Deputy Prime Minister Alexander Novak called the main causes of the gas crisis in Europe. He told about it in an interview with RBC.
he indicated that the European Commission “purposefully” refuses long-term contracts in favor of spot contracts. Politician explained that Spot does not allow to predict the medium and long-term perspective in the market. As a result, the summer European countries faced the situation when they failed to fill the storages, since gas went on economically more favorable markets.
In addition, the last cold winter influenced the rise in prices. Then, due to low temperatures, for three weeks, time was reduced to injection into underground storage facilities, and this did not allow to compensate for the difference between the selected 66 billion cubic meters of gas and injected 47.8 billion cubic meters.
Risks of Cold Winter Research also affect futures. However, this is a “ordinary market story,” said Novak.
At the end, the Deputy Prime Minister noted that Europe began to produce less in its own gas, thus refusing to the industry’s long-term investment. Since banks were given recommendations not to finance traditional hydrocarbon projects, the development of new deposits is not conducted, and should be expected in the future to expect even greater gas deficit.
Gas reserves in Europe are overlooked after the Russian supplier stopped booking additional gas transit capacity on the Yamal-Europe gas pipeline in Germany from December 21. According to Gazprom, that European buyers themselves do not make applications. Due to the freezing of supplies, the cost of gas in Europe for the first time in history exceeded $ 250 per thousand cubic meters.
After that, the United States came to the help of the EU: for the weekend, December 25 and 26, the country by a third increased the supply of LNG to the region. According to Bloomberg estimates, no less than seven other seven-seed ships were reoriented to Europe, attention to the tendency was previously addressed and Financial Times.
Later, the cost of fuel went down, but it remains relatively high. December 28 Futures for January traded around $ 1,200 per thousand cubic meters, testifying data to London Ice.