Comments
anthonykantara t1_j94dmeu wrote
Another month then the weather warms up. So another year runway for increased Ukrainian support. Let’s see how Putin handles another year.
By next winter there would be even more alternatives to Russian gas
Timbershoe t1_j95f3cq wrote
Yup.
There were a lot of trolls saying Europe had no gas reserves. Putin was trying to swing public support.
They have huge gas reserves, they just needed to increase output. So that hope has now disappeared, and with Nordstream collapsed there is no return.
FuggleyBrew t1_j985g9y wrote
They reduced consumption significantly and increased prices substantially to build those gas reserves. There's still quite a bit of work to be done to get Europe to a stable point.
Timbershoe t1_j99fdv3 wrote
>They reduced consumption significantly and increased prices substantially to build those gas reserves.
No, they didn’t.
The European gas and oil reserves are a series of huge oil and oil fields.
Norway just discovered a huge new field a few months ago.
>There's still quite a bit of work to be done to get Europe to a stable point.
No, there isn’t.
It was only the logistics and cost of increasing extraction from the existing fields that was a problem.
FuggleyBrew t1_j9aalt1 wrote
>European natural gas prices and Asian spot LNG prices spiked to record highs in the third quarter of 2022. This reduced gas demand and incentivised switching to other fuels such as coal and oil for power generation. In some emerging and developing economies, the price spikes triggered shortages and power cuts. Europe’s gas consumption declined by more than 10% in the first eight months of this year compared with the same period in 2021, driven by a 15% drop in the industrial sector as factories curtailed production.
By contrast Norway increased, but less than the decrease in demand:
>The official gas export level for 2022, which has not yet been released, is estimated to be 8% higher than in 2021 (113 bcm), and similar to the record high of 122 bcm exported in 2017.
>It was only the logistics and cost of increasing extraction from the existing fields that was a problem.
Logistics isn't a trivial thing, many gas projects take years to complete. Further, with the demand decreases and the supply increases Europe has largely made it through this winter. You shouldn't take next year's price as the low point as the rationing seems to have worked, but to expect closer to the average of the last year, and both the low and the average are significantly above the long term average.
An LNG Tanker takes 2.5 years to build and shipyards we're already backlogged it is going to take sustained effort from the US and Canada to build gas pipelines, build export terminals and flow gas internationally to offset the impacts. The reorientation will take years.
Timbershoe t1_j9ade6q wrote
I have no idea what your point it.
It was an extremely mild winter across Europe, so consumption was less than forecast. Nothing to do with Russia.
They increased production to meet excess demand. It did not take years.
The EU does not need LNG facilities, that’s simply a cheaper import than the existing EU fields provide. An alternative, not a necessity.
But to go back to your original point, Europe did not ‘build up reserves’. The reserves were formed 10 between 180 million years ago.
FuggleyBrew t1_j9agnx5 wrote
>I have no idea what your point it.
You are celebrating far too early
> It was an extremely mild winter across Europe, so consumption was less than forecast
That decrease was through the first 8 months of 2022, that curtailment was due to decreased demand in the face of sky high natural gas prices. That allowed Europe to build the reserves it needed. Through next summer it needs to rebuild those reserves, which means ongoing elevated prices.
>The EU does not need LNG facilities, that’s simply a cheaper import than the existing EU fields provide. An alternative, not a necessity.
LNG is absolutely a necessity, without it Europe would basically give up being a modern economy. 40% of their gas comes from LNG
>The EU's overall LNG import capacity is significant (around 157 bcm in regasified form per year) – enough to meet around 40% of total gas demand. However, access to LNG infrastructure is uneven across the EU
For reference Norway is looking at 122 bcm and that's what it can produce for the next four years. The existing EU fields are running at near their maximum throughout to Europe, if the Netherlands empties out their remaining on shore reserves they will literally sink into the sea. Pipelines which were operating last year are gone, likely never to operate again. Your celebration is woefully misinformed and way too early.
>But to go back to your original point, Europe did not ‘build up reserves’. The reserves were formed 10 between 180 million years ago.
