STOCK MARKET UPDATE

Ticker

6/recent/ticker-posts

Gas wars: which EU countries will be most affected?

 

Russia has cut gas supplies to several European countries. While some countries in central and Eastern Europe face shortages, the poorest struggle with spiralling energy prices.

As Russia continues to reduce its gas supply to Europe, countries across the continent have begun implementing contingency plans that include reopening coal-fired power plants and extending the life of nuclear reactors.

After cutting gas supplies to several northern and east European countries earlier this year, Russia has now reduced gas deliveries to Germany via the Nord Stream 1 pipeline to a mere 20 percent of capacity. A turbine used to operate the pipeline and scheduled to be returned to Russian state-owned company Gazprom after maintenance in Canada has been stranded in Germany as the government claims Gazprom hasn’t provided the paperwork necessary to get it back. Russia, for its part, has blamed the stalemate on western sanctions.

At the end of July, European Union governments committed to cutting down on gas consumption by 15 percent by next March – a voluntary target aimed at showing a united front in the face of what EU officials see as energy blackmail from Russia over the bloc’s sanctions.  

The original European Commission proposal included a provision that would have enabled it to impose the targets as mandatory in case of an emergency. Instead, the move would now have to be approved by each country’s head of state, with the exception of Hungary – making it much more difficult to implement a real system of coordinated rationing.

We look at how EU countries have been affected so far, and the main challenges they will face ahead of winter.

Austria

Before Russia’s war in Ukraine began, Austria had been heavily dependent on Russian gas. Environment minister Leonore Gewessler said this week the country had successfully managed to reduce that dependence from 80 to 50 percent.

As Russian state-owned company Gazprom failed to provide gas to fill Austria’s storage capacity ahead of winter, the government allowed other companies to make use of it. 

Austria has also announced plans to run its Mellach power plant on coal this winter, after it had been converted into a gas facility in 2020.

Belgium

Belgium only relied on Russia for around 6 percent of its gas, and is instead a hub for supply to other countries in the European Union. 

The Belgian port of Zeebrugge is an important import centre for Liquefied Natural Gas (LNG). Much of it is supplied by Qatar.

Nevertheless, high gas prices have affected households and industry.

Bulgaria

In late April, Bulgaria was among the first EU countries to be cut off from Russian gas for refusing to pay for it in roubles.

Dependent on Russian gas by about 90 percent, Bulgaria stepped up LNG purchases, looking at suppliers including the United States.

It also expanded the capacity of a pipeline that runs from Azerbaijan's giant field in the Caspian Sea. 

Croatia

Croatia passed a law in June to enable the construction of an LNG terminal in an attempt to wean itself off Russian gas.

At just over 50 percent, Croatia’s gas storage levels were among the lowest in the EU in early August – a far cry from the EU’s overall target of at least 80 percent. 

Czechia

The country is almost 100 percent dependent on Russian gas, but most buyers purchase gas through foreign traders rather than directly from Gazprom.

A transit country, the Czechia connects northern Germany to southern Germany and Slovakia, from where the gas flows to Austria and Italy. Earlier this year, it reported a dip in gas transit, but importers said supplies remained stable.

Denmark 

Denmark was also cut off from Russian gas after Danish multinational Ørsted refused to pay in roubles.

The country pledged to quickly restart its Tyra gas field in a bid to become independent from Russian supplies, but that plan has been subject to delays of up to nine months, and is estimated to reopen in the final quarter of 2023 or the first quarter of 2024.

Pipes at the landfall facilities of the 'Nord Stream 1' gas pipeline in Lubmin, Germany.
Pipes at the landfall facilities of the 'Nord Stream 1' gas pipeline in Lubmin, Germany. (Hannibal Hanschke / Reuters)

Estonia, Latvia and Lithuania

Despite their dependence on Russian gas, the Baltic states announced they would stop all imports from Russia in April.

Russia provided gas to Latvia via both Estonia and Lithuania, while Estonia was the most dependent on Russian for its gas supply. 

Latvia, which was due to stop all imports from Russia in early 2023, was cut off from Russian gas in late July, citing the country’s breach of “terms for extraction of gas.”

Finland

Finland was cut off from Russian gas in May after refusing to comply with Gazprom’s request to pay in roubles. The move coincided with Helsinki’s push to join NATO.

Finland relies on Russian gas for only five percent of its energy needs.

France 

With about 17 percent of its supply coming from Russia, France is less dependent than other large European economies such as Germany and Italy. 

