Illustrative Image
Written by Dhanuka Dickwella
Energy security is the key for a country’s sovereignty in the 21st century. When you are a political block as the European Union, energy plays an unrivaled role to its defense. The war in Ukraine has transitioned into a war between two distinct global systems. One led by the USA, NATO, EU – the collective west & the other led by the Russian Federation, China & the Global south. In this ever complex & dicey context , the one controlling the flow of energy seems to be the one writing the fate of the future world.
In retrospect to the G7 nations announcing a price cap for Russian oil, the Russian federation openly showed its willingness to dice with death. The Nord Stream 1 that connects the Russian gas fields with Germany by a pipeline running under the baltic Sea was stopped indefinitely. Europe is already in a perilous situation with an exorbitant gas price surge & a shortage. What does this mean for Europe & the rest of the world ? Is its energy security dead as a doornail ?
With a fluctuating demand the EU uses around an average of 394 billion cubic meters of gas an year. A staggering 45 % or 155 billion cubic meters of that comes from Russia. While countries such as Bosnia & Herzegovina , North Macedonia & Moldova depend 100 % on Russian gas the most troubling part is the German dependency. Germans source 55 % of their gas supply from Russia. Being the EU’s biggest economy & the industrial powerhouse that surely is a troubled sign for the whole union. The numbers reveal the stranglehold Russian Federation got on the EU & Germany in particular.
Russian gas is cheap, readily available & faster in getting through the pipelines. Gas from Russia is not a new discovery for the EU. From the Soviet times even as rivals , the EU has used gas produced in what was the former USSR. The dependency on one partner carries a huge risk outweighing the benefits of the sweet deals one can enjoy. This is exactly what is unraveling today.
With an immediate threat to heating & daily lives, the Gas shortages & the price increases could completely cripple economies. It works as a domino. With high gas prices comes high electricity prices which in turn affect the cost of production. That affects the profits forcing the industries to slash their production or completely go out of business if not suitable. That could cause a steep rise in unemployment. The cost of fertilizer has soared to record levels which has made the cost of food unbearably high. Inflation rises like a tidal wave that might engulf the entire European union. None of these are good news & especially bad for the less fortunate people or communities living in challenging economic conditions.
Europe needs a short term fix & a long term solution for this crisis. The news of storages reaching its optimal capacity before the schedule is indeed uplifting. But it does not mean they are out of woods.
The EU will not be able to source cheap gas from anywhere now. That is a fact they need to come to terms with. It has become a sellers market & every supplier will demand a pound of flesh. It is time to make a kill. Importing as much as LNG is an expensive but viable option. There are challenges to this method. First & foremost Europe does not have enough capacity in terms of LNG terminals & it takes time to build. Even if that can be sorted eventually there are only an x number of LNG carriers in the world which are already running at high capacities fulfilling promised contracts. Then the production. The production can not be done overnight & it is a process. Unless a guaranteed market is promised no producer is keen on increasing the production based on short term demand. That is exactly why Qatar & other LNG producers are demanding long term contracts. The long term contacts at fixed prices are bad news for the gas business model in Europe which uses the spot sales.
Another solution will be for alternative pipelines to that of the Russians. There are three such possibilities in discussion & planning . First would be the Trans Saharan Pipeline followed by the East Med Pipeline Line & finally the Trans Caspian pipeline. Lets have a very brief look into each.
The idea of the Trans Saharan Pipeline is to connect Nigeria, Niger & Algeria to Europe through Italy & Spain. This pipeline has the capacity to bring 30 billion cubic meters an year covering 10 % of EUs gas demands. This would be a significant boost. The challenges to this long proposed project are many. The region is a hot bed of conflicts & the divisions among the member states are high. This is bad news for any serious investor. Besides, part of Algeria’s already existing connection to the EU needs a complete overhaul & could question the viability of the project . Then the active presence of Russian PMC Wagner groups in these countries , speaks volumes about the Russian hold on the political theater of Nigher & Nigeria. Not to forget that Nigeria’s Nigaz is a joint venture between Gazprom Russia & Nigerian National Petroleum Corporation. The west kept ridiculing the political correctness of this name but now they have to worry more than its branding. So this pipeline is anything but promising.
East Med pipeline is bringing the Gas from Israel’s Levintan & Cyprus’s Aphrodite gas fields to Europe via Greece & Italy. The capacity is 12 billion cubic meters an year amounting to 4% of the Eu gas needs. Although this could be a small but a significant contribution there are major issues. For one thing Israel & Lebanon will have to overcome their overlapping claims for gas fields & sea borders as soon as possible. Then the field in Cyprus has to be developed. This will be one of the longest & deepest layered pipelines that might need 10 years for completion. Even if everything goes well then there is a stumbling block. Turkey with its Maritime Boundary Treaty with Libya has established an Exclusive economic zone that overlaps the claims of Cyprus. Under pressure from Turkey , the USA withdrew its political support from the project citing the economic viability of the pipeline. East med looks dead on arrival.
