As Europe is suffering from the sweltering heat and is trying its best to store gas for this winter, Russia has cut itsnatural gassupply to Europe sharply, leading to an aggravated “gas shortage” in Europe.Natural gasprices have soared, and the European inflation rate, which has repeatedly hit record highs, is under pressure again.The industry is worried that it will be difficult for Europe to find a suitable gas source in the short term. Even restarting coal power will be a drop in the bucket, and the European economy will face the risk of shrinking.
Russia's "first move is stronger"
Earlier in June,Gazprom(Gazprom) cut the supply of natural gas to Germany via the Nord Stream-1 pipeline by nearly 60%, citing technical reasons, weighing on European markets.The Beixi Natural Gas Pipeline Company recently issued a notice saying that from July 11 to 21, the two branch lines of the "Beixi-1" natural gas pipeline operated by the company will be temporarily closed for routine maintenance.Analysts pointed out that the move will exacerbate the recent shortage of natural gas in the European market.
Since the outbreak of the Ukraine crisis, the EU has imposed multiple rounds of sanctions on Russia, and it is urgent to get rid of its dependence on Russia's energy supply.The European Union announced in April that it would stop importing Russian coal in August.In June, the EU approved a partial oil embargo against Russia.But the EU is unlikely to impose new sanctions on Russia over natural gas this year due to mounting internal opposition.
As a countermeasure, Russia's "Ruble Settlement Order" with "unfriendly" countries and regions took effect on April 1.At present, Gazprom has successively announced the suspension of gas supply to European countries such as Poland, Bulgaria, Finland, the Netherlands and Denmark that have defaulted on natural gas payments and refused to settle in rubles.The head of the International Energy Agency, Fatih Birol, has warned that Russia may cut off gas supplies to Europe entirely, and Europe needs to prepare now.
The EU originally planned to increase the proportion of natural gas inventories to 90% by the end of this year to cope with the "gas shortage" in the future. Currently, countries are scrambling to store gas, and the average gas storage has exceeded 50%.Russia chose to start with natural gas supply at this time, and immediately made the EU passive. At that time, small and medium-sized enterprises and severely affected families could face a lot of pressure on whether they could survive the winter.
EU rushes to deal with 'gas shortage'
In order to achieve "open source", the EU is vigorously looking for alternative energy suppliers.Recently, the EU has repeatedly sought help from Israel, Egypt and other countries to obtain more natural gas supplies.However, observers pointed out that if the EU wants to significantly increase natural gas imports from Israel, it needs to face problems such as high cost and long construction period.
Several EU member states have opted to temporarily switch to coal in response to dwindling supplies of Russian gas amid a tight gas market and soaring prices.There are concerns in the EU that Russia may continue to cut supplies or stop them altogether as winter approaches.
In response to gas shortages, the International Energy Agency said Europe must improve energy efficiency and use renewable energy sources, including nuclear, to provide respite from high electricity prices and tight supplies while looking for alternative energy sources.The agency said recently that it expects investment in the global energy sector to reach $2.4 trillion this year, but it will not be enough to fill the supply gap and tackle climate change.
Professor Liu Yijun, a natural gas expert from China University of Petroleum, told reporters that Russia has greatly reduced its gas supply to Europe, and Europe has decided to significantly reduce its energy dependence on Russia. The natural gas gap will be huge, and the restart of coal power and the search for new gas sources cannot make up for the gap in the short term. , thereby exacerbating the "gas shortage" crisis.
High inflation increases recession risk
Analysts believe that the EU's dependence on Russian energy has made the EU "backlashed" by sanctions.Energy prices in EU countries have risen sharply, driving up prices in various industries, and inflation in some countries has hit a new high in decades.European benchmark natural gas futures prices have risen nearly 50 percent since Nord Stream-1 was cut.
In order to prevent further deterioration of the inflation situation, the European Central Bank had to start preparing for the first interest rate hike in more than 10 years, and plans to raise interest rates by 25 basis points in July.The market is worried that as the European Central Bank ends bond purchases, the financing costs of heavily indebted euro zone countries will rise sharply, bringing the risk of debt crisis and economic recession.
The European Commission's economic outlook report recently released predicts that the EU's economy will grow by 2.7% and 2.3% this year and next, which is lower than the 4% and 2.8% predicted in the February outlook report.The European Central Bank has warned that the euro zone economy will contract by 1.7% next year if Russia shuts down gas pipelines entirely.
(Reporter Chen Wenxian, Xinhua News Agency, Valletta, July 3)
"Guangming Daily" (12th edition on July 4, 2022)
