The EU countries will most likely not find a reasonable replacement for Russian energy resources, since the United States will not be able to quickly increase supplies to the required level, and South American and South African fuels are more expensive
European countries are unlikely to be able to find a “reasonable replacement” for Russian energy resources with the help of supplies from other exporters due to lack of infrastructure, high cost and logistical problems, Deputy Prime Minister Alexander Novak wrote in an article for the Energy Policy magazine.
American producers of liquefied natural gas (LNG) have been claiming a significant share of the European market for several years, Novak said. At the end of March, the US and the EU agreed to supply at least 15 billion cubic meters. m of gas during this year, US gas exports to Europe are expected to grow, the vice premier continued.
However, just last year, Russia supplied the European Union with ten times more gas— 156 bcm m, he pointed out. According to Novak, European countries will not be able to quickly increase supplies from the United States due to the lack of the necessary infrastructure.
“The cost of liquefied gas is much higher than pipeline gas from Russia. The factor of reliability remains important. We remember how last fall, due to higher prices in the Asian market, Europe missed a significant amount of LNG,— added the Deputy Prime Minister.
The European Union is also exploring the possibility of energy supplies from Kuwait, Qatar, Saudi Arabia and Algeria, Novak continued, recalling that OPEC had warned that it was impossible to replace supplies from Russia . European states may agree on the supply of coal from South Africa and South America, but experts, he said, are skeptical about the ability of these exporters to provide an acceptable price due to high demand and logistics costs.
“Thus, a reasonable alternative to energy sources from Russia hardly exists today. Taking into account Russia's share in the market, it becomes obvious that without Russian energy resources it is impossible to speak of a guarantee of Europe's energy security, — considers the Deputy Prime Minister.
Read on RBC Pro Pro How Fujifilm outperformed its competitors and passed a dozen crises after March 2022 Articles Pro Telecom lost Western equipment. What awaits Russian companies Articles Pro The company has suspended business in Russia. What to Prepare for Its DirectorEuropean comfort and “fate” their industrial enterprises are entirely dependent on the rationality of the decisions of the leaders of European countries, Novak concluded.
The European states have been discussing the possibility of imposing an embargo on energy imports from Russia since the end of February, searching for alternative suppliers. Washington has already imposed a ban on fuel imports from Russia, London plans to take a similar measure by the end of this year. British Prime Minister Boris Johnson said the embargo would help “end the bullying by the Kremlin”, noting that the process of cutting off supplies from Russia would not be easy and would cause “hard times”.
The embargo on gas and oil from Russia was not included in the fifth and last package of restrictive measures of the European Union to this day, despite the discussion of this decision. At the same time, the new sanctions imply a ban on the purchase and import of Russian coal, hot shale, peat and other solid fossil fuels.
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