Biden went on a “gas attack” on Europe: we will warm with our own fuel

The United States is making loud statements about overthrowing Russia’s monopoly

Washington has given guarantees to EU countries on additional supplies of American liquefied natural gas (LNG), which will gradually replace Russian fuel in the Old World market. US President Joe Biden and European Commission President Ursula von der Leyen have signed an agreement aimed at reducing dependence on gas from our country. According to experts, it will take several years for Europe to abandon Russia’s energy resources, but even now American companies can, if not completely replace it, noticeably squeeze Gazprom in the continent’s fuel market.

The main goals of the working group to be set up by the United States and the European Union will be to diversify LNG supplies and reduce demand for gas in general. Washington has announced an increase in blue fuel supplies, and the European Commission has promised to work with union members to diversify energy purchases to meet annual demand for an additional 50 billion cubic meters of US liquefied raw materials in eight to ten years.

How the Europeans will carry out this task is not yet clear. The United States promises to increase its LNG shipments to the EU by 15 billion to 37 billion cubic meters this year. But Russia’s pipeline fuel exports to Europe are about 155 billion cubic meters annually. Moreover, now our raw materials are exported at full capacity and transit through Ukraine is at the maximum of Gazprom’s contractual obligations. In addition, according to experts from the British The Guardian, additional supplies of US LNG to Europe extend the period of abandonment of fossil fuels for years, “as they increase dependence on risky volatile fuels and lead to disaster for our climate and congested Persian Gulf communities.”

However, already now the raw material potential of the States allows them, if not completely replace, then significantly squeeze Russia in the European fuel market. According to Vadim Ponkratov, director of the financial policy center at the Russian government’s Financial University, Washington has the resources to increase LNG shipments overseas even more. A new Calcasieu Pass LNG liquefaction plant was launched in Louisiana in December, and a sixth line was put into operation at the Sabine Pass plant in the same state. Therefore, in general, existing assets allow the United States to increase LNG exports in 2022 from 60 billion to 70 billion, and by the end of 2023 to bring capacity to 75 billion cubic meters. However, in order to reorient supplies to Europe, Americans will have to give up trade obligations to Asian countries, which are currently purchasing a significant portion of US LNG contracted under medium- and long-term agreements.

Another question arises – will European terminals be able to accept and process increased volumes of liquefied fuel for uninterrupted supply of domestic customers? Loading all European LNG terminals at full capacity will allow them to develop up to 150 billion cubic meters of gas per year, which is comparable to Russian supplies. However, 85 billion cubic meters should be deleted from this figure, as this is the current EU liquefied fuel market. Washington has proposed building a gas pipeline from Spain, where many American LNG is stored, to France. However, the implementation of such a project from scratch will require significant investment and a long time to implement. Even the construction of less expensive new terminals in Europe, according to experts in The New York Times, will take two to five years, so “Biden’s plans to significantly increase supplies of US LNG to the European Union are symbolic.”

In light of the possible abandonment of Russian gas, the countries of the continent are preparing for austerity. As one of the measures aimed at covering the deficit due to possible interruptions in the supply of hydrocarbons, the European Commission may introduce a minimum level of filling of underground storage facilities. According to the new rules, by the beginning of the upcoming heating season, that is, by November 1, they must contain at least 80% of the available gas volumes, and in subsequent years – 90%. Until recently, European UGSs were almost completely depleted, with stocks three or even four times behind.

Achieving such figures without Russian fuel, even with all the efforts of American manufacturers, will be extremely difficult for Europe. Authorities in Spain and Portugal have already begun discussing the introduction of a single maximum electricity price in the EU, and possibly switching to limited-slip fuel shipments. “The structure of Europe’s refusal of energy resources from our country has not yet been clearly formulated,” said Sergei Pikin, director of the Energy Development Fund. – In particular, the possibility of creating a single buyer of gas, which could conclude deals with Russia to circumvent sanctions, which indicates the desire of the continent to continue to use our hydrocarbons. “Gazprom can only look for new buyers who could in the future master the raw materials rejected by the European Union.”

.

About the author

lpnaf

Leave a Comment