Energy Crisis Across Europe Due To Russia-Ukraine War
Energy Crisis In Europe worsens as Natural Gas prices double in a week.
“Putin must fail and must be seen to fail in this act of aggression,” Boris Johnson, Prime Minister of England. He says that Russian President Vladimir Putin will “double down” on his invasion of Ukraine and “continue with the destruction”. He also states and I quote “Putin underestimated Western unity, and the governments of all the countries represented around this table have worked together, very effectively, to produce a package of economic sanctions that have had a very considerable effect on Russia.” Johnson will seek to rally the international community to make a “renewed and concerted effort” to end Moscow’s devastating war, and launch a six-point plan of action that he will detail on Sunday.
Well after reading these statements I can confidently say that Boris will not be bringing vodka to his other BYOB party.
Jokes aside, This invasion has put the whole of Europe on high alert due to the potential for major disruptions to the European energy market, which remains highly dependent on Russian oil and gas. It means that imposing tougher sanctions on Russia risks putting a serious dent in its energy supplies. Well, let’s take a deep look at this ‘who is dependent to whom’ situation.
What’s the current situation?
Russia is the world’s third-largest producer of oil and the second-largest producer of natural gas. By some estimates, fossil fuels account for 14% of the nation’s economic output. Revenue from the sector is responsible for more than 40% of its federal budget. While on the other hand, The EU is the largest importer of natural gas in the world, according to the Directorate-General for Energy for the EU, with the largest share of its gas coming from Russia (41%).
About 25% of the EU’s energy consumption comes from natural gas, oil and petroleum (32%), renewable energy and biofuels (18%), and solid fossil fuels (11%) make up the rest. With international benchmark Brent crude oil surpassing $100 a barrel for the first time since 2014 and Natural gas prices going up as much as 6.5% after the invasion, Europeans have been suffering under painfully high energy prices.
As the conflict continues, there are growing fears that Putin could use the country’s massive exports of oil and gas to Europe as leverage in its war. Former Russian president Dmitri Medvedev has already warned the bloc of sky-high gas prices.
To mitigate such a crisis, the White House is spearheading efforts to redirect energy supplies to Europe, but experts say any solution will come at a painfully high cost. On Wednesday, The Washington Post reported that the European Union is making plans for energy independence from Russia, citing sources who spoke on condition of anonymity. The plan is expected to be announced by the European Commission next week.
But how did Europe become so dependent on Russia?
Comparing Europe’s current situation with the 60s & ’70s shows that Europe was supplying the same amount of natural gas as it is importing now, which seems crazy to me.
The region used to be independent for natural gas, but then the production of natural gas in Europe decreased because the North Sea gas fields were depleted and it dried up completely. Adding to the fact that Russian gas was the cheapest to import so instead of importing from different sources, the EU made different routes to import from Russia.
According to the Directorate-General for Energy of EU, from 2012 the coal power generation has been decreased by a third in the region. And also during the same period, the EU has been reducing its dependency on fossil fuels to achieve its goal of becoming carbon neutral by 2050.
Well according to the experts, this whole dependency situation may not last as Europe can cut its natural gas imports from Russia within a year. Recently IEA a.k.a International Energy Agency released a 10 point plan to reduce Europe’s reliance on Russia.
- No new gas supply contracts with Russia.
- Replace Russian supplies with gas from alternative sources.
- Introduce minimum gas storage obligations to enhance market resilience.
- Accelerate the deployment of new wind and solar projects.
- Maximise generation from existing dispatchable low-emissions sources: bioenergy and nuclear.
- Enact short-term measures to shelter vulnerable electricity consumers from high prices.
- Speed up the replacement of gas boilers with heat pumps.
- Accelerate energy efficiency improvements in buildings and industry.
- Encourage a temporary thermostat adjustment by consumers.
- Step up efforts to diversify and decarbonise sources of power system flexibility.
The previous deals with Russia are about to expire this year but if I’m being honest, I am not sure about cutting all the ties with Russia will be the solution. I mean these countries are not fully independent from fossil fuels so for the upcoming winter season where are you going to get the oil from, Iraq?! (Not sure that’s a good idea) or even if they chose different countries the price pf per barrel cost will be super high and unless the whole protestants in the Europe who are holding banners of ‘Stop War’ agree to pay for the increased prices of petrol & diesel, I don’t think these countries will take such drastic measures. But if somehow they follow these guidelines it would result in a total annual reduction in EU imports of gas from Russia of more than 80 billion cubic metres, or over half, while still resulting in a modest decline in overall emissions.
Well, this war may lead to many greater things but it also highlights our biggest issues that we have to resolve as fast as possible. I’ve been studying since the 6th standard that all these oil reserves are going to end in the next 50 years but to solve those issues our steps have been slow. I mean what the hell happened in COP26!. But some countries such as Denmark, Netherlands & even UK are taking big steps for renewable energy which gives us some hope (Ironically most of them are from Europe)
Thanks for reading. Peace.
References -:
My social media handles -:
LinkedIn -: https://www.linkedin.com/in/haritashva-shrivastava-804b5b218
Twitter -: https://twitter.com/haritashva31
