BAKU, Azerbaijan, Sept.30. Severe gas demand destruction in Europe is necessary for getting through this winter, Trend reports with reference to Oxford Institute of Energy Studies (OIES).
OIES report reveals that the countries that are most impacted by reduced or no imports of pipeline gas from Russia are all in Central Europe – Germany, Czech Republic, Slovakia, Austria and Hungary.
“If flows from Russia were to halt completely, then this area would be reliant on a small amount of its own production and imports from Norway (into Germany), Belgium and the Netherlands. There is little or no prospect of any imports from southern Europe or from France. The Netherlands still has its own production from Groningen, although this is declining, and together with Belgium also imports from Norway, the UK and LNG,” said OIES.
The analysts of Oxford Institute note that for the coming 2022/23 winter, the available supply, including withdrawals from storage, looks to be short of the volume required to meet a cold January peak, without full imports from the UK, which are unlikely in a cold winter.
“For the winter as a whole, if it is cold, then the sub-region may just about get through by fully depleting storage, without any serious demand destruction. This would, however, depend on imports from Russia continuing at current rates of 80 mmcmd. This scenario, however, would mean starting the summer of 2023 with nothing in storage and much reduced capacity to fill storage through the summer.
The addition of substantial amounts of LNG import capacity in Germany especially, helps but some of the LNG seems likely to be diverted from the UK, with the UK exporting less. Even with Russian pipe imports, storage may only be 35 per cent full by the beginning of the 2023/24 winter. This suggests that getting through that winter would be impossible without severe gas demand destruction in the impacted countries. Lower, or no, Russian flows to the EU would be very problematic for this coming winter and catastrophic for the 2023/24 winter.”
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