Financial Times: While Putin doubles down in Ukraine, his gas gambit is failing

[onetexan]

https://www.ft.com/content/be331b8e-3a24-4941-b6d0-aa3041f789cf?ftcamp=traffic/partner/feed_headline/us_yahoo/auddev

"While Russia needs to sell the EU its natural gas, Europe no longer needs these supplies. Gas is becoming a buyer’s market. The energy crunch should be no threat to unified support for Ukraine, let alone Europeans’ comfort this winter, despite Putin’s machinations.

Analysis of underlying supply patterns reveals that, contrary to common belief, Europe is securing enough gas and liquefied natural gas from global markets to fully substitute for lost Russian supplies already. What is more, it can fully replace every last bit of Russian gas without any need for demand destruction or even substitution away from gas.

Since the invasion of Ukraine in February, EU sourcing of Russian gas has plummeted from 46 per cent to 9 per cent. This pivot came partially through increased piped gas from Norway and Algeria. Even more noteworthy, the dramatic increases in shipped LNG imports from the US and elsewhere have replaced the lost Russian vaporous gas from the targeted pipelines. This new supply surge to the EU now approaches, based on our calculations, 40 per cent of total global LNG supply.
_____________________

Good short article. Putin's gambit hasn't paid off at all.

[doc03]

1. The media has been saying Europe will practically freeze

to death this winter without Russian gas.

[BigmanPigman]

5. I know!!!

Two contradictory statements.

Which is the truth and which is BS?

[wnylib]

16. Depends on the source, doesn't it?

Which ones are credible and which are corporate RW shills? Which story supports the idea of shortages that justify higher energy prices?

[Amishman]

19. The commodity markets tell the tale, gas futures are lower now than months ago

Those who want to buy can find sellers. Prices are high, but manageable.

Recession reduced demand is definitely helping.

[paleotn]

21. Bingo.

[paleotn]

18. It's the easy answer, requiring little thought and no actual work.

Global supply is in relatively good shape due to China's woes and the economic cooling affect (no pun intended) of central bank interest rate hikes. That's allowed Europe to decouple from Russia with limited pain.

[brush]

2. Putin has proven to be a blunderer type leader...

much like his sycophant, trump. He's not the smart puppet master pulling trump's strings at all.

He's just a horrid bully who miscalculated totally his army's capabilities, and to make up for his and his army's failures, he resorts to bombing and shelling civilian apartment buildings.

I hope when this is all over, he's prosecuted for war crimes.

[Skittles]

3. excellent

MAKE RUSSIA IRRELEVANT

[at140]

4. That will be difficult for the simple reason

Russia has perhaps more natural resources than any other country.
The best way to punish Russia is to lower oil prices. Russia depends on oil exports.

[muriel_volestrangler]

6. "Lower oil prices" sounds like a button you want to press, or law you pass

Do you have a trick to suddenly cut world demand, or persuade the other producers to increase their output? The cost of doing whatever Saudi Arabia wants is almost as bad as negotiating with Putin.

[at140]

11. YES! Have you heard of Electric cars?

If 50% of cars on road were battery powered, oil prices will plummet.

[muriel_volestrangler]

15. How many years do you think it will take to manufacture half the cars on the road?

Even if you could just tell the world to never buy a gasoline or diesel powered vehicle again.

[at140]

22. Oil prices are looking forward, not backward

If it becomes obvious that EV's are catching on, even a 10% ratio of EV's/ICE cars will be enough to bring oil to its knees. I think it is happening already, with some states banning sales of ICE cars in the future years.

[MaryMagdaline]

7. Excellent! We need Europe to hold strong

[Evolve Dammit]

8. Damn Putin for this and stealing grain from Ukraine. He is a fucking monster.

[Lonestarblue]

9. When Putin began his illegal attack on Ukraine, I felt sort of sorry for Russian soldiers who

didn’t want to be fighting their neighbor. But with all the attacks on nuclear facilities, the brutality shown in essentially leveling the whole city of Mariupol, the atrocities found in Bucha, and the continued deliberate murders of civilians in apartment buildings and parks, I have no sympathy left for Russia. Hardliners in Russia are encouraging Putin to go all out and use any weapon to decimate Ukraine. I cheered the damage to the bridge to Crimea. I only wish it had been worse. And now I would cheer if Ukraine finally got the weapons they need to take this war to Russia and show them what it’s like to have your cities blown to smithereens and your people slaughtered for no reason. Not very nice of me, but there you have it.

