Russia was on the defensive at the start of a major energy conference on Monday, emphasizing the need for massive investment and guaranteed demand if it is to fulfill its role as a guarantor of global energy security.

The two-day conference on international energy security, which precedes a meeting of the Group of Eight energy ministers on Thursday, comes amid sky-high oil prices and rocketing demand in developing countries such as China and India. Russia has put the topic at the head of the agenda for its G8 presidency this year, positioning itself as a leader in safeguarding global energy supplies.

"We have set ourselves the task of providing the world with energy resources on a reliable, long-term basis," Foreign Minister Sergei Lavrov said at the conference. "Russia can make a constructive contribution toward fulfilling this task, and is already doing so."

But even as Russia touts its role, the European Union is seeking to reduce its dependence on Russian energy, spooked by growing state involvement in the sector and recent drops in gas delivery.

Gazprom deputy CEO Alexander Medvedev aggressively refuted doubts about the monopoly's reliability as an energy partner, blaming the media for stoking European fears during Gazprom's price dispute with Ukraine earlier this year.

"Gazprom was, is and will be a reliable guarantor of gas supplies to Europe," Medvedev said at the conference to a smattering of applause.

Gas supplies to Europe fell in January and February, fueling European calls to diversify away from Russian energy. The most recent came in an EU green paper on energy security last week that said "a true partnership" with Russia was lacking.

Speaking on the sidelines of the conference, Medvedev called the EU's approach "unilateral" and "totally unjustified," as it failed to take into account Gazprom's need for reliable, long-term buyers.

"You can't have road safety by taking care of pedestrians without thinking of drivers' security, too," he said.

"[EU] dependency is only going to increase," Medvedev said. "There are only four sources of gas in the world: Qatar, Iran, Algeria and Russia."

When asked whether Russia was the only one of the four that could be considered stable, Medvedev said, "You can answer that question yourself."

The European Union is Russia's largest energy consumer, with Gazprom supplying one-quarter of Europe's natural gas.

"Without the interests of suppliers, sufficient responsibility by transit countries and adequate access by producers to liberalized European markets, all this talk is good only for the journalists who use Gazprom to scare little children," Medvedev said.

Compounding concerns about gas supplies are worries about the lag in Russian oil production growth, which hit a high of 13 percent year on year in 2003, but had fallen as low as 2 percent by January 2006 as compared to January 2005.

U.S. Deputy Energy Secretary David Sampson echoed the frequent Western contention that the state's hand in the sector was hampering growth, telling the conference that "opportunities are lost when governments fail to welcome private capital."

"Every country has a right to handle its energy resources" as it sees fit, Sampson said on the sidelines of the conference. "I'm here to advocate for the role of markets in allocating capital."

Sampson called on Gazprom to "work more quickly with American companies" in developing Shtokman, a massive natural gas field in the Barents Sea that is thought to contain 3.2 trillion cubic meters of gas.

Gazprom will choose two to three foreign partners for the $20 billion project by April 15, Medvedev said Monday. The shortlist includes American oil majors ConocoPhillips and Chevron, France's Total, and Norway's Statoil and Norsk Hydro.

Asked if increased U.S. dependence on Russian energy carried risks, Sampson invoked Winston Churchill, quoting the former British prime minister as saying: "'Safety and certainty in oil lay in variety and variety alone.' That's what our strategy is," he added.

Energy and Industry Minister Viktor Khristenko offered an oblique response to critics of the state's hand in the energy sector.

"Market reforms are not an end in themselves, but an instrument to raise the efficient and reliable function of world energy," Khristenko told the conference. "An inalienable part of that process is the regulatory role of government in ... eliminating the risks of energy insecurity."

The most immediate solution to the global energy crunch is major new investment, the minister said. He cited an estimate by the International Energy Agency that $17 trillion in energy investment is needed through 2030, two-thirds of it for hydrocarbon extraction and refining.

A significant share of the rising global energy needs comes from China's superheated economy, which has doubled the country's oil and gas consumption in the past decade, LUKoil CEO Vagit Alekperov said during the conference. Average global energy consumption has risen 16 percent during that period, Alekperov said.

Zhang Guobao, deputy minister of China's Development Reform Commission, said that the country planned to boost energy efficiency and increase its reliance on internal resources, such as coal reserves, which are plentiful in China.

Still, Guobao said, "oil extraction in China will remain at the level of 180 to 200 million tons over the next 10 years." And while Chinese imports of oil products dropped from 26.3 million tons in 2004 to 17.4 million tons last year, its overall oil imports increased by 2.4 million tons from 2004 to 2005, reaching 180 million tons last year, according to Guobao.

With such enormous energy demands in mind, numerous conference participants called for an increase in non-hydrocarbon energy sources, especially nuclear power.

Lavrov touted President Vladimir Putin's plan to "open the road of atomic energy to all governments" by making Russia a global provider of enriched nuclear fuel.

Federal Atomic Energy Agency chief Sergei Kiriyenko said the plan would expand developing nations' access to nuclear power while reducing the risk that civil nuclear programs might be used to hide nuclear weapons development -- as the United States accuses Iran of doing.

But with oil and gas likely to fill the bulk of the world's energy needs in the near future, participants also said that energy importers should help Russia foot the bill for helping ensure global supplies.

Russia can act as a stabilizer for the global energy market only if it has guaranteed demand for its resources, said Alexander Shokhin, head of the Russian Union of Industrialists and Entrepreneurs, at the conference Monday.

Total's senior vice president, Menno Grouvel, also said that the long-term security of Russian energy supplies required stable energy sector development.

The country invests $15 billion each year to modernize and develop its energy sector, but needs to invest $40 billion in order to expand global energy supplies, Grouvel said.

He suggested that energy-importing countries help Russia come up with half of its energy sector modernization costs -- $20 billion per year -- since about 50 percent of Russia's hydrocarbon extraction is for export.

A staggering 90 percent of the world's gross domestic product is produced by countries that import energy, Khristenko said.

LUKoil's Alekperov noted that Russia had nearly four times the energy reserves controlled by the G7 nations, but said Russia's aging industrial infrastructure was threatening to make the country a petrol-products importer as early as 2009.

Only one modern oil-refining plant has been built in Russia since 1966, Alekperov said, calling for greater investment in the energy sector's oil-refining technology.

"Companies are ready to invest, but they come up against unstable tax legislation and political encumbrances," Alekperov said. As a result, potential investors, the state and all energy market participants lose out, he said.

TNK-BP president Robert Dudley reiterated Alekperov's call for clearer investment terms.

"The oil and gas industry is one of very long lead times," Dudley said on the sidelines of the conference. "All of the companies in the country need to start investing now, but to do that we need to have a clear investment framework."

Still, he commended Russia for putting energy security at the top of the agenda during its G8 presidency, saying it gave political and industry leaders the chance to sift through investment and regulatory issues, as well as to discuss concrete projects.

"It's no longer the case that energy security is only about supply disruptions," Dudley said.

Staff Writer Catherine Belton contributed to this report.