The paper analyses geopolitical circumstances in the energy markets in the first decades of the 21st century. After oil prices leap, gas crisis in Eastern Europe, and geopolitical instabilities connected with energy issues, the gas supply has entered into the phase of possible supply crises, political instability and major disturbances. Such a scenario could have an adverse impact on energy importers and their efforts to ensure secure and affordable supply, especially when it comes to relatively small countries in the SEE region.

Geopolitical developments mainly result from an uneven distribution of global oil and gas production and consumption. They affect all participants in the global energy market, particularly those with small indigenous production. Croatia meets 60 percent of its gas demand from domestic production but this share will decline. Similarly to other SEE countries, it will need more imported energy, particularly oil and gas. Participation and cooperation in large international transport and supply projects is the most likely solution for securing sufficient energy.

The SEE countries have been heavily hit by global economic crises. Investments in energy sector have been postponed due to the recession. Economic recovery (investments) is crucial for ensuring energy security & supply. Therefore it is important to design appropriate energy strategies and create attractive conditions for investments. Croatia is making efforts in this direction. It will facilitate the cooperation in international energy projects and further development of natural gas market and infrastructure in the SEE region.

Croatia has some advantages as the future possible gas market hub: geopolitical and geographic position, political stability as EU member state, considerable domestic natural gas production in addition to connections to the several European gas routes and possible LNG entry point into the South-East European gas market.

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