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The Cold Road to Europe

By Alex Calvo

SNA (Barcelona) — The long string of incidents off the Senkaku-Diaoyu Islands this summer and the wider maritime territorial disputes in East and Southeast Asia have been overshadowing a major development with great potential implications for Japan: The northern sea route, linking East Asia with Europe through waters traditionally closed by ice to commercial navigation, are increasingly accessible during the Arctic summer thanks to the global warming.

There are still a few days left in the season, but the statistics are already impressive. In early October, the one-million-ton mark had already been passed, with 35 vessels having followed the northern route. Russian authorities were talking about the possibility of reaching 1.5 million tons by the end of the season. In all of 2011, there were only 34 ships and 820,789 tons that took this route, again according to Russian sources.

Different kinds of cargo are being transported, with petroleum products at the forefront. Twenty of the ships carried fuel, gas condensate, and lubricants; the largest single shipment being 66,462 tons of jet fuel from Yosu (South Korea) to Porvoo (Finland) aboard the Norwegian tanker Marika. There have also been four voyages transporting iron ore from Murmansk (Russia) to Huanghua (China), and even one featuring frozen fish from the Kamchatka Peninsula to St. Petersburg.

These developments are of great potential significance to Japan, a country which in past decades, even after the end of the Cold War, has tended to look to the north more with suspicion than to a view for new opportunities. This was in part due to geography and in part due to an uneasy diplomatic relationship with Russia. Although Japanese observers note that the country would benefit from lower reliance on the sea lines of communication running through the South China Sea and the Straits of Malacca, and Russian authorities have repeatedly referred to their need to develop their Far East regions and to pay greater attention to the Asian continent, both policies are still in an embryonic stage. However, if current climate trends in the Arctic are confirmed in future years, and the necessary infrastructure (navigation aids for example) is gradually built, this could provide Japan with a new route to one of its major commercial partners, Europe. Furthermore, it could facilitate energy imports from Russia. Generally speaking, the diversification of trade routes for both imports and exports is always beneficial to the countries involved, and is often an explicit policy goal of governments.

Of course, we must be careful not to exaggerate the significance of the northern sea route. It is likely to remain a junior partner to more established alternatives for a long time to come, but even with relatively modest cargo volumes and being open only during the summer months (which in 2011 meant five months), its availability constitutes a positive factor for Japan, both from a purely economic point of view as well as from a national security perspective. Travel time to Europe might be cut by up to one-third, leading to considerable savings on transportation costs. Unfortunately, however, this may be partially offset by higher insurance premiums.

One of the advantages of the Arctic is the absence of pirates, which has become a significant concern near the Strait of Malacca and near the coasts of Somalia in recent years. There are some territorial disputes along the northern sea route, but these have so far been addressed peacefully, with Norway and Russia, for example, able to reach an agreement to lay down their maritime border, a goal somehow eluding many East Asian nations.

Could lesser reliance on the South China Sea reduce tensions there and facilitate some sort of agreement among the parties involved?

It is difficult to say. On the one hand, if it were not so vital for Japan as it is now, Tokyo may have less incentive to support countries like Vietnam and the Philippines and could take a more relaxed attitude toward events in its southern waters. This might reduce bilateral tensions between Japan and China. However, by drawing down third-party support for the smaller countries, it might also make a clash between them and Beijing more likely. Whatever the answer to this question, from a Japanese national security perspective reducing the proportion of oil and natural gas imported through the South China Sea would increase energy security.

Of particular interest to Japan is the possible opening of the Arctic to tankers carrying natural gas. Some Russian projects are increasingly geared towards LNG at the expense of pipelines. This is the case, for example, of the Shtokman Field, jointly developed with Norway. LNG provides more flexibility and serves well Moscow’s goals of diversifying away from Western Europe, selling more to Asia, and avoiding excessive reliance on exports to Beijing.

On the other hand, we can see how Russian authorities have already begun the preparatory technical work to allow such voyages to take place. To be more precise, this summer was witness to a six-day voyage in ballast by LNG tanker Ob River. The purpose of this trip was to gather technical data and to check whether it was viable, both from a safety as well as a commercial perspective, to ship LNG through the northern sea route. The tanker, chartered by Gazprom Marketing and Trading, set sail from South Korea to Russia.

Actually, the Norwegian company Knutsen OAS Shipping had already received permission earlier this year from Russian authorities to transport LNG from the Snohvit Gas Field to Japan through the northern sea route, but an actual voyage has yet to take place.

Alex Calvo is a Professor of International Relations and International Law, European University in Barcelona.