Daily Energy Report
EU LNG imports, Russian oil to India, Amazon nations summit, Oil’s talent crisis, LNG supplies to Europe, China buying more Russian oil, Aramco boost payout, Hamm scolds politicians, and more.
Chart of the Day: US dominates LNG exports to Europe.
Figure (1) above shows LNG imports of members of the European Union (EU) by source. While imports appear diversified at first glance, they are not. About 48% come from the US. Roughly 77% of total LNG imports come from three countries: the US, Russia, and Qatar. The data also show that 12% of total LNG imports came from Russia!
EOA’ Main Takeaway
Currently, about 50% of the EU natural gas imports are LNG. About half of that amount comes from the US. The US shale revolution enabled the US to replace Russia as the main gas supplier to Europe. From an energy security point of view, Europe did not do much to reduce its dependence on natural gas imports. It just changed countries with higher risks and higher prices. Long-term contracted piped Russian gas was replaced by spot LNG where the risk is higher and prices have no limits. We are in the midst of a hurricane season. All US LNG exports to Europe are based in the Gulf of Mexico. Severe hurricanes can cause disruptions. There is no replacement for US LNG in case of disruption except Russian gas!
Story of the Day
The average cost of Russian crude oil landing in India was $68.17 per barrel in June, the lowest since Russia's invasion of Ukraine over a year ago. This price is down from $70.17 in May and $100.48 a year earlier. India, along with China, has become one of the leading consumers of cheaper Russian crude since the conflict began. The discounts on Russian crude have narrowed, possibly influenced by recent supply curbs by Russia and Saudi Arabia.