IEA: China poses biggest threat to Europe in gas market
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Electricity prices in Europe could return this year to record highs, according to a fresh report International Energy Agency (IEA). Experts give such a forecast based on the expected recovery of the Chinese economy.
In 2022, China’s gas imports were significantly modest compared to previous years due to prolonged coronavirus restrictions in the country. This, as well as a warm winter and energy saving measures taken by the European authorities, led to a drop in gas prices by 80% from their peak values in 2022 and allowed Europe to get through the winter calmly even without gas supplies from Russia.
However, at the end of last year, the Chinese authorities lifted almost all existing restrictions, which should result in an increase in demand for electricity in 2023, the report notes. According to the IEA, this year China will increase gas imports by at least 35%. Fuel purchases could be significantly higher than even the record level of 2021. This will increase competition in the market for limited fuel supplies and may lead to a new round of gas price growth to the same high level that was observed in the summer of 2022, IEA experts say.
The difference between the lowest and highest estimates of China’s possible gas imports is 40 billion cubic meters. “This range is larger than the uncertainty associated with the potential loss of all remaining pipeline gas flows to Europe from Russia,” the agency said in a statement.
On the export of Russian gas to Europe – in the material “Kommersant” “Gazprom is catching up”.
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