Tensions between Russia and Ukraine have heightened concerns about Russian gas flows, prompting the United States to assure European allies it will help them find alternative supplies.
The U.S. administration has approached Qatar and other major energy producers to see if they can help should Russia attack Ukraine and the United States impose sanctions on Russia.
Russian gas flows to Europe have been lower than usual for several months already. European politicians say Russia is using high gas prices as leverage in a dispute over the Gazprom-backed Nord Stream 2 pipeline project.
Gazprom says it is meeting commitments to European customers.
WHERE ELSE CAN EUROPE GET SUPPLY FROM?
Europe relies on Russia for around 35% of its natural gas. Most comes through pipelines including Yamal-Europe, which crosses Belarus and Poland to Germany, Nord Stream 1, which goes directly to Germany, and via Ukraine.
Europe’s gas markets are linked by a network of pipelines. Most countries have cut reliance on Russian gas over the years and there are also more supply routes that bypass Ukraine.
The Center for Strategic and International Studies (CSIS) said Ukrainian transit of Russian gas has been reduced by 70%, from over 140 billion cubic meters (bcm) in 1998 to less than 42 bcm in 2021.
By last year Ukraine was a transit corridor largely for gas going into Slovakia, from where it continued to Austria and Italy, the CSIS added.
But sanctions on Russia could impact flows through other pipelines such as Yamal-Europe, Nord Stream 1 and TurkStream. Nord Stream 2 is awaiting certification before Russian gas can flow through to Germany.
U.S. State Department spokesperson Ned Price said on Wednesday that Nord Stream 2 will not move forward if Russia invades Ukraine.
“It would be difficult for Europe to stomach sanctions which effectively cut off Russian gas supply, or at least a large portion of these flows,” said analysts at ING.
Some countries have other options. For example, Germany, the biggest consumer of Russian gas, can also import from Norway, the Netherlands, Britain and Denmark via pipelines.
But Norway, Europe’s second largest supplier, is delivering natural gas at maximum capacity and can’t replace any missing supplies from Russia, its prime minister said.
Southern Europe can receive Azeri gas via the Trans Adriatic Pipeline to Italy and the Trans-Anatolian Natural Gas Pipeline (TANAP) through Turkey.
Neighbouring countries can transfer gas via interconnectors but nations may be unwilling to part with gas they might need and importers would have to pay a high price.
On top of all this, European gas storage levels are very low for winter, when demand is traditionally highest.
“Cushion gas” held in underground storage to maintain pressure levels could theoretically be used in emergencies, analysts say.
Longer term, the European Commission has proposed a system for EU countries to jointly buy strategic stocks of gas.
Liquefied natural gas (LNG) imports to north-west Europe, particularly from the United States, have climbed this month as the price of Dutch gas, the European benchmark, is higher than its Asian LNG counterpart.
But there is a limit to how much LNG suppliers can produce and transport. Global liquefaction capacity is almost fully utilized and so are LNG vessels, think tank Bruegel said on Thursday.
Qatar, one of the world’s top LNG producers, could send some additional gas to Europe but spare supply is scant as most volumes are under contract, a source told Reuters this week.
“Assuming average temperatures, high LNG imports would prevent the most severe physical shortages before the end of this winter – localised shortages are possible, due to infrastructure limitations,” Bruegel said.
Several nations have options to fill the gap, including power imports via interconnectors from neighbours, or increased power generation from nuclear, renewables, hydropower or coal.
But nuclear availability is declining in Germany, Britain, Belgium and France due to ageing plants, decommissioning, phase-outs and frequent outages.
Under pressure to meet climate targets, several EU countries have shut down old coal-fired power plants or are not building new ones.
Some countries retain coal plants for use for back-up supply but many have already been fired up due to high gas prices.
In past crises, countries have introduced measures to reduce industrial production at certain times, pay back-up generators to switch on supply, order households to curtail energy use, or enforce temporary power cuts.
HAS SUPPLY TO EUROPE BEEN DISRUPTED BEFORE?
The past 15 years have seen several disputes between Russia and Ukraine over gas, mostly to do with prices paid.
In 2006, Gazprom cut off supplies to Ukraine for one day. In the winter of 2008-9, disruptions to Russian supply rippled across Europe.
In 2014, Russia cut off supplies to Kyiv after annexing Crimea. Ukraine stopped buying Russian gas in November 2015.
Ukraine has reduced reliance on direct gas imports from Russia via a reverse flow mechanism, allowing Ukraine to import from EU countries.
(Reporting by Nina Chestney, Nerijus Adomaitis, Nora Buli, Vladimir Soldatkin, Stephen Jewkes, Kate Abnett, Jan Lopatka and Luiza Ilie; Editing by Catherine Evans)
Photo – Flags wave outside of the Russian Gazprom company’s headquarters in Moscow, Russia. EPA-EFE/MAXIM SHIPENKOV