Europe bought gas on the market and placed it into storage facilities. It literally involves compressing gas into empty formations and storage vessels from overseas imports such as LNG, as a result Europe built reserves. Even the Norwegian gas, getting it from the formation to the continental reserves is a necessary activity each year, because natural gas in a formation offshore does nothing if the line from the North Sea is at full capacity.
They built line pack, all involved in taking gas from all of its sources and putting it into continental reserves.
Timbershoe t1_j9ah8tx wrote
You keep saying ‘build the reserves’.
I keep saying the only reserves are the EU Gas and Oil fields. They cannot be ‘built up’, they simply exist and they are extracted for use.
You continue to make this mistaken claim. I’m going to continue to correct you.
FuggleyBrew t1_j9ahtmy wrote
Natural gas storage is a thing which exists. In fact you even use old, now defunct formations for storage. Quite literally placing natural gas back into old formations building them up again.
>The regulation has been swiftly implemented. In September 2022, the EU had its storage facilities filled by 80% on average. In October 2022, filling level reached 90%. In December 2022, gas reserves started to be used up due to the weather, but as of January 2023, the filling level remains above 80%.
https://www.consilium.europa.eu/en/infographics/gas-storage-capacity/
Gas reserves is the appropriate nomenclature here.
Timbershoe t1_j9akajn wrote
That’s 15% of consumption at most, and it’s simply giant tanks that are filled from the existing gas and oil fields. Holding areas.
And most EU countries don’t have any storage capacity at all.
You’re confusing the capacity of the distribution network with it being the source. The reason for the increased retention in the network was to force utility companies to buy at the market rate, and not run at low capacity hoping the price would drop.
Gas reserves is absolutely not the right term. You clearly have no idea what you’re talking about and instead are google shit to try and back up your error.
FuggleyBrew t1_j9bf1hn wrote
> That’s 15% of consumption at most, and it’s simply giant tanks that are filled from the existing gas and oil fields. Holding areas
Also filled from LNG imports, and not just storage tanks, also placing gas back into continental formations. When Europe was increasing it's natural gas storage, this is what they were doing.
>You’re confusing the capacity of the distribution network with it being the source. The reason for the increased retention in the network was to force utility companies to buy at the market rate, and not run at low capacity hoping the price would drop.
The increase in reserves was to ensure that volume was purchased and brought local to Europe because during the winter demand would exceed production and imports, so they needed to store it. They could only achieve this through a combination of lowering consumption and increasing production and import capacity. Europe does not produce enough natural gas to meet its own demand.
>Gas reserves is absolutely not the right term. You clearly have no idea what you’re talking about and instead are google shit to try and back up your error.
You're clearly upset over the distinction between proven reserves and the amount they have in their current storage (the reserve they increased). You know the distinction between the geological reserves and their current storage reserves. You're engaging in this semantics argument solely to cover your own ignorance of the European market.
Want to call it storage? Don't care. You're wrong about the fundamentals.
Timbershoe t1_j9bkamh wrote
The EU hasn’t increased its LPG storage facilities. That will take years. The distribution storage is natural gas, not LPG.
LPG is held at ports, converted into natural gas then piped into the distribution grid.
Dear god, why are you are tripling down on not knowing the least about the subject, it’s like having a conversation with the dunning–kruger effect.
Some time in the past 12 months you clearly came up with the idea that the EU had no gas or oil fields. That they were 100% shipping all gas and oil in. I corrected you and you’re upset. Just deal with it.
FuggleyBrew t1_j9bqvmj wrote
> The EU hasn’t increased its LPG storage facilities. That will take years.
The EU increased it's gas storage, not it's capacity but total amount stored. Including storing compressed gas, enabled by purchasing LNG. Had it not been purchasing LNG it would not have been able to fill its storage, had it not decreased consumption it would not have been able to fill its storage.
>LPG is held at ports, converted into natural gas then piped into the distribution grid.
It's pipelines are part of the storage, as are the storage facilities connected to those pipelines.
>Dear god, why are you are tripling down on not knowing the least about the subject, it’s like having a conversation with the dunning–kruger effect.
You're ignoring official sources about what the EU did from the European Union itself.
