Europe’s gas supply could be a casualty of Ukraine-Russia war

The current crisis between Russia and Ukraine has put the United States and its European allies on high alert for the possibility of the first major interstate military conflict in Europe since World War II. Although efforts to find a diplomatic solution to the crisis continue, the scope for a mutually agreeable outcome has narrowed now that the United States and NATO have rejected Russian demands that no additional troops of NATO is deployed in Eastern Europe, while continuing to provide arms and other forms of assistance. to Ukraine.

In addition to the concerns raised by the crisis over European security and Russian revenge, Europe is also particularly alarmed by the potential for major disruptions in its energy market, which is highly dependent on Russian oil and gas. Indeed, a military invasion of Ukraine could create an energy catastrophe in Europe if it led to the total suppression of Russian gas exports. The diplomatic fallout from an invasion could also trigger the cancellation of ongoing energy projects within the European Union, such as the Nord Stream-2 gas pipeline to Germany, which would have long-term implications for the EU. European energy supply.

Although Brussels and Washington are currently looking for alternative suppliers to prepare for such an eventuality, the reality is that none of them can offer an immediate solution to the announced shortfall.

Even absent the outbreak of hostilities, Russian gas supplies to Europe have already been a quarter below normal over the past year, causing European gas prices to rise above records. Russia currently supplies about a third of the gas and crude oil imported by the EU, of which a third transits through Ukrainian territory. Among other routes bringing Russian supplies to the EU market, the Yamal-Europe gas pipeline runs through Belarus and Poland to Germany, and Nord Stream 1 goes directly to Germany via the Baltic Sea.

As the crisis on the Russian-Ukrainian border escalated, the US and EU desperately began to seek alternative partnerships and potential fuel swaps to offset potential shortages should Russian supplies be cut off. The United States has already played a direct role in bolstering Europe’s gas supply by increasing its deliveries of liquefied natural gas to the continent, reaching two-thirds of US export volumes in January. The United States has also asked Qatar to help Europe with LNG shipments if Russia launches a full-scale war against Ukraine this winter.

However, Qatar and other alternative suppliers cannot fully replace Europe’s huge gas demand, as this would require the re-routing to Europe of all its current LNG exports to its major Asian customers, creating a energy deficit across Asia. As Qatari Energy Minister Saad Al-Kaabi made clear, “Qatar’s priority is to meet the needs of its existing customers first. Ensuring Europe’s energy security will require a collective effort from many different suppliers.”

Libya has also been touted as a potential option for alternative supplies, given its vast natural gas reserves and proximity to Europe. But while Libya may at some point be a real option for the EU to diversify its energy sources, for now the ongoing conflict and political instability pose a serious challenge to securing shipments. immediate LNG.

The EU will need to find more potential gas suppliers as the Russian-Ukrainian crisis unfolds, while dealing with the likelihood that any Russian gas cut will have profound implications for the European economy.

Azerbaijan is another candidate to fill part of Europe’s gas deficit. It already supplies southern Europe with gas via the Trans-Anatolian Gas Pipeline, or TANAP, and the Trans-Adriatic Gas Pipeline, or TAP, which together supply around 8 billion cubic meters of natural gas to Europe via Turkey. Since its inauguration, the Southern Gas Corridor – the umbrella project for these and other planned gas pipelines – has been touted as a much-needed source of energy diversity for Europe.

It was therefore not surprising to see European Commissioner for Energy Kadri Simson visit Baku last week to discuss the current energy crisis and request additional gas deliveries, with the aim of increasing the volume to 10 billion cubic meters. Nevertheless, if Azerbaijan has the capacity to increase its deliveries, it cannot hope to compete with the Russian state company Gazprom, which currently exports 10 times more gas to Europe.

This means that the EU will have to find more potential suppliers as the Russian-Ukrainian crisis unfolds, while facing the likelihood that any Russian gas cut will have profound implications for the European economy as well as for systems. health of EU Member States in the midst of the crisis. Covid19 pandemic.

If there’s a silver lining, it’s that a close look at previous similar energy crises between Russia and the EU suggests there’s little chance Moscow will abruptly cut off all energy supplies to Europe. . Such a drastic move is even less likely now, given the significant costs such a cut would also impose on Russia’s stagnant economy. Still, that could change if the Biden administration follows through on its threats of additional tough economic sanctions against Russia in the event of an invasion, including disconnecting the Russian economy from the SWIFT international financial transaction network. In this case, Gazprom could very well stop its deliveries of natural gas on the pretext that it has no way of getting paid.

Even in the worst-case scenario of a complete cut off of Russian natural gas supplies in mid-winter, however, EU member states’ strategic gas reserves could last until March or April. So while Central and Eastern European countries would remain vulnerable depending on how many well-supplied member states would be willing to share their reserves across the bloc, it is an overstatement to say that the EU would be unable to survive a supply disruption in the short term. US and EU efforts to gather additional gas supplies, including increased deliveries of US LNG to the continent, will also ease Europe’s near-term energy vulnerability.

But in the long term, these efforts will be insufficient as other potential suppliers like Qatar and Azerbaijan will not be able to increase their shipments to Europe enough to make much of a difference. Meanwhile, the Russian-Ukrainian crisis still has the potential to trigger lasting geopolitical unrest in Europe, especially as Russia is clearly willing to weaponize its energy resources as a bargaining chip to intimidate EU members. and NATO for more concessions under the pretext of a “security guarantee. This means that the issue of European energy security and the need for the EU to diversify its supplies will remain pressing.

Fuad Shahbazov is a political analyst covering regional security issues in the South Caucasus. He is a former research fellow at the Azerbaijan Center for Strategic Studies and a former senior analyst at the Center for Strategic Communications, also in Azerbaijan. He was a visiting scholar at the Daniel Morgan School of National Security in Washington. Currently, he is an MA candidate in Defense and Diplomacy at Durham University in the UK. He can be found on Twitter at @fuadshahbazov.