Gas Discoveries in Cyprus: The Limits of Russian Influence

Abstract

Offshore gas discoveries around Cyprus have brought several external actors to the region. Energy companies from the European Union, the United States and the Middle East acquired exploration rights and obtained stakes in projects of infrastructural  development. While energy giants tied to these actors secured important shares in the currently developing Greek Cypriot gas  industry, Russia is notably absent from the beneficiaries. The absence is particularly noteworthy as Russia has otherwise developed significant energy deals with other regional actors and exerts extensive economic influence over the Republic of Cyprus. This study
seeks to examine why the Russian gas involvement did not materialise in Cyprus and why Moscow remained distant from the
Greek Cypriot gas opportunities. It argues that not only systemic but also domestic factors constrained the expansion of Russian
gas interests. To unpack the causes of this absence, the paper applies the theory and analytical framework of neoclassical realism
and interprets foreign policy outcomes through the lenses of systemic and domestic variables. The study concludes that Moscow
sacrificed its gas opportunities in Cyprus due to several structural and unit-level factors, including recognising Turkish interests in
the island’s energy disputes, protecting the regional stakes of national energy companies, and maintaining Russian positions in
the Greek Cypriot financial sector.