EC eyes potential for increased gas supplies to Europe amid Russia crisis

The European Commission is to seek potential increased gas deliveries from its supply partners in the coming weeks amid the intensifying crisis between Russia and the West over Ukraine.

Europe's energy commissioner, Kadri Simson, speaking Jan. 22 following a meeting of EU energy ministers in Amiens, said the EC would remain "vigilant" and look to improve the EU's preparedness for any supply emergencies.

"The commission is also discussing with our partners the potential to increase supplies to Europe," Simson said.

She said she would attend a ministerial meeting of the Southern Gas Corridor countries in Azerbaijan on Feb. 4 and a meeting of the US/EU energy council in Washington on Feb. 7.

Azerbaijan supplies around 10 Bcm/year of gas to Italy, Greece and Bulgaria, via the Southern Gas Corridor, while the US is a key supplier of LNG to Europe.

Simson said the EU continued to be faced with "unusually" high energy prices, which were being intensified by "geopolitical tensions."

She said there was uncertainty on the European energy markets as gas flows from Russia had dropped in recent months.

However, Kremlin spokesman Dmitry Peskov was cited Jan. 24 in Russian media as saying Moscow remained a reliable supplier to Europe and dismissed as "fake hysteria" suggestions Russia could halt gas supplies to Europe.

Russian flow

Russian supplies into Europe have fallen sharply since the start of 2022, with deliveries via main routes -- including the first Nord Stream system -- down compared with the final months of 2021.

Nord Stream is currently supplying around 146 million cu m/d of gas, down from its regular 158 million cu m/d flow rate, while deliveries via Ukraine at the Velke Kapusany interconnection point are down at just 26 million cu m/d, according to data from S&P Global Platts Analytics.

Under transit arrangements finalized in December 2019, Gazprom agreed to transit 65 Bcm of gas via Ukraine in 2020 and 40 Bcm/year in the period 2021-24, well down on a recent transit peak of 94 Bcm in 2017.

A total of 41.6 Bcm of Russian gas transited Ukraine to Europe in 2021.

Russian supplies via the TurkStream pipeline have also been lower in January compared with volumes delivered in December last year.

In a statement on Jan. 15, Gazprom said its gas exports to non-CIS countries in the first half of January totaled 5.4 Bcm -- or an average of just 360 million cu m/d.

That is more than 40% lower than the average in January 2021 of 626 million cu m/d.

The lower Russian supplies and geopolitical tensions over Ukraine have seen European gas prices remain at sustained highs.

The TTF day-ahead price hit an all-time high of Eur182.78/MWh on Dec. 21, an increase of 985% year on year, according to S&P Global Platts price assessments.

Prices have cooled since, though they remain at historic highs. The TTF day-ahead contract was assessed Jan. 21 at Eur80.28/MWh, still an increase of 300% year on year.