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IEA warns Europe of record gas shortages in 2023 due to Russia and China

November 4, 2022
in Daily News
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The International Energy Agency (IEA) is warning European countries of record gas shortages that the continent will face in 2023 and is urging EU authorities to start taking action now. The IEA also notes that the success of the winter of 2023-2024 depends not only on the EU, but also on China, the demand for energy within which may affect the volume of supplies to the EU. The agency published the relevant findings in its report.

IEA Executive Director Fatih Birol notes that the positive dynamics of gas injection in storage facilities in 2022, as well as a significant reduction in energy consumption, coupled with warm weather, somewhat relaxed some European countries and politicians. Although 2023 will be much more difficult in terms of passing and preparing for the heating season, he is sure.

“We see that in different parts of Europe there is a risk of complacency in the course of the debate. Europe must take immediate action to avoid the risk of natural gas shortages next year,” Birol said.

The IEA estimates the gas shortage next year for the European market at about 30 billion cubic meters. This figure is formed on the assumption that Russian gas supplies are reset to zero, and fuel demand in China begins to recover from covid restrictions. The agency urges the European Union not to stop at the achieved local successes and continue to try to reduce gas consumption by increasing the energy efficiency of industries and households.

The decrease in gas from Russia in 2023 is expected to be about 60 billion cubic meters. If in 2022 Russia continued to supply gas until about mid-summer in the usual volumes, then 2023 will begin for Europe with the task of promptly searching for alternatives to Russia in order to replace the already record gas shortage in the market, the IEA notes. The recovery of the Chinese economy could significantly increase the demand for liquefied natural gas (LNG): in 2023, China could claim about 85% of new gas supplies.

The IEA warns the EU that with a reduction in gas supplies from Russia and LNG, Europe will only be able to fill its gas storage facilities by 65% ​​by the next heating season. And this is even taking into account the reduction in consumption within the block by 11% and the preservation of 30% of gas reserves in storage facilities following the results of the coming winter. The head of the IEA, Fatih Birol, intends to hold talks with European leaders to warn them of upcoming problems and call for their prompt solution. The IEA, for its part, is ready to provide the EU with a roadmap of specific measures, which include accelerated investment in energy efficiency and renewable energy sources, as well as the use of nuclear power plants to overcome the consequences of the energy crisis.

The European Union has previously announced an increase in investments in green energy in order to accelerate the energy transition and significantly reduce dependence on traditional energy resources. In the context of the energy crisis, Europe intends to divide the market into "green" and traditional, where pricing will be set differently. These measures should increase investment in green energy and accelerate the phase-out of oil and gas.

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