Trans Caspian – The third pipeline that would connect Turkmenistan , Kazakhstan & Azeribaiajni gas to Europe via Turkey has a potential capacity of 30 billion cubic meters a year counting to a 10% of the Eu gas needs. This volume is a greater number. Gas from Azerbaijan already flows to Europe via the southern gas corridor. This section will have to be upgraded to facilitate the new capacity. Could it go ahead though? According to the 2018 legal convection on the Caspian sea, Russia holds the final say to any new pipeline across this inland sea. When Putin has the final say we do not need to go further on even looking for more reasons. In addition to Russia , Iran is vehemently opposing this new pipeline.
As much as the difficulty of finding cheaper gas is a foregone reality , the EU has to agree with the fact that Russian gas could not be totally replaced under any realistic circumstances. But that is not the worst of all news.
The biggest challenge to the European Union’s energy security is none of the above. We only need to know who holds the biggest proven gas reserves of the world. The first , second & the third biggest gas reserves in the world goes to Russia, Iran & Qatar. They have a well structured organization that goes as GECF or “Gas Exporting Countries Forum”. This is a collection of 19 countries amounting to 71% of the entire global gas reserves. The ultimate objective of the forum is to form a cartel as OPEC to control the production, prices, transportation to the entirety of natural gas. Russia & Iran are 100 % onboard this while Qatar is having second thoughts with its relations with the west. But remembering its friends & foes during the Gulf states embargo on Qatar, I guess they would budge down eventually. Now imagine the power a cartel with a representation of 71% of the world’s proven reserves, an ongoing capacity of 42% of market production, 55% of LNG exports and 53% of pipeline trade cou;d wield across the globe. Natural gas will play the single most significant role in energy for the next 40 to 50 years until the world reaches its transition to renewable energy in full. For four decades to come , this kind of cartel could just sit on their respective capitals & control the whole world as they please. If GECF becomes what it aspires to be & realize its optimal potential , needless to say that the EU is doomed to lose in the great gas war both in the short term & in the long term. Pushed to the wall, it will be the moment of truth for 447.7 million Europeans. Time will tell.
Belgium bankrupt, euro worthless, gas severed until sanctions removed—germans in Stone Age yet Russia thrives—-poko molo nazi seeking new lgbt nebraska therapist, jens on triple anti depressants—-rames and Sawyer mural monkey pox sex
All of EU trash is bankrupt. Just watch the fun.
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Good to know!
As EU citizen, I would be really surprised if any oil and gas producer in the world will help the EU by jumping in the fire for it and not exploit the situation by asking as much money as they can get. Especially after the smug, arrogant attitude some european countries show to the rest of the world. Let the EU use Polish and Baltic and North European nonexistent gas, since it’s them who apparently call the shots in policy making. To everyone his own.
They still think they’re the superpowers like its 1860
Because they’re standing in the shadow of the US military
Euro-trash will freeze and collapse. Already public anger is building against the corrupt Bilderberg appointed puppet Zionist regimes. Russia now needs to switch off all gas for the winter and watch the riots in the streets. Russia also needs to take out the whole Ukrainian gas and power grid. European public hates the Uki parasites anyway, and when they freeze NATO lapdogs are truly Kaput. They will turn on the Americunt losers.
Is there an energy source capable to replace LNG?
Masturbation is the only hope!
Well, put it this way ‘A total of 173,000 terawatts (trillions of watts) of solar energy strikes the Earth continuously. That’s more than 10,000 times the world’s total energy use.’
The problem is we as a species are not clever enough as yet to know how to harness it efficiently, so the short answer is no.
Very well! Europe for many years received our natural gas for a pittance, not realizing that its entire economy is built on the very low price of Russian gas, at a time when we were starving in Soviet times. But on the other hand, they looked at us as second-rate people, hated us, and fought with us. And we freed them from fascism at the cost of our own blood. It’s time to realize the truth that without Russia they are nobody! Beggars!
gas prices up today after NS supplies cut—-EU cut forests like Stone Age…..saudi cut oil production—oil price up today……Russia reserve fund up 32 % since 1 march—100$ billion increase…those anglo morons expert failures
Russia isn’t doing this to Europe. Rothschild is.
Crash to the wall
Europe really thought they were the ones in charge lmfao
It’s not 1740, Russia isn’t some backwater full of peasants trying to play the great game anymore.
Russia controls half of the EU entire energy supply and they really thought they were in the position to dictate terms to Russia. Like Europe hasn’t been completely insignificant on the world stage since 1945
Thank you for providing gas at low prices to us for so long Russia, i get the problems with continuing it are the fault of the US UK EU maniacs.
Russia-China-India. Dollar dead. nobody takes dollars. No way to pay for anything. Checkmate Empire.