Energy crisis in Europe

In 2021, Europe’s total gas imports from Russia was 155 billion cubic metres, accounting for 45% of all gas imported to Europe and 40% of total consumption. Russia’s invasion of Ukraine triggered a global crisis; Europe is seeking harsh sanctions against Russia. However, Russia has threatened to shut off gas supplies to European countries, despite the fact that major countries such as Germany, France, and Italy rely on its ideological opponent Russia for gas supply.

In the summer of 2022, Europe is facing a confluence of chaos, from heatwaves to drought, from travel disruption to a cost-of-living crisis, and now Russia has cut off critical gas pipelines ahead of winter. Gazprom, Russia’s gas giant, has halted the Nord Stream 1 pipeline for indefinite time period due to an oil spill.

Russian President Vladimir Putin is using gas supplies as a weapon to bring Europe to its knees. Without Russia’s critical gas supplies, Europe would be left without the means to remain warm this winter, from geezers to heaters, which all operate on power that is ultimately fuelled by Russian gas.

Looking at the major European economies, Germany receives 50% of its gas imports from Russia, followed by Italy (46%), and France (24%). Among the big economies, the British and Spain were less dependent on Russian gas. To satisfy their demands, these two countries rely on local and alternative supplies of gas. Small and medium-sized economies rely on Russian gas more than large economies. According to the statistics, some small European countries are entirely reliant on Russian gas. Macedonia, Bosnia and Herzegovina, and Moldova are among these countries. These countries consume 100 percent of the gas imported from Russia. Similarly, Finland was 94% dependent on Russian gas, Latvia 93%, and Poland 40%. While the Netherlands, Poland, Romania, Georgia, Ireland, and other European nations imported less than 15% of their gas from Russia, Ukraine is likewise dependent on Russian gas to some extent, although since the Crimean crisis in 2015, it solely reimports Russian gas to European nations rather than importing it directly from Russia. Despite the fact that some of the gas destined for Europe passes via Ukrainian territory.

During the cold war, the supply of gas from Russia to Europe began. When the industry was expanding in Europe and fresh gas deposits were discovered in the then-Soviet Union’s Siberian area. Gas was the most important obligatory necessity for Europe at the time since it was necessary for the European industry to run or to fulfil the demands of the heat in the winter. Western countries signed gas pipeline expansion deals with the Soviet Union since some of today’s eastern European countries were either part of or backed the Soviet Union, and Russian gas was already entering.

It was not so simple to accomplish during the cold war because the US was also watching and opposing Western European nations’ efforts. The rationale for this was that Western Europe and the United States were NATO allies. At the same time, despite American resistance, West Germany agreed to purchase gas, and Russian gas began to arrive in West Germany in 1973. Several contracts were made for the extension of gas pipelines during this period and in the following decades; moreover, in 2012, the Nord Stream 1 pipeline was completed between Germany and the Soviet Union, which directly delivers Russian gas from Russia to Germany across the Baltic Sea.

Gas from Russia is less expensive for European countries, as it is delivered straight without any intermediaries. Germany, Europe’s top industrial power, buys about half of its gas from Russia. It need a steady supply of gas to power its vast industries and remain competitive in Europe and worldwide, and it can only get it from Russia at a low cost. Another reason to acquire Russian gas is the hard and lengthy winter season. Gas is utilised in Europe to keep dwellings warm and to fulfil other household demands, thus not only industry, but also Europeans, require gas for existence. According to a 2020 poll, one-third of the gas utilised in Europe was used in homes.

Europe is transitioning away from coal energy in order to attain carbon neutrality and reduce greenhouse gas emissions. Because the process of generating electricity from coal emits a large amount of greenhouse gases, which is extremely hazardous to the environment. As a result, the only choice is to fulfil the energy needs by gas.

The purchase of nuclear energy in European countries is dependent on popular emotion, which also influences local politics. Europeans are outraged whenever nuclear power facilities are mentioned as a source of energy. Recently, when the European Commission advocated shifting to nuclear energy in the aftermath of Russia’s impending gas shutdown, several European nations objected, citing the significant danger of accidents with this form of energy. That is why nuclear power plants in some countries are not operating at full capacity. France and Germany are at the top of the list. In reaction to public outrage following the Fukushima accident, Germany chose to shut down its power plants in 2011, and 14 of the 17 power plants were shut down in the following years, with the other three expected to close later this year.

Given these viewpoints, the only choice for European countries is to purchase cheaper gas from Russia. Russia is presently the world’s greatest gas exporter, with 45% of total Russian gas sold to European nations alone, generating hundreds of billions of euros each year. In this circumstance, Russia will never take an action that will severely harm its economy. Russia will not cut off gas to European nations because doing so will force European countries to seek gas from alternate sources, which will become increasingly significant as time passes and pose a danger to Russia. If Russia takes such a step, it will be viewed as an untrustworthy trading partner across the world, and countries would refuse to sign contracts with Russia.

If supplies to Europe are cut off, Russia would have to export gas to keep its economy running, and delivering gas to its new client will be difficult. New pipeline construction takes years. For a limited time, Russia may cause an artificial energy crisis in Europe. It did so when European nations threaten Russia with sanctions after it invades Ukraine. In response, Russia curtailed gas supply from the Nord Stream by 20% for 10 days, causing an artificial gas crisis.

Europe should look for a new gas partner, such as Norway or Azerbaijan. They may also purchase LNG from the United States and Qatar, the world’s second-largest supplier after Russia. Wind and solar energy may also be used to address the energy demands of European countries. However, these undertakings are time-consuming and expensive. Given all of this, it appears that European nations will continue to rely on Russian gas in the foreseeable future.