I knew I'd find something on the subject of sending NatGas to Europe sooner or later.
But the war and the reduction of energy exports from Russia has turned Europe into a rather desperate buyer of LNG. Valery Chow of Wood Mackenzie told Reuters “In contrast [to Asia], European LNG demand is expected to spike up by at least 20% in 2022, reflecting reduced Russian pipeline flows and the need to replenish depleted European gas storage levels.”
Prices for both natural gas and electricity have hit all-time highs in Europe, which led the European Union to roll out plans to cut dependency on Russian gas by two-thirds this year, and to end its reliance on Russian supplies of the fuel by the end of the decade.
Europe’s largest economy, Germany, vowed to all but wean itself off Russian gas by mid-2024. And it’s easy to see why.
The latest problem involves Russia now demanding payment for its gas in rubles. So, Germany and Austria have put plans in place to possibly to ration supplies of natural gas if supply is cut off.
Europe, which relies on Russia for 45% of its gas supplies—155 billion cubic meters—will need LNG from a number of sources, including the United States.
And indeed, the U.S. is finalizing a plan to supply the EU with up to an additional 15 billion cubic meters (cm) of liquefied natural gas by the end of 2022. This number could rise to 50 billion cubic meters within a few years.
