functions as a framework for natural gas market organisation in the European Union. This study aims to assess the degree and direction of policy convergence applied to regulatory regimes that came into existence in order to realise European gas market liberalisation. We assess the regulatory regimes of national gas markets in Europe over time, covering the gas market regulation in the old member states. We concentrate on policies affecting the downstream part of the gas value chain that is subject to the reform. The period under study begins with the implementation of the first Gas Directive in 2000 and lasts until the end of 2005. Our leading question is 'Are regulatory regimes moving towards convergence?' Complementarily, we explore common patterns or paths that member states follow. To capture the dimension of rate and degree of convergence, the following sub-questions guide our analysis: 'Are some countries moving towards a best-practice model faster than others?' (rate of convergence) and 'how much do the member states decrease the distance of their regulatory regime towards a best-practice model?' (degree of convergence).

The second question necessitates developing a methodology which allows the deduction of a so-called best-practice model from the European legislation and economic theory and then ...
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