18.10.2021, 11:13
WEC Secretary General Names Causes of Energy Crisis in Europe
Source: OREANDA-NEWS
OREANDA-NEWS. The crisis in European energy and in other regions of the world is caused not so much by geopolitics as by an unexpected recovery in demand and a redistribution of the market, Angela Wilkinson, Secretary General of the World Energy Council (WEC), told RIA Novosti.
"This is not a geopolitical crisis, this is a combination of other factors. What is happening in Europe or China or Oceania or Latin America or North America is a combination of surprise in the form of a return in demand. Asia has greatly increased the demand for gas. This takes the market away from Europe, "she said.
According to the interlocutor of the agency, gas suppliers from all over the world rushed to Asia in search of higher prices.
"This is what happens when you rely on the market. Eighty percent of gas supply contracts are covered by long-term contracts. All of them are fulfilled, but among other things we are experiencing more extreme weather conditions, we are more vulnerable to them, our systems need to be changed." added Wilkinson.
In addition, she noted that the current situation is not similar to the energy crises of the past.
The European gas market has been in a fever in recent months. If at the beginning of August futures were trading at around $ 515 per thousand cubic meters, by the end of September they more than doubled, and on October 6 they reached a historic high of $ 1937. Then some pullback followed, but prices still remain high.
As noted by experts, this is due to the low level of occupancy of underground gas storage facilities on the continent, limited supply from the main suppliers and high demand for LNG in Asia.
"This is not a geopolitical crisis, this is a combination of other factors. What is happening in Europe or China or Oceania or Latin America or North America is a combination of surprise in the form of a return in demand. Asia has greatly increased the demand for gas. This takes the market away from Europe, "she said.
According to the interlocutor of the agency, gas suppliers from all over the world rushed to Asia in search of higher prices.
"This is what happens when you rely on the market. Eighty percent of gas supply contracts are covered by long-term contracts. All of them are fulfilled, but among other things we are experiencing more extreme weather conditions, we are more vulnerable to them, our systems need to be changed." added Wilkinson.
In addition, she noted that the current situation is not similar to the energy crises of the past.
The European gas market has been in a fever in recent months. If at the beginning of August futures were trading at around $ 515 per thousand cubic meters, by the end of September they more than doubled, and on October 6 they reached a historic high of $ 1937. Then some pullback followed, but prices still remain high.
As noted by experts, this is due to the low level of occupancy of underground gas storage facilities on the continent, limited supply from the main suppliers and high demand for LNG in Asia.
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