According to Yuri Vitrenko, CEO of the Ukrainian public group Naftogaz. a third of the gas exported from Russia to the European Union risks being lost due to the conflict in Ukraine.
“We estimate that a third of the gas exported from Russia to the European Union through Ukraine will be lost if the (Russian) occupying forces do not stop disrupting the operation of stations in the recently occupied territories,” he said. wrote Yuri Vitrenko on Twitter.
Since the start of the offensive on February 24, Russian troops have notably taken control of parts of Ukrainian territory in the south of the country. They are also continuing their offensive in the east, where they have made Donbass, which forms the regions of Donetsk and Lugansk, a priority war objective.
While some countries of the European Union such as Germany, Austria or Italy for example are very dependent on Moscow in terms of energy, the 27 have set themselves the objective of reducing their imports of Russian gas by two thirds. by the end of the year. The main outlet for Russian hydrocarbons, which provide significant income for Moscow, the EU decided in early April to stop its coal purchases in August but has not yet decided on an embargo on gas and oil.
Stop “soon” of Russian gas imports into the EU (Charles Michel)
kyiv is calling for a halt to imports of Russian hydrocarbons, but European countries, including Germany, are warning against the violent recession that such an embargo would cause. Visiting kyiv on Thursday, European Council President Charles Michel assured that sanctions would soon target Russian oil and gas exports, as demanded by Ukrainian President Volodymyr Zelensky. Also on Thursday, Italy, one of Europe’s biggest gas consumers, announced that it would “soon” stop buying Russian gas “for ethical reasons”. For its part, the Dutch government announced on Friday its ambition to end its independence from Russian oil, gas and coal by the end of the year, by focusing on energy savings, sustainable energies and the increased imports from other countries.
Germany does not plan to do without Russian gas before mid-2024
On the other hand, the German government of Olaf Scholz is one of the main opponents of an immediate halt to imports, believing that economic and social peace in the country is at stake, with consequences for the other economies of the EU. EU. Germany does not plan to be able to do without Russian gas before mid-2024, according to Berlin. This refusal arouses the irritation of kyiv and several European governments.
An immediate European embargo on Russian gas could indeed cost Germany dearly, up to 5% of its GDP this year, according to an estimate published by the German central bank on Friday.
“Germany’s real GDP could be up to 5% lower than forecast” in the event of a voluntary or sudden stoppage of Russian gas imports, the Bundesbank detailed in its monthly economic report for April. This would amount to a loss of “180 billion euros” for national production, she added.
In such a scenario, the German economy could register a recession of 2% this year, estimates the study. Inflation, already galloping in the country, could gain “1.5 points in 2022”, and “2 points in 2023”, compared to a scenario without an embargo, according to the institution.
Germany, and particularly its industry, is particularly dependent on this resource, which represented, before the conflict, 55% of its total gas imports.
“I don’t see how a gas embargo can put an end to the war at all,” German Chancellor Olaf Scholz repeated on Friday in an interview with the weekly Der Spiegel.
“We want to avoid a dramatic economic crisis, the loss of millions of jobs and factories that would never open again,” he added.
However, Germany has already reduced its Russian imports, in the first quarter of 2022, to 40% of the total, by stepping up its efforts to find other suppliers, such as Qatar or the United States. The country has also recently released an envelope of three billion euros to equip itself with large floating terminals of liquefied natural gas (LNG), which it does not have at the moment.
EU can do without Russian gas in next six months: IMF
For Alfred Kammer, the European director of the IMF, Europe can do without Russian gas over the next six months, but to do without it would have a very heavy impact.
“Over the next six months, Europe can live with a total shutdown,” the German head of the International Monetary Fund said in an interview with AFP on the sidelines of the spring meetings in Washington.
In summer, the needs are lower and European countries could also draw on their stocks. However, reducing inventories to critical levels would put strong upward pressure on prices which are already at record highs, the official warned.
“On the other hand, if the interruption were to last until winter, or even over a longer period, this would have significant (negative) effects” on the European economy, continued Alfred Kammer, pointing to the serious risk cuts during the winter. The IMF has calculated that a total disruption of Russian gas and oil supplies could potentially cost the European Union economy 3%.
The estimate of the impact remains subject to great uncertainty since we cannot, for example, predict today whether the next winter will be long and harsh.
But faced with the potential effect on the economy, Alfred Kammer recommends alternative emergency measures.
“There is no single option that is likely to have a big impact” on its own, he admits. “But the accumulation of many small measures will have a greater impact.”
One of the measures is the search for alternative sources of supply and the countries have already started to do this by turning to Algeria or Norway, he underlines.
Consumers also have an important role to play in participating in the collective effort.
Governments can raise awareness through “information campaigns to reduce energy consumption”.
“The consumer can act now,” insists the head of the institution. “And reducing energy consumption makes it possible to store more gas (…) which will make it possible to attenuate the effects of subsequent cuts” potential.
No recession
To accelerate their energy transition, the most vulnerable populations could be offered subsidies, he also suggests.
All these measures have a “modest” effect if taken independently of each other. But added together, there will be an accumulation effect.
Although the war in Ukraine has greatly slowed growth in Europe, Alfred Kammer believes that “the recovery will not be derailed”.
“We don’t see a recession,” he added. The major Eurozone economies, with the exception of Spain, will be “weak in 2022” and a quarter or two of near-zero growth or even a technical recession with two negative quarters are not excluded.
But the IMF expects these economies to recover in the second half of this year.
(with AFP)