The IEA estimated that the EU gas deficit in 2023 could be as high as 57 billion cubic meters.
triggered by Russian energy export cuts amid Moscow’s war in Ukraine have subsided thanks to good luck, good weather, and quick action.
“If pipeline imports to the European Union from Russia drop to zero in 2023 and Chinese LNG demand rebounds to 2021 levels, then the European Union faces a serious supply-demand gap opening up in 2023,” the International Energy Agency said in a December 12“In the short run, Europe is in a difficult predicament,” Agathe Demarais, the global forecasting director at the Economist Intelligence Unit, wrote in Politico in November, adding thatThe IEA estimated that the EU gas deficit in 2023 could be...
Russian natural gas exports to the EU via pipeline are forecast to fall to about 60 bcm this year compared with 140 bcm last year and nearly 200 bcm in the pre-Covid year of 2019. She said Russian exports via Turkey should continue unless the Kremlin determines that a complete shutdown of pipeline gas to the EU is politically and militarily expedient.Chris Weafer, a Russia energy expert at the Moscow-based Macro Advisory, said he doesn’t expect Russia to cut gas volumes to Europe any further because it needs the cash and can’t sell the pipeline gas to other markets due to a lack of infrastructure.
Russia “will need at least current gas export volumes because it will need to try and keep the budget deficit as low as possible,” Weafer told RFE/RL.Europe and Russia “have managed to reduce gas dependency on the other this year but volumes are now down to critical levels,” Weafer said. “Neither can afford for gas volumes from Russia to Europe to drop any further in 2023, and probably also 2024.”
However, surging energy prices did cause about 10 bcm of industrial demand destruction, the IEA said.To offset the drop in Russian pipeline gas, the EU imported about 50 bcm more of LNG in 2022. That would have been a lot harder to do had China not locked down its economy to combat COVID. Norway, Azerbaijan, and the countries of North Africa -- key exporters of pipeline gas to the EU -- are already operating at or near capacity, he said. And the United States and Qatar won’t launch major new LNG export projects for another two years.
The lower the gas storage levels are come spring, the more fuel the EU will have to purchase in a supply-constrained market to prepare for the winter of 2023-24, he said. It’s a momentous change that could hardly have been predicted before Putin launched the large-scale invasion of Ukraine on February 24, even after years of tension between Moscow and the West.
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