Page 4 - FSUOGM Week 44 2022

FSUOGM COMMENTARY FSUOGM

IEA warns of major gas supply-

demand gap in Europe next year

Europe is prepared for this winter, but the next one may be a different matter

EUROPE IT now looks increasingly likely that Europe will filling storage sites this year benefitted from fac-
make it through this coming winter with suffi- tors that might not be repeated this year.
WHAT: cient gas supply. But the International Energy “These include Russian pipeline gas deliveries
The IEA warns that Agency (IEA) has warned of a 30-bcm sup- that, although they were cut sharply during 2022,
Europe could face a ply-demand gap next year in its latest analysis. were close to ‘normal’ levels for much of the first
30-bcm gas supply gap “Europe could face a gap of as much as 30 half of the year,” the IEA said. “Total pipeline
next year. bcm of natural gas during the key summer supply from Russia to the EU in 2022 is likely
period for refilling its gas storage sites in 2023 … to amount to around 60 bcm, but it is highly
WHY: highlighting the need for urgent action by gov- unlikely that Russia will deliver another 60 bcm
Governments need to act ernments to reduce gas consumption amid the of pipeline gas in 2023 – and Russian deliveries
urgently to reduce gas global energy crisis,” the Paris-based agency said to Europe could halt completely.”
consumption. in a report published on November 3. The IEA’s report also points to how much
Europe’s gas storage sites are currently filled LNG China will free up for the European market.
WHAT NEXT: to 95% of capacity, putting them five percent- Chinese LNG imports are set for a record decline
Factors that benefitted age points above the five-year average. But high this winter, amid an industrial slowdown, in
Europe in 2022 may not storage levels, the recent drop in gas prices and part caused by Beijijing’s draconian COVID-19
be repeated this year. unusually mild temperatures “should not lead to policy. But the agency notes that the country’s
overly optimistic conclusions about the future,” LNG imports could well recover to their 2021
the IEA said. level next year, which would capture 85% of the
The agency warned that Europe’s success in anticipated increase in global supply that year, or

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