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The Political Economy of European Natural Gas Markets

Davis, J. D. The Political Economy of European Natural Gas Markets. Cooperation and Conflict, XVIII , 1983, 3-20. The natural gas market, like Caesar's Gaul, is in three distinct parts: production, transmission and distribution. Critical to the relations between the stages is stability — a form of functional equilibrium not unlike that of solutions to a three person cooperative game. After defining stability and instability in natural gas markets, this article examines the manner in which state and industry cooperate both nationally and internationally to provide a stable basis for trade. The nature of European trade in natural gas is then analysed and the forms of industry-state cooperation are highlighted.