The scarcity of Russian fuel flows to the EU has already led to produce constraints within the LNG market, the TotalEnergies CEO says
The European fuel market can be tight this 12 months because of the must refill storages, as provides from Russia are severely diminished, TotalEnergies СEO Patrick Pouyanne advised Belgian information outlet L’Echo on Saturday.
In line with Pouyanne, the present downward pattern in power costs won’t final lengthy.
“The winter is kind of delicate, the storages are full, Europe must import much less liquefied pure fuel (LNG). However the fundamentals stay there: in 2023, Europe will obtain much less Russian fuel than it obtained in 2022. It is going to once more need to massively re-import LNG, despite the fact that it has not but settled its re-gasification capability issues… And as Europe might want to import greater than in 2022 when it obtained Russian fuel for about half the 12 months, the scenario will change into tense once more,” he warned.
The worldwide LNG market already skilled a “violent shock” final 12 months, as one eighth of it, almost 50 million tons, needed to be diverted to Europe to make up for the misplaced Russian provides, Pouyanne stated.
“It’s a shock, Europe did it, but it surely paid extra. Your complete LNG market is now constrained by provide. And it’ll not loosen up earlier than 2025-2026, as a result of whenever you take a look at the brand new tasks introduced, in america and in Qatar, they’ll solely go into manufacturing in a couple of years,” the TotalEnergies СEO stated, including that with the intention to substitute all of the fuel that the EU as soon as obtained from Russia (100 million tons per 12 months), it must double the quantity of LNG it imported final 12 months.
READ MORE: International imports of LNG hit all-time excessive – information
This will show tough not solely on account of current provide constraints, but additionally because of the reopening of the Chinese language economic system, a significant shopper of LNG, which will even increase LNG demand.
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