Daily Energy Report
Gazprom gas exports to Europe, Red Sea geopolitical risk, Record US gas consumption, India wants US energy exports, Big Oil profits & buybacks, Solar industry in crisis, EU climate mess, and more.
Chart of the Day: Europe imports more gas from Russia
Gas shipments from the Russian energy giant Gazprom to Europe (EU and Ukraine) decreased by 5.8% month-on-month in January but jumped 35.5% year-on-year reaching 2,436 million cubic meters (mcm). This is up from 1,800 mcm in the same month last year as shown in Figure (1), according to Energy Outlook Advisors’ (EOA) calculations and data from European gas transmission platform (ENTSOG).
EOA’s Main Takeaway
Gazprom shipped 1,266 million cubic meters (mcm) of gas via Ukraine through the Sudja gas station on Russia-Ukraine borders, out of which 44 mcm of gas was taken locally in Ukraine and the remaining volume of 1,222 mcm was shipped to the EU member states. Gazprom daily gas exports through the Sudja metering point slightly dropped to 40.8 million cubic meters (mcm) in January, down from 41.1mcm in the prior month, but notably higher than shipments recorded in January last year, the EOA calculated.
Meanwhile, the total gas flows Gazprom shipped via the Turkstream pipeline, passing through Turkey, dropped to 1,170 mcm in January, down from 1,270 mcm last month, a drop of 8.5% month-on-month. However, this figure is significantly higher than January last year when total shipments reached 776 mcm. Using the two transit routes, Gazprom gas shipments to the EU member states dropped by 6.4% month-on-month in January, reaching 2,392 mcm as shown in figure-2, down from 2,556 mcm in December.
To conclude, despite the large decline in European dependence on Russian gas, when push comes to shove, Europe has no choice but to increase its gas imports from Russia.
Story of the Day
The link above is a must read. It is an interactive study of geopolitical risk and energy prices. Below is a shot from the interactive map by S&O Global
The escalation of maritime attacks in the Red Sea, linked to the Israel-Hamas conflict, is posing risks to global energy and shipping markets. Western military retaliation has not ceased the targeting of vessels, including oil tankers. In Europe, the Russia-Ukraine war intensifies, with Ukraine striking Russian oil infrastructure. These incidents contribute to freight rate spikes and supply chain pressures, while most oil shipments remain unaffected.
News of the Day
On January 16, 2024, the U.S. Lower 48 states set a new natural gas consumption record of 141.5 bcf due to a cold snap from a large mass of arctic air. This surge in demand was for space heating and power generation, leading to increased use and significant withdrawals from natural gas storage. Consumption averaged above 130 Buff/d between January 14 and 21, with residential and commercial use accounting for nearly half. Electricity generation, especially from natural gas and coal plants, also rose to meet demand.