>Some time in the past 12 months you clearly came up with the idea that the EU had no gas or oil fields. That they were 100% shipping all gas and oil in. I corrected you and you’re upset. Just deal with it
I never claimed that, and you know it. You're plainly ignorant of the very fundamentals of natural gas production and consumption in Europe and are actively spreading misinformation.
- Europe decreased consumption while maintaining production through high prices, rationing consumption and mandating high storage reserves.
- Europe simultaneously brought in LNG, because it would not meet it's requirements if it did not
- The increases in output of some fields are not enough to meet it's full requirement.
- The Continental EU does not produce enough natural gas
- Norway increasing production 8% doesn't make up for a 25% shortfall.
- To meet their requirements they cut back consumption, purchased a massive amount at a premium through the summer, and increased production
- Next summer they will have to continue the rationing, imports of LNG, and continue looking for new sources
This year we had a mild winter, that's no reason to assume there will be another mild winter next year. Refilling the storage will require ongoing high prices and ongoing rationing (either explicit or driven by the prices), although likely without the peaks being quite as high this time.
It is going to take time for the US and other countries to meet the requirements of Europe. Some LNG terminals are coming online but not enough soon enough and not enough tankers soon enough. Until that works itself out things prices are going to need to stay high and emphasis in North America needs to be on expanding export capacity and building up internal shipping capacity.
Nordstream 1 was 60 bcm/year, Norway increased production 8-10bcm/year. Where do you think the rest of the gap was? A decent chunk of it came from slicing around 10% of consumption back from April to September (note: this is not the benefit of winter).
That consumption cut will likely have to remain for the near future.
[deleted] t1_j9bs7iu wrote
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Dontbeevil2 t1_j98m761 wrote
Yep, no going back to Russian gas now. Courtesy of the US NAVY… maybe… allegedly. 🤣
[deleted] t1_j95tz2j wrote
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random-incident t1_j9e1azc wrote
Thanks Putin!
riffraffbri t1_j93lq5v wrote
That's because there are too many speculators in the commodities markets. They use every world hiccup to artificially drive up the prices.
[deleted] t1_j94re42 wrote
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OrderlyPanic t1_j95d9vr wrote
Also the winter in Europe has been mild even by modern standards.
FullM3TaLJacK3T t1_j95e4yc wrote
Winter didn't arrive this year. I'm in southern France and I was out in a tshirt yesterday.
[deleted] t1_j95emxq wrote
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me_suds t1_j97zfdm wrote
Russia "the winter will defeat them for us as always"
Winter " nah bro leave me out this one this shit is fucked up "
[deleted] t1_j94snx1 wrote
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mynameismy111 t1_j95m8hr wrote
Higher prices drives up investment and supply tho
ChipotleBanana t1_j96qx78 wrote
Oh sweet summer child...
Noimnotsally t1_j93dgnv wrote
My gas bill,24.00.... delivery fee- 75.00
You can wait on that,I will pay for my usage.
FrontCod7818 t1_j941mrn wrote
Tell me when Canada is next
[deleted] t1_j93jgtm wrote
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[deleted] t1_j95iqrl wrote
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Roundaboutsix t1_j95miho wrote
No big mystery here nor cause for speculation about Putin’s genius level, chess game strategy. Warmer than normal temperatures ease demand, lowering prices... The long term solution for this problem is for the UN to grow some testicles, step in, demand a cease fire, offer to administer the disputed territories for a twenty year period, followed by an internationally monitored referendum to determine their future geopolitical affiliation, etc., etc., etc. Time to negotiate folks.
DangerRangerScurr t1_j95sgr6 wrote
Step 1: kill all ukrainians Step 2: put in some russians and do a referendum Step 3: convince idiots on the internet that authoritarian countries suddenly care about democracy lmao
FuelAccurate5066 t1_j96in0c wrote
How about no.
byOlaf t1_j96mlsx wrote
Well he’s figured it out. Can you solve the Middle East for us next?
Sebekiz OP t1_j939a8g wrote
Looks like Putin's plans to force Europe to drop it's support of Ukraine by freezing them out isn't working out for him.