Is Europe getting complacent? [Gas in Transition]
Is Europe getting complacent? [Gas in Transition]
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Natural Gas News
Is Europe getting complacent? [Gas in Transition]
Summary
With no end in sight of the Russia-Ukraine war, global energy markets will continue to be unstable, making 2023 another difficult year for global energy. Last year’s energy challenges could be repeated next winter and probably the next. Europe is not out of the woods yet. As EU energy commissioner Kadri Simson said, Europe has come a long way, but it still has a tough job ahead of it. [Gas in Transition, Volume 3, Issue 4] by: Thierry Bros
Following the declaration by European energy commissioner Kadri Simson at the end of February that the gas battle has been won, Europe has descended into a period of optimism. The winter is over and the risk of disruption in the supply of natural gas is over, for now. EU gas storages are exiting winter over 56% full by the end of March – the best position they have been since 2018 (see figure 1). As a result of this and plentiful supplies of gas and LNG, prices have fallen from their peak last August, at over €340 ($373)/MWh, to under €45/MWh by mid-April (see figure 2). To be fair, Simson went on to say “The test is not over. We have just won the first battle and there is still a long fight ahead of us.” She added that to further strengthen its hand, the EU needs to work on diversifying its energy supply, deploying more renewables, reducing energy demand and ensuring it has sufficient gas in storage to get through next winter. Undeniably, though, the EU made it through the winter without suffering supply disruptions, despite the reduction in Russian gas exports to Europe – a major achievement. A combination of mild weather – Europe had the second warmest winter on record – demand reduction because of the very high prices and the economic slump and timely policy actions led to a 55bn m3, or 13%, reduction in gas consumption in 2022. Record additions of wind and solar power also helped...
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Natural Gas & LNG News, Europe, Insights, Premium, Gas In Transition Articles, Vol 3, Issue 4