Natural gas is one of the key economic engines of Russia. Gazprom, the state-controlled gas producer, is the world’s largest exporter of the commodity, accounting for about 15 per cent of global supplies. Could the boom in shale gas challenge the leadership of Russia in gas? Until now, Moscow and Gazprom have seemingly been nonchalant about the threat. But as the impact of the boom in US natural gas production becomes clear, depressing prices to levels not seen in 10 years and increasing the prospect of the country becoming an exporter, the Kremlin is beginning to pay attention. The biggest risk for Russia is not the US shale gas but the potential of the development of similar reserves in neighbouring Bulgaria, Romania, Poland and Ukraine. Eastern European countries are racing to tap shale deposits using the same technology – hydraulic fracturing, known as fracking, and horizontal drilling – used in the US gas industry. Gazprom supplies Europe with about 20 per cent of its gas needs, so the development of shale deposits in its backyard is a serious long-term threat.