How Europe can cope without the Ukraine gas pipeline this winter

 
Suzie Neuwirth

Amid growing fears that Ukraine is heading towards a civil war, concerns about the security of gas supplies have risen too.

Russia supplies around 25 per cent of Europe’s gas, with around 40 per cent of this coming through Ukrainian pipelines.

With Russia hiking the prices Ukraine pays for gas – and of course the possibility that Moscow could cut the beleaguered country off entirely – naturally there are concerns about a shortage in supply.

But new research from international energy consultancy Poyry says that if supplies are reduced over the summer, the impacts “should not be significant for Europe as a whole”.

The analysis argues that the supply deficit can be met through a combination of other sources: gas storage, liquefied natural gas, additional gas from Russia via different pipelines and a small volume of Central Asian gas through other Russian pipelines.

Demand for gas is expected to be lower in Europe next winter, which should also prevent supply margins tightening.

But if relations between Russia and the West worsen, this could have a detrimental effect on the ability to store gas, the report warns.

“Whilst Europe has sufficient storage capacity to see it through next winter, it is important to stress that there must be sufficient gas in store at the start of the winter,” said John Williams, senior principal at Poyry.

“It is also crucial that gas is able to flow freely to the markets that will need it most and that national security of supply is not used as a reason to withhold storage gas from the market.”

Energy secretary Ed Davey said after a meeting of G7 energy ministers in Rome yesterday that Russia must not be allowed to use energy “as a weapon” and that the leaders will “work collectively to protect our common energy security”.