Discover and read the best of Twitter Threads about #EU_Gas
Most recents (9)
#EU_Gas: In preparation for the coming winter, the EU must consider 3 main scenarios: 1) gas pipeline from Russia supplied through Ukraine and Turkey in the current pace; 2) the only pipeline supply is through the Turkishstream (Russia decides to stop the flow through Ukraine);⤵️ 
3) All pipeline gas supply from Russia is stopped. There are two structural variables that will influence the liquidity of the gas market: 1) reduction of internal energy consumption; 2) the access of LNG in the global market.⤵️
An intervening variable is the climatic condition that can impact the situation positively or negatively for security of supply.⤵️
#EU_Gas: It is very likely that a temporary cap will be established on the price of gas. The EU and member states reiterated the following: 1) The gas price cap is manageable and the market reacts to changes in the EU energy market (which send political signals to other⤵️
buyers and sellers). Still, Japan and others should join the initiative (China and India will not do this); 2) The gas price for electricity production will be regulated (Spanish and Portuguese models); 3) The price of LNG will be influenced through a new index that⤵️
will reduce the price in the longer term. The EU and member states will present more detailed decisions later today. Bad news for Russia's efforts to weaponize gas leverage.
#EU_Gas: The German chancellor acknowledged that Germany is free from gas dependency on Russian gas. Some important additional points: 1) Germany aims to reduce gas consumption by 20%; 2) the gas price cap could be in force only if other G7 countries (Japan and others) and ⤵️
South Korea joined avoiding competition for available gas. The EU states are importing more from Norway, Algeria and Azerbaijan; 3) The way out of the energy crisis is possible with the unused funds of the post-pandemic recovery (€600 billion); ⤵️
4) Russian gas constitutes 7% of European imports and the gas arrives through Ukraine (Sudzha point) and Turkish Stream (80 million m3 per day).
#EU_Gas: The Dutch authorities restored the export license to South Stream Transport BV (with offices in the Netherlands and Russia) which operates the “Turkish Stream” gas pipeline in the Black Sea (max. 41.7 million m3/day/31.5 billion m3 per year). In mid-September,⤵️
before the EU adopted the eighth package of sanctions, the Netherlands suspended the license of this Russian-linked company. The decision to allow the export through Turkish Stream on the EU market seems to be related to the decrease in⤵️
the supply of Russian gas through the previous routes. Putin recently declared that Turkey could become the "gas hub", which is a strategic goal of Erdogan.
#EU_Gas: The suspicion that NS1 was deliberately targeted to cause leaks and require repairs is becoming more convincing. Two scenarios: 1) Russia is rendering NS1 useless from a technical point of view to eliminate political criticism that Russia is waging gas warfare. This⤵️
plays an important role in Russia's ongoing "gas diplomacy" that seeks to redirect or diversify gas supplies to Asia outside the EU; 2) If Russia is behind these incidents and NS1 cannot be used at the moment, then Putin wants to advocate other routes👇
(NS2 - that has been cancelled by Germany & run technical issues as well) or cause an impact on the gas market which has now stabilized at ~1700 Euros per 1000/m3 (TTF, ~ 188MWh). Russia seeks to the money from gas but even more it wants to cause the "energy winter" in Europe.
#EU_Gas: Germany is set to negotiate long-term contracts with the UAE & Qatar on the supply of hydrogen and LNG. The “energy diplomacy” in action. Chancellor Scholz is traveling to the Middle East, accompanied by the big German companies, including the utilities Uniper & RWE.⤵️
The main question is the price and timing of delivery: signing long-term contracts now does not mean that the gas will flow the next day. Qatar can export from 2025. This could mean that the contract signed now will reflect the reality of the market in 2025,⤵️
when the price of gas should stabilize. Germany’s Scholz in Saudi Arabia as Gas Crunch Bites Economy bloomberg.com/news/articles/…
#EU_Gas: The Azeri Ministry of Energy, Shahbazov, announced that his country will increase its gas export to the EU by 40% already in 2022 (up to 11.5 billion m3). This involves the Trans-Adriatic gas pipeline, which is a section of the Southern Gas Corridor. The intention is⤵️
to increase the transport capacity up to 20 billion m3 in the next 5 years, with investment (probably expected to come from Western energy companies that left Russia as an option). The Azeri side insists that it seeks to increase the energy security of the EU by 2027. In my⤵️
opinion, in addition to mutual economic interests, Baku/Aliyev is interested in creating a stronger interdependence in the energy field with the EU (through the memorandum signed by @vonderleyen who called Azerbaijan a trustworthy partner). This will have implications on how⤵️
#EU_Gas: The price fell by 50% compared to August. Now the price on the European spot market is below €1,900 per 1,000 m3. This will surely stabilize the market and reduce inflationary pressure. However, in the short and medium term, this does not solve the structural⤵️
problems of the larger EU economies that were running on cheap gas. Moreover, further spikes in price are still possible due to continued gas shortage as LNG production comes from long-term contracts and production capacities. Therefore, LNG imports cannot completely replace⤵️
Russia's gas pipeline in subsequent years. The EU still relies on the Norwegian gas pipeline which now imports more than Russia, mainly because Russian gas stopped flowing through NS1 and other routes (except for part of the pipeline that crosses Ukraine).⤵️
#EU_Gas: Germany is prepared to sign long-term gas contracts to import LNG from the US and others (Middle East). Bulgaria agreed to buy 1 billion m3 from Azerbaijan through the interconnection with Greece, functional since October, with a future increase in imports via⤵️
the Southern Corridor. EU governments and companies are diversifying their gas imports away from Russia. In the short term, this helps ensure the certainty of security of supply. However, it is premature to say that EU countries will no longer buy Russian gas.⤵️
In the post-war time, Gazprom's offer can always drive down prices on the European spot market. Industries are looking for a competitive advantage and may be eager to return to old business as usual.⤵️
