Editor's letter

Gazprom has started the year collecting more bad press. Russia is now being branded an 'energy bully' in the mainstream papers for supply issues with Ukraine and Georgia. Oliver Holtaway's article on page 10 cuts through some of the hype to ask what Gazprom's European customers think.

Assessing political risk is never easy, but merely demanding that Europe diversify away from dependency on Russian gas is not a practical solution in the short term. Admitting dependence and addressing political relations with Russia would appear to be the most sensible first step.

The increasing globalisation of today's energy markets is a dominant theme of 2006, and this is reflected in this year's Commodity Rankings. We received more votes this year than ever before. Goldman Sachs and Morgan Stanley once again emerged as the giants of energy trading, with Icap and TFS leading the brokers' rankings.

Judging by the number of votes alone, markets such as emissions trading and Eastern European electricity are attracting more interest. This year's survey included for the first time a category on structured products, where competition between banks to produce innovative and bespoke product offerings is rife.

Overall, the rankings reflect the increased interest and number of players in the market, and, although this makes for fierce competition, most players welcome this.

Of course, the larger market size has specific implications for credit managers, and this is addressed in our Credit Risk supplement, a collection of articles looking at this important area from four different angles.

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