[Biophilic]

10. And there you have stated my position perfectly. Nt

[onenote]

12. This article doesn't match up with other reports out of Germany

Where the price of natural gas has soared and shortages are occurring.

https://www.reuters.com/business/energy/german-gas-commission-wants-one-off-payment-now-price-break-next-year-2022-10-09/

https://www.cnbc.com/2022/10/05/german-minister-criticizes-us-over-astronomical-natural-gas-prices.html

https://www.washingtonpost.com/world/2022/09/17/europe-russian-natural-gas-prices-firewood/

[zipplewrath]

14. They may not be wrong, but...

Don't confuse predictions with reality. Everyone is working upon a wide variety of assumptions including the magnitude of demand and the magnitude of "realized" supply. Reality is probably somewhere in the middle with speculators wanting to be horrible, and increasing prices due to demand, and consumers and governments hoping they can deliver supply. Warmer winters could frustrate speculators, cooler winters could frustrate governments.

[paleotn]

20. Nat gas prices AREN'T soaring. Certainly not in historical terms.

They're roughly the same price per MMBtu as the 2000's. People think the world started in 2010 I guess.

https://tradingeconomics.com/commodity/natural-gas

Add the correlation of economic activity with energy prices. With interest rate hikes cooling global economies and China in the economic ditch, supply is less of an issue now, allowing Europe some room to decouple from Russian gas. Consensus is China will grow only a shade over 3% in 2022, loosening up significant demand.

[muriel_volestrangler]

23. That's natural gas in the USA. The European prices are quite different

since the amount that can be shipped between the markets (and others) as LNG is limited.

https://www.bbc.co.uk/news/topics/cxwdwz5d8gxt/natural-gas

In Britain, it's now trading at 300p/therm, or $3.30/therm, which is $33/MMBtu. That's about 4 times the highest price in the period from Oct 2017 to June 2021 (though also under half the peak it reached at the end of August this year.).

In that 2017-2021 period, the British price perhaps averaged 50p/therm - at then-exchange rates, about $.65/therm, or $6.50/MMBtu. So perhaps twice the average of the American price then. But now, it's about 5 times the price.

The thing is, the "world started in 2010" bit is what applies to the USA, with the shale gas rush that transformed the prospects of US gas availability.

Ah, I've found a long term table for UK gas prices:

1997: around "10" (not sure what units)
start of 2001: peak of around 25
start of 2011: around 50
Oct 2017: 46
Jun 2021: 63
Oct 2022: 256

I also see tradingeconomics.com has the 25 year UK natural gas price in chart form: https://tradingeconomics.com/commodity/uk-natural-gas

[Ford_Prefect]

13. Ruh-Roh!

[sleroy49]

17. I hope it's true, but...

I'm not sure how true this is, at least for all of Europe. We have several Danish exchange students that came here about a week ago and they said their gas bills have been ridiculously high lately. Ridiculously high as in $2,000 in a non-winter month.

[muriel_volestrangler]

24. See some charts in #23.

The UK wholesale price is now under half of the end-of-August peak (which may be an indication of the OP's article being basically right - the outlook for the winter it now under control, as in "Europe will have enough gas to get through" ), while it's still 4 or 5 times the price it was a couple of years ago, and for consumers, possibly 3 times higher.

If a household was paying $2,000 in a non-winter month, I think there's something very weird about their gas usage.

According to calculations by bank Nykredit reported by Politiken and broadcaster DR, a family living in a house with independent gas heating could face a bill around 33,000 kroner (for one year, commencing in August) higher in 2022-23 than in 2021-22.

Electricity bills could go up by as much as 12,700 kroner for a family with two adults and two children which uses around 4,000 kilowatts per hour, according to Nykredit’s calculations. Such a household can expect to pay 22,324 kroner for the year compared to 9,269 kroner for the previous year.

https://www.thelocal.dk/20220908/how-much-will-danish-energy-bills-go-up-this-winter/

33,000 kroner is about $4,300. That's per year, so even if they were talking about a bill divided up into 12 equal months, that's about $360/month more.