Algeria's conundrum over tensions between Russia and the West

As Russia’s invasion of Ukraine drags on, North African countries have been hit by rising prices of staple goods, creating a new consumer crisis.

Yet as a hydrocarbon-rich nation, Algeria could be presented with new economic opportunities as European countries look to replace Russian energy sources.

Algeria is also trying to adopt a careful balancing act between Russia and the North Atlantic Treaty Organization (NATO) member states which have imposed economic sanctions on Moscow.

"Algeria will hope to continue its independent foreign policy where it can balance between both Europe and Russia"

Retaining ties with Europe is important for Algiers to acquire potential energy exports, while Russia has been an invaluable security and strategic partner. Thus, Algeria will hope to continue its independent foreign policy where it can balance between both Europe and Russia.

On 11 April, Algerian President Abdelmadjid Tebboune and Italian Prime Minister Mario Draghi struck a deal for Algiers to supply gas to Rome. Per the deal between Algeria’s Sonatrach and Italy’s Eni, Algiers will send 9 billion cubic meters of gas to Rome by next year and in 2024.

“Right after the invasion, I announced that Italy will move with speed to reduce dependence on Russian gas. This agreement is a significant response to that strategic objective. There will be others,” Draghi said after the meeting.

In March, Sonatrach and Eni announced finding a “significant” oil and gas field in the Algerian desert, which both companies will jointly explore.

Following this, on 10 May, Russian Foreign Minister met with Algerian President Tebboune, with the aim of enhancing bilateral ties in various sectors, from military to humanitarian areas.

Following the meeting, Lavrov referred to the two countries’ “military and technical cooperation” while praising “the confidence placed in us (by Algeria) in this domain”.

Military partnership

Both Algeria and Russia have adopted a similar stance of flexibility in the Middle East and North Africa.

Regarding various disputes in the region, Algeria is more aligned with Russia’s position and seeks to uphold positive ties with most actors - even though its media often invokes anti-imperialist sentiment, which explains the historic amicability between Algiers and Moscow.

Although Algiers was a prominent member of the Non-Aligned Movement during the Cold War, it still established close ties to the Soviet Union. Many of its political and military leaders trained there. And during the Cold War period, the Soviet Union and Algiers struck several arms agreements.

After the fall of the Soviet Union, Vladimir Putin sought to further strengthen ties between the two countries after visiting Algiers in 2006.

That year, both countries signed a Memorandum of Understanding (MoU) concerning the Russian and Algerian gas companies Gazprom and Sonatrach. While causing some alarm to EU observers, the MoU entailed that Gazprom would help Algeria develop its natural gas reserves.

Further demonstrating its determination to be a reliable ally of Algiers, Moscow has forgiven billions of dollars of Algerian debt, while Algeria sought Moscow’s assistance in 2019 against the mass anti-government protests, which forced former long-standing president Abdelaziz Bouteflika to resign.

For Algeria, regional tensions have driven it towards Moscow and have propelled its desire to increase its arms imports.

Currently, Algeria is Moscow’s third-largest arms customer after India and China, and Algiers’ purchases account for around half of Russia’s arms exports to Africa. Russia is also Algiers’ largest arms partner.

And showcasing its wishes to maintain ties with Moscow despite the war in Ukraine, Algeria agreed with Moscow on 5 April to carry out joint military exercises on the border of Morocco – with whom Algiers has sour relations.

The exercises will include training for tactical moves to search for, detect, and destroy illegal armed groups. About 80 soldiers from the southern military region will participate and will take place at the Hammaguir base in southern Algeria. The manoeuvres are scheduled for November 2022.

"Algeria is Moscow's third-largest arms customer after India and China, and Algiers' purchases account for around half of Russia's arms exports to Africa"

Such exercises are a continuation of similar activities, such as in October 2021 when both armies trained in the North Ossetia region, aiming to increase their effectiveness and further their counter-terrorism cooperation.

Moscow’s support for Algeria helps it over the Western Sahara dispute, in which the US supports Morocco’s stance, having recognised Rabat’s sovereignty over the territory.

Thus, given Russia’s supportive stance towards Algeria over military partnerships, and how much of a vital ally it is, US pressure on Algeria would be unlikely to deter it from scaling down its ties with Moscow.

Yet amid the Ukraine war, Washington has already attempted this. In late March, US Secretary of State Antony Blinken urged Algeria to limit ties with Russia.

Blinken also urged Algeria to repair its fraught ties with Morocco, particularly regarding the dispute over Western Sahara, over which Washington has still upheld recognition of Rabat’s sovereignty. Such a move would therefore be unlikely to sway Algeria into moving away from Moscow.

Economy

After all, European officials are still considering how they can gradually phase out Russian energy sources and look for alternative suppliers.

Currently, Algeria already covers nearly 12 percent of EU gas imports, including via pipelines to Spain and Italy, and its exports accounted for 3 percent of oil imports in 2020.

Italy, Spain and other European Union member countries would see Algeria as a hopeful alternative to their dependence on Russian oil and gas.

While there could still be competition from other countries, including Qatar which has been dubbed as another potential partner to replace Russian energy, Algeria is in a key position to supply other countries, particularly as more deals could be on the horizon after Algiers and Rome’s agreement.

Concerns have been raised over competition between Moscow and Algiers, particularly over supplying energy to Europe. Yet given the tensions between Russia and NATO, and that Europe is keen to find new suppliers, Algeria’s appeal as a potential supplier has put it in a pole position to help Europe wean away from its dependency on Moscow.

Meanwhile, Algeria will look to continue to play a key role in OPEC given the Algerian presidency, as OPEC has worked with Russia to reduce production to keep oil prices stable.

"Italy, Spain, and other European Union member countries would see Algeria as a hopeful alternative to their dependence on Russian oil and gas"

Meanwhile, although its ties with Moscow may not be a significant obstacle, there may even be practical considerations for Algiers in meeting Europe’s demand.

For example, Algeria could lack the capacity to supply to Europe fully, at least in the short term. Moreover, Algeria would likely have to placate its own domestic demand first following an increase in recent years, meaning that exports may not substantially increase.

Secondly, despite any potential increase in energy revenues, Algeria could still look to focus on other sectors of its economy, rather than continuing a risky over-reliance on energy.

Such a move could leave it vulnerable to future market fluctuations or efforts to wean itself away from a hydrocarbon dependency.

Jonathan Fenton-Harvey is a journalist and researcher who focuses on conflict, geopolitics, and humanitarian issues in the Middle East and North Africa

Follow him on Twitter: @jfentonharvey