Low natural gas deliveries from Russia appear to have artificially tightened the European gas market, the International Energy Agency’s Executive Director Fatih Birol said on Thursday, adding that energy systems “face significant risks” by relying too much one on supplier for a key energy source.
“We see strong elements of ‘artificial tightness’ in European gas markets, which appears to be due to the behaviour of Russia’s state-controlled gas supplier,” Birol wrote in a LinkedIn post in one of the strongest finger-pointing in recent months about who is responsible for the record-high natural gas prices in Europe and skyrocketing energy bills for households.
Unlike other pipeline suppliers to Europe—including Algeria, Azerbaijan, and Norway—Russia actually cut its exports to Europe by 25 percent in the last quarter of 2021 compared to the same period of 2020, and by 22 percent versus the fourth quarter of 2019, he added.
“And this is despite the exceptionally high market prices for natural gas that we have seen in recent months,” Birol wrote.
According to estimates from the IEA, Russia could raise its gas deliveries to Europe by at least one-third, or over 3 billion cubic meters per month, which would be nearly 10 percent of the European Union’s average monthly gas consumption, the head of the agency said.
“In my view, today’s situation underlines the fact that energy systems face significant risks if they rely too much on one supplier for a key element. Today, it is natural gas; tomorrow, it could be something else, such as lithium. This is why I’m urging governments to act now to tackle today’s energy security challenges and those of the future,” Birol wrote.
Meanwhile, the EU’s Competition Commissioner, Margrethe Vestager, said on Thursday that she was “eagerly awaiting” Gazprom’s response to EU questions about insufficient deliveries.
Low Russian supply and cold weather have been the two main drivers of rising gas prices in Europe in recent weeks when Russia’s deliveries via Poland and Ukraine have been lower than historical norms.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews. More
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