Europe braced for any gas crisis as Russia sanctions escalate

July 24, 2014

Europe has enough spare capacity in liquefied natural gas (LNG) to meet a large part of the region’s needs if Russia retaliates against the latest EU sanctions by restricting gas supplies. The showdown with Russian president Vladimir Putin comes at moment of surging global supplies of LNG, which can be diverted to European markets and reduce the Kremlin’s political leverage. The price of LNG in Asia has crashed from $20 to $11 per million British thermal unit (BTU) since February.

The pan-EU group Gas Infrastructure Europe said the network of LNG terminals in Britain and the Continent is currently operating at just 20pc of its full capacity. It could in theory boost flows by 160bn cubic metres (BCM), if there is available gas.

This is more than Russia’s entire shipments, which reached 155 BCM last year. The European network of pipelines does not cover every region and would leave pockets in eastern Europe without supply.

Copyright, The Telegraph, 2014.