Introduction to Europe’s Energy Situation
Brrrrr! The autumn chill sneaks up in large parts of Europe and indicates the deep freezing this winter. Fortunately, the gas infrastructure in Europe, the gas operator association, reports that the gas reserves of the European Union are a little more than 80% – lower than the 90% pillow of recent years, but stronger than 2021.
Current Gas Reserves and Diversified Energy Supply
The EU countries with a diversified energy supply from Russia, according to Moscow’s invasion in Ukraine in 2022, have floated from the liquefied natural gas (LNG) from Norway, the United States, and Qatar, and continued to increase the introduction of renewable energies, including solar and wind. In the past two years, thanks to this additional capacity, Europe has been able to ensure that its gas reserves were almost full by September and provided an additional pillow for the coldest months of the year. Gas stocks should remain robust this winter too.
Gas Refill Racing Considered Less Critical
Since the EU is no longer in an acute energy crisis, Brussels is flexible to give EU gas stocks an additional month by December 1st to achieve a capacity of 90% if necessary. Europe has also used more gas reserves last winter and less excess than usual. Petras Katinas, Energy Analyst, says that the current storage and alternative deliveries provide a "solid buffer" against care disorders. However, fast withdrawals and volatility of the weather can still cause temporary price tips or localized bottlenecks.
Global Energy Supply and Demand
The supplement to the internal resilience of Europe, the global conditions of offer, and the stable prices also support the blockage of the block for winter. According to Tom Marzec, global energy supply has risen this year, while the demand – especially for gas – is likely to be weaker. This was a real advantage for the refilling of Europe’s storage units this summer, which will continue with a nice clip.
Russia-Energiezölle Create New Uncertainty
Trump pushes Brussels to sank to buyers of Russian energy, and argues that Moscow was earned additional financial burden to end the three and a half year conflict. Last week, the US Minister of Finance announced that they should impose "meaningful" tariffs in China and India about their energy transactions with Moscow with Washington. Trump announced Brussels that the United States would "reflect" such tariffs, with a rate of 100% taking into account.
The Ukraine Gastransit Had Only Limited Effects
The course of the Ukraine Russia’s gastransit on January 1 was another layer of the geopolitical pressure on the energy supply of Europe. Kyiv’s decision not to extend the deal also aimed at reducing a source of income that helps to finance Russia’s war effort. The five-year agreement, which it was able to flow to Russian gas via Ukrainian pipelines, effectively concluded one of the last important routes into the EU.
2-Year Goal for the Energy Independence of Russia
After the EU has driven the energy crisis, it is now in a stronger position to diversify the last of its deliveries of Russian hydrocarbons. The block has already reduced Russian gas imports from 45% to 19%, while Russian oil imports have shrunk from 27% to only 3% at the beginning of the war. In May, the Commission published a detailed roadmap by 2027 to completely ban all remaining imports of Russian gas and liquefied natural gas.
Progress Towards Energy Independence
The Baltics did an excellent job to move away from Russian fossil fuels, while Poland has largely set Russian gas. However, progress was "uneven" in other Visegrad countries due to a lack of diversification efforts and investments in renewable energies. The strong gas stocks and different EU supply lines strengthen the block of winter, but Trump’s tariff and unpredictable weather cloud the horizon. The natural gas prices will probably not increase at almost € 340/MWh ($ 400), but insulated bottlenecks could trigger temporary spikes.
