the wholesale price of gas in Europe increased by 19% against the background of the start of planned repairs of gas fields in Norway. The price increase should also be supported by the news of a fire at the Freeport LNG plant with a capacity of 15 million tons per year.
TTF futures on the ICE Futures exchange rose to $1,021 per thousand cubic meters after $855 at Wednesday’s close.
According to the Norwegian gas transmission operator Gassco, on June 8, the annual prevention of the Visund and Heimdall fields stopped, and on June 9, larger fields – Troll and Kallsen’s (this is already 82 million cubic meters) stood up. At the moment, the total disposal of production capacity is 104 million cubic meters per day.
The work of Freeport LNG has been stopped for at least four weeks due to a fire that occurred on Wednesday.
Thus, the energy crisis in Europe began at the end of August 2021.
The reasons were the low level of storage capacity, increased demand for raw materials in Asia and a decrease in energy at European wind farms, which caused the price of fuel to rise sharply several times,
Hot summer will worsen the crisis
According to experts, the situation will continue to worsen. As a result, the current crisis may become the most serious in the last 50 years. That is, the situation will be worse than in the 60s and 80s of the last century.
Currently, there is already a gas crisis in Europe, as well as an electricity crisis. It would seem that the situation could improve in the summer, because it’s time when countries have time to accumulate energy resources and prepare for the heating season. However, according to the head of the International Energy Agency Fatih Birol, a hot summer, on the contrary, can worsen the energy crisis.
a large amount of energy will be spent on air conditioning of houses in the private and industrial sector. At the same time, there may be a shortage of gasoline, kerosene and diesel fuel in Europe. But the reason for the crisis is not only in the conditioning of the sectors. The EU countries have already approved another package of sanctions against Russia, which includes an embargo on two-thirds of Russian oil. For Russia, this threatens to lose $ 22 billion, and for Europe — even greater problems with energy resources.
The sixth package of sanctions assumes that six months after its entry into limited force, a ban on oil supplies by sea to the countries of the alliance will begin to take effect. And eight months later, a ban on the supply of petroleum products will also come into force. The restrictions do not apply to supplies via the Druzhba oil pipeline.
In addition, the situation is aggravated by the self-sanctioning of traders. That is, they do not have an official ban on buying oil from Russia from the West, but they reduce the volume of purchases, fearing public pressure.
The IEA assumes that the total volume of oil supplies from Russia will decrease to 9.6 million b/d. Such a low level was last observed in 2004. Fatih Birol, like Tim Stewart, suggests that the current oil crisis will be the largest in 50 years, and they will last longer than the crises of the 70s and 80s.
Already, the prices of gasoline and diesel fuel are as high as possible, while their stocks are at the lowest level. But not all experts agree that the energy crisis, which has affected all energy resources, will worsen this summer. According to some analysts, if there is a fuel shortage, it will not be very large-scale. A really serious crisis will arise only in six months, that is, closer to the end of the year.