Russia has the ability to do more to expand its supply of natural gas to Europe and help alleviate the soaring energy prices in the region, according to the International Energy Agency (IEA).
In a press statement, the IEA said Russia is currently supplying less gas to the European market compared to pre-pandemic levels. This, coupled with factors including increasing demand for gas in Japan, Korea, and Brazil (due to the drought), decreases in solar and wind energy generation in Europe, and an increase in energy demand in Europe (due to the re-opening of economies) has resulted in EU energy price increases and supply shortages, according to the IEA.
However, the IEA says it believes Russia has the potential to help EU countries to fill their storage capacity and address the current increase in energy prices and anticipated shortage this coming winter. Today, gas storage levels in Europe are well below their five-year average, said the statement.
The IEA says the current crisis in Europe presents an opportunity for Russia to prove that it is a reliable supplier of natural gas to the European market, following previous accusations that the country uses its gas reserves as a political weapon.
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Despite the shortages in Europe, Russia is fulfilling its long-term contracts with European counterparts, states the IEA.
IEA Executive Director Fatih Birol, said: “Recent increases in global natural gas prices are the result of multiple factors, and it is inaccurate and misleading to lay the responsibility at the door of the clean energy transition.
“Today’s situation is a reminder to governments, especially as we seek to accelerate clean energy transitions, of the importance of secure and affordable energy supplies.
“Well-managed clean energy transitions are a solution to the issues that we are seeing in gas and electricity markets today – not the cause of them.”
The energy market trends in Europe in the past weeks have led to an increasing number of countries turning back to coal to meet energy demand, according to the IEA. This in turn reverses the climate action progress the region is working towards.
However, the trends show the important role natural gas plays in the energy transition. Even if European countries deploy renewable energy solutions, their reliance on gas to meet energy demand will not go away in the near future, according to the IEA.
If the current crisis is not addressed, European consumers are expected to pay more in energy prices in the coming months, witness unplanned outages (according to the IEA) and experience food shortages (according to Reuters).