Nina Chestney

(Reuters.) European gas prices have risen due to Russia’s invasion of Ukraine, and fears of disruptions in supply.

Alexander Novak, Russian Deputy Prime Minister, stated earlier this week that Russia is fulfilling its gas supply obligations. However it was fully within its right to retaliate against Europe after Germany stopped certification for the Nord Stream 2 pipeline last month.

Two Russian soldiers arrived at eastern Ukraine’s gas compressor stations on Thursday. However, there was no immediate effect on flow.

HOW CONFIDENT IS EUROPE ABOUT RUSSIAN GASS?

About 40% of Europe’s gas imports come from Russia, most being transported via pipeline. Rystad Energy has estimated that between 150 and 190 billion cubic metres of Russian gas are supplied to Europe each year. This is in addition to the 52 billion cubic metres (bcm), which comes via Ukraine or other nearby routes.

Some pipelines run through Ukraine. Others take alternate routes like Yamal-Europe which traverses Belarus and Poland to Germany and Nord Stream 1 which runs beneath the Baltic Sea to Germany.

In recent years, most European countries have reduced their dependence on Russian gas. It was mostly used to transport gas to Slovakia, Austria, or Italy through the Ukraine transit route in 2021.

This week, President Joe Biden of the United States imposed an immediate ban upon Russian oil imports. Britain also stated that it will phase out these imports until 2022.

Others are also trying to get rid of Russian gas. EU officials have stated that they want to decrease Russian gas use by at least two-thirds in the current year, and get rid of Russian imports “well before 2030”.

WHERE ELSE CAN EUROPE GET SUPPLY FROM?

Although the international gas market has been tightened since the Ukraine crisis, there are alternatives for some countries. The European gas network can also be connected so that supplies can be shared.

Germany is Europe’s largest consumer of Russian gas. The Ukraine crisis has caused the certification process for Nord Stream 2 to be halted. Germany could now import Russian gas via pipelines from Britain, Denmark and Norway.

Equinor Norway has stated that it’s looking into ways to generate more gas from Norwegian fields for the summer of Europe. Maintenance is an usual factor in reducing output.

Southern Europe is able to receive Azeri Gas via Trans Adriatic Pipeline from Italy and Trans-Anatolian Natural Gas Pipeline through Turkey.

America, which has a large export market for liquefied natural gases (LNG), also tried to assist Europe by asking its LNG producers to increase their supplies.

This year, LNG imports into northwest Europe from both the United States and Canada have reached record levels.

Qatar, one the largest LNG producers on earth, said that it cannot replace Russian supplies to Europe. The bulk of volumes were tied to long term supply contracts.

Europe’s LNG terminals have limited capacity to import additional imports. However, some European countries claim they are exploring ways to increase imports and store.

Britain has indicated that it is open to all possibilities for increasing its energy supplies, despite being less dependent upon Russian gas than some of its European counterparts.

DO YOU HAVE OTHER COMES TO USE WITH THE GAS SUPPLY CRUNCH?

A number of countries might seek to make up any shortfall in their energy supplies through interconnections with neighboring states and/or by increasing the generation of nuclear, renewables, or coal power.

According to the European Commission, 60 billion cubic metres of Russian gas could be replaced by LNG or gas from other countries this year. Increased biomethane, hydrogen and other hydrocarbon use may also be beneficial by 2030.

The development of new wind and solar power projects can replace 20 billion cubic meters of annual gas demand. By doubling capacity in 2030 and adding 480GW wind energy and 420GW solar energy by 2030, 170 million could be saved annually.

Turning down thermostats by 1°C could save an extra 10 bcm this year, while by 2030, replacing gas boilers with 30 million heat pumps could save 35 bcm, the Commission added.

The availability of nuclear energy is declining in Belgium, Britain and France, as more plants age, are phased out or decommissioned.

Europe has tried to reduce its dependence on coal, however some plants are being reactivated since mid-2021 as a result of rising gas prices.

Germany said that it might extend the lifespan of its coal- and nuclear-powered plants in order to reduce dependence on Russian gas.

According to a head of a gas lobby, Germany’s domestic production could be increased at its northern fields.

In times of crisis, governments have tried to decrease industrial production, pay back-up generators for supply switching, or order homes to cut down on energy consumption.

The German state’s sole steelworks, Lech-Stahlwerke has been forced to cease production due to an unexpected rise in electricity costs.

Norwegian fertilizer-maker Yara has also reduced its ammonia, urea production in Italy and France.

HAS SUPPLYTO EUROPE BEFORE BEEN DISRUPTED?

In the last fifteen years, there have been many disputes between Russia/Ukraine over gas. These were mostly about prices.

Gazprom cut Ukraine’s supplies for one day in 2006. The winter 2008/2009 saw Russian supply interruptions that rippled throughout Europe. Russia cut supplies to Kyiv after Moscow annexed Crimea in 2014.

In November 2015, Ukraine stopped purchasing Russian gas and instead imports gas from EU nations.