Arab News, Thursday, Mar 10, 2022 | Sha'ban 07, 1443
Industry leaders say scarcity of gas a greater worry
HOUSTON:
Energy industry leaders said the burgeoning energy crisis is perhaps more dire in natural gas markets than in crude oil, due to Europe’s dependency on Russia and as prices have been sky-high for months.
Panelists at this year’s CERAWeek conference in Houston have stressed a greater
need for secure energy supply. While world crude markets have been roiled by the
US decision to stop importing Russian oil, Asian and European gas markets have
been in turmoil since last year as Russia slowed pipeline flows. “Clearly what
is happening in Europe is the problem of scarcity of gas. It’s not oil,” Gabriel
Obiang Lima, Equatorial Guinea’s minister of hydrocarbons said at the
conference.
Russia is the world’s largest exporter of natural gas, shipping out roughly 23
billion cubic feet of gas every day, of which about 90 percent goes to Europe or
Eurasia, with about half of that going to Germany, Italy, France and Belarus.
The US led an effort early in the year to secure more supply via liquefied
natural gas cargoes for Europe earlier, US State Department Senior Adviser Amos
Hochstein told the audience in Houston on Tuesday. He said that energy “is the
card (Russian President Vladimir) Putin thinks he has to intimidate his
neighbors.” The US is the world’s top gas producer, however, currently exports
just about all it can in LNG — about 12.6 bcfd, which it sends to destinations
across Europe and Asia.
“There’s just no additional LNG that’s coming online to bridge the gap for the
gas that’s going to be needed by Europe next year — and it was cold in Asia, and
Asia has no other alternative,” said Michael Smith, founder and chief executive
of Freeport LNG.
A source familiar with the White House’s thinking said the Biden administration
is mulling how much to cooperate with the US natural gas industry, wary that any
outreach would be seen by environmentalists as a capitulation on efforts to
reduce reliance on fossil fuels.
While the EU has not elected to stop buying Russian gas — Russia is still
sending gas to Europe via the original Nord Stream 1 pipeline — Britain on
Tuesday said it will phase out purchases of Russian oil and gas by the end of
the year.