I have written before on these pages on the role of energy in bringing about the recent Russian incursion into the Ukraine's Crimean region. But as the claws come out and sanctions are imposed by the West against President Vladimir Putin's government, energy may also hold the key to how the situation will develop.

The U.S., European Union, Australia and Canada have imposed sanctions against individual Russians and Ukrainians for their role in undermining the Ukraine's territorial integrity. But with sanctions to date described as "toothless," and pithy jokes made on all sides about their futility, the new European political order has come into sharp relief and caused concerns over the U.S.'s ongoing diplomatic leverage.

Many doubt that the tit-for-tat sanctions seen so far will expand to anything more meaningful, given the billions invested by Russian oligarchs and businesses in Europe, the heavy dependence of many Europeans and U.S. exposure to strategic Russian players such as Gazprom and Rosneft through joint ventures in Russian oil and gas fields.

But market sentiment suggests otherwise.

A call scheduled by a law firm to discuss the implications of the sanctions reportedly attracted more than 300 dial-ins. As U.S. President Barack Obama drafts more executive orders and Congress battles over the scope of further squeezes, talk is of who is to be targeted next. This is a tale in which the energy sector features prominently.

Western leaders have said that no further major sanctions will be imposed unless Russia makes more moves into Crimea, but Obama has already suggested publicly that energy would be the first target of the next round of broader trade sanctions he is pushing for.

So far the U.S. and E.U. have steered clear of Russia's "energy czars." Alexei Miller (CEO of Russian gas monopoly Gazprom) and Igor Sechin (CEO of oil giant Rosneft) were touted as prime candidates for sanctions but did not appear on the list. Only Gennady Timchenko, co-owner of independent oil producer Novatek, and a close ally of Putin, made the cut.

Direct sanctions against the Russian energy sector would doubtless be disastrous for Russia, a country where well over 50 percent of exports come from oil and gas. But heavy sanctions on Russia's oil and gas exports or companies could be equally suicidal for the energy security of European countries, which source 30 percent of their energy from Russia, a percentage that trends higher the farther east you go.

Russia has long been accused of using its vast oil and gas resources as a political weapon, but now it may be time for the U.S. to use its booming shale industry as some kind of armor — perhaps more akin to a shield.

U.S. shale is one of a handful of alternative sources of energy, including the multibillion Southern Corridor project, suggested to help wean Europe off Russian gas. That seems what Obama suggested in the Brussels meeting with E.U. officials last week.

In this scenario, U.S. gas would have to go through a costly liquefaction procedure before being transported by ship as LNG to European shores, where it would be gasified again before use (Spain has offered up some of its excess import capacity). But several obstacles lie along the way, suggesting that policymaker optimism on U.S. shale as some kind of savior may be misplaced.

To begin with, U.S. leaders must fend off the opposition of the domestic industry lobby to open up exports of U.S. gas internationally. In the words of one spokesman for the Canadian government, the debate around alternative imports from the U.S. or Canada is "charming, but currently remains theoretical, because they don't export any gas." However, there is talk of a transatlantic trade pact with the E.U., which would ease export licenses for U.S. gas producers.

If exports crossed the Atlantic, there are still serious doubts as to how ready European energy infrastructure is to switch to a different export strategy in the short term. Capacity has grown, and LNG has gone from representing 15 percent of European gas imports in 2010 to 25 percent in 2013. But that capacity unevenly distributed, gas hubs have liquidity problems and the system is still designed primarily around gas imported on long-term contracts via pipeline from Russia.

Expensive LNG import facilities cannot be thrown up overnight. Germany, arguably the strongest economy in the bloc, has increased its reliance on piped gas from Russia since it began its phase-out of nuclear power following the Fukushima disaster.

While Western European countries have greater LNG capacity through Spain and Italy, Europe may need to strengthen gas interconnections in Eastern European countries and the Balkans, and expand the facility to receive LNG in Greece.

Another aspect to consider is the opportunity cost of delivering gas to Europe for geopolitical motives rather than exporting gas to Asian markets, where regional gas prices are far higher.

The future of the Crimean conflict — and arguably the shifting global balance of power — depends on how threatened Putin feels by the prospect of a Western boycott of the Russian energy industry. But more importantly it depends on how far he believes the U.S. and the E.U. have the guts to go through with stronger measures.

This is rapidly turning into a game of nerve, with both sides using energy resources as a political tool for leverage in the diplomatic stand off, and Obama will have his work cut out convincing European leaders that a harder line against Russia won't leave their energy security in tatters.

On the one hand, the U.S. has long viewed European energy security as a matter of its own national interest. On the other hand, U.S. lawmakers insist on harsher sanctions against Russia in order to curb their forays into their borderlands.

Shale gas exports from the U.S. appear to offer a glimpse of reconciliation between these two priorities, but it is one clouded by doubts in the short term. Obama's success this week in persuading European policymakers to take what seems to be the reckless decision of supporting a harder U.S. line will be the greatest test yet of the shale revolution's much-hyped geopolitical clout.