Tighter Market but EU is Ready even if Russia Gas Supplies Drop

A significant European gas price increase is not expected even with a phase-out of the remaining Russian gas supply to Europe, Arne Lohmann Rasmussen at Global Risk Management said to Montel.

• “The EU still gets 15% of its gas from Russia. With about one-third via Russian LNG, one-third goes through Ukraine and one-third via Turkstream into eastern Europe,” Rasmussen said.
• The market would have time to absorb the impact if a decisions to ban Russian supplies were taken at the EU level.
• The existing five year Russian gas transit deal through Ukraine is due to expire at the end of Dec 2024.
• “Ukraine has been very clear they will not extend that agreement and the EU has said we don’t really need it,” Rasmussen said.
• At least 10% of the current gas imports to the EU could disappear in 2025, but it could also happen this year, he added.
• The drop in imports could create a tighter market next winter, especially with cold weather, but the EU is ready for it due to healthy storage levels and stable gas supplies from Norway.