France has secured its gas storage from Qatar and other countries supplying via Norway. It signed an energy cooperation agreement with the United Arab Emirates and has announced plans to bump up nuclear power generation. However, those plans have been disrupted by recent heat waves, which have pushed up river temperatures.

Germany

Until the war in Ukraine started, Germany’s dependence on Russian gas had been a political choice. That dependence has now been reduced from 55 percent to a still high about 30 percent.

In early August, the country put a coal power plant back online as gas supplies from the Nord Stream 1 pipeline further dwindled.

The coal power plant, located in Lower Saxony, has received a temporary permission to operate until April 2023 to provide energy to at least half a million families.

German cities have cut back on lighting and hot water in an attempt to avert the worst scenarios for the winter.

Greece

Greece relies on Russia for 40 percent of its gas, two thirds of which is used for power generation. The country hasn’t experienced any disruption to its supply so far.

Greece has managed to replace a good amount of Russian gas by ramping up LNG imports, and plans to implement rotating power outages in case of a supply disruption.

Hungary

About 85 percent dependent on Russian gas, Hungary has been opposed to EU sanctions on gas imports from the country. 

Lagging behind in securing gas storage ahead of winter, Hungary expects to sign a new deal with Russia this summer for further supplies.

Ireland and Malta

The island countries do not rely heavily on Russian gas and are not connected to the continental European gas pipelines. Ireland, for instance, gets most of its gas from the North Sea.

Italy

Italy has cut much of its dependence on Russian gas from 40 percent at the beginning of the year to about 25 percent – which still exposes it to the Russian cutoff. 

The country has sought to strike a new deal to get gas from Algeria, and has ramped up on LNG imports. It also plans to get more from Azerbaijan. 

Luxembourg

The small central European state’s dependence on Russian gas was between five and ten percent of total consumption in 2020. It does not expect to have to implement cuts or a significant drop in GDP.

The Netherlands

The Netherlands has pursued agreements to buy more LNG to limit its dependence on Russian gas, while also running a campaign urging citizens to save power by, for instance, taking shorter showers.

Before the crisis, the government had planned to close a giant gas field in the north of the country, Groningen, due to local opposition over the environmental threats it posed, including earthquakes. The plan to permanently close the field has now been shelved.

Poland 

Alongside Bulgaria, Poland was the first EU country to be cut off from Russian gas back in April. As of early August, it had filled its storage capacity by nearly 100 percent. 

Most of Poland’s electricity needs are covered, controversially, by coal-fired power plants. It also has an LNG terminal in Świnoujście through which it has been importing gas from the US, Qatar, Egypt and Israel.

Portugal and Spain

Neither country in the Iberian peninsula counts on Russia for its gas, but both have suffered from a rise in the cost of LNG imports.

Romania

Romania turns to Russia in winter to cover around 20 percent of its gas needs, but has significant reserves both at sea and on land.

Earlier this year, the Romanian government passed a law to facilitate extraction in the Black Sea.

Despite being less vulnerable to a Russian gas cutoff than other countries, increased energy costs are posing a challenge to the country’s economy, while gas export facilities are still underdeveloped. 

Slovakia and Slovenia

The two countries rely on Russia to cover about 60 percent of their gas needs.

In Slovenia, the government has put in place measures aimed at energy savings of about 10 percent. Slovakia announced it will import gas from other suppliers, particularly Norway.

Sweden

Sweden, which has a common gas market with Denmark, is heavily reliant on Russian gas, but currently is well-stocked ahead of winter, with reserves 90 percent full.

Source: TRT World 


Social media is bold.


Social media is young.

Social media raises questions.

 Social media is not satisfied with an answer.

Social media looks at the big picture.

 Social media is interested in every detail.

social media is curious.

 Social media is free.

Social media is irreplaceable.

But never irrelevant.

Social media is you.

(With input from news agency language)

 If you like this story, share it with a friend!  


We are a non-profit organization. Help us financially to keep our journalism free from government and corporate pressure

Post a Comment

0 Comments

Custom Real-Time Chart Widget

'; (function() { var dsq = document.createElement('script'); dsq.type = 'text/javascript'; dsq.async = true; dsq.src = '//' + disqus_shortname + '.disqus.com/embed.js'; (document.getElementsByTagName('head')[0] || document.getElementsByTagName('body')[0]).appendChild(dsq); })();

market stocks NSC