The Influence of Contradictions in Russia-EU Energy Cooperation on the Activities of Multinational Oil and Gas Companies

In this paper we consider the impact of the contradictions of Russian-European energy cooperation on the activities of international oil and gas companies on the example of the Hungarian oil and gas concern MOL GROUP and the Bulgarian company LUKoil Neftochim Burgas. Special attention is paid to the comparison of the intensity of MOL GROUP's cooperation with Russian partners and LUKoil Neftochim Burgas's cooperation with Bulgarian partners before and after the implementation of European economic sanctions. The paper identifies the role of political risk, as well as other factors affecting the reduction of the intensity of this cooperation from the perspective of the theory of “obsolencing bargain mechanism”. The first chapter presents the theoretical aspects of the influence of political contradictions on the activities of international oil and gas companies, as well as the specifics of the Russian-European energy contradictions. The second chapter is devoted to the analysis of the evolution of MOL GROUP's cooperation with Russian partners and LUKoil Neftochim Burgas's activities in Bulgaria and the identification of the factors that cause the decrease in the intensity of this cooperation. The final part of the paper presents the conclusions, future trends as well as recommendations for researchers and companies. On the basis of the study, on the one hand, there were made conclusions about the significant impact of the political factor on the activities of international oil and gas companies and, on the other hand, about the impossibility of considering the impact of political risk in isolation from economic background.