Putin's Hungarian divertimento on the South Stream theme

Putin's trip to Budapest will make news waves with a fresh salvo of commentaries on the proposed offshoot to Bulgaria from the Turkish Stream. The Russian President is a master of firing information bombs and seeing the media and political landscape resonate with Gas Streams' divertimentos. I have learnt from experience that there is no need to haste immediate conclusions. We should not take anything the Russian leader says at face value, notably in the middle of an information and propaganda warfare.

Yet why did he make the announcement in Budapest, while standing by one of his only remaining friends in Europe?

Putin miscalculated by making the announcement on the South Stream rerouting in Ankara - definitely not the best place to address the Balkans, where most people keep tense memories of the Ottoman past. While Ataturk's Turkey has been the closest approximation of a truly European Turkey, Erdogan's neo-osmanic drive has stirred mixed emotions and outright resentment throughout the region. PM Borisov, who is known for being soft spoken on anything coming from the Kremlin, went out of his way, angrily reminding Putin that the last place he would expect to be addressed from is Ankara. Even the russophiles, used to Russia's classic balancing off Turkey's influence in the region, were caught off guard incapable of digesting the rapprochement between the Russian and the Turkish leaders.

The rerouting of the South Stream left most of Putin sympathizers in Bulgaria, Serbia, Hungary, Croatia and Slovenia aghast - without financial and political pivot. It has been hardly a secret that most of the political and public levers Moscow can pull in the region are regularly "oiled" via Russian or Russian related business financial flows. In each of the transit countries a good chunk of the inflated South Stream budgets were meant to end up in EU skeptics and NATO opponents.

Immediately after the Turk Stream was announced, Kremlin immediately launched a plan B to service the vacated markets in the South Stream countries, drawing arbitrary maps for gas supplies through Greece, Macedonia and Serbia with the idea of bypassing the stubborn Bulgarians. More virtual reality exercises were forced upon the Balkan people in the vain hope that Europe will blink first.

With the geopolitical Turk Stream mist being gradually lift the hard facts settle in - there is not rush on the side of the EU to engage in costly infrastructure build up just to make good Gazprom's plan to sell gas from Turkey. Instead the EU Energy Union gradually starts to take shape.

Soon Putin realized that visiting even his closest friend Orban he will not be able to deliver anything sensible in terms of competitive gas and alternative supplies, should Moscow pursue its plans to close down transit through Ukraine.  Without  a credible game plan for gas supply via Turk Stream and aggressive word mongering coming from Moscow, Gazprom faced the immediate prospect of loosing dominant market shares in most of the countries serviced through Ukrainian transit - some 40 billion cubic meters. Worst of all - Ukraine managed to lower imports of Russian gas and beef up reverse flow supplies in just one season to over 5 billion cubic meters with significantly larger potential on the horizon.  Poland, Slovakia and the Czech Republic have already resolved the critical issue of dependence on Russian gas. Romania is expected to become self sufficient in the coming years. New quantities of non Russian gas have emerged further South and Putin seems unable to challenge them.

His gamble on Turk Stream has backfired - hence the offshoot to Bulgaria option floated in Budapest. With all the recent rhetoric unleashed he needs to help Gazprom regain the trust of its customers following frantic rerouting games with Russian gas flows in the Southern Corridor.