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Anticipate Tighter Energy Supplies Next Winter, Says IEA

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Note* - All images used are for editorial and illustrative purposes only and may not originate from the original news provider or associated company.

Fatih Barol, the International Energy Agency head has warned of potential energy shortages in the next winter since very new LNG is available on the market, although it is said that China’s consumption is going to be rising this year.

According to Barol, the European governments made substantially right decisions throughout 2022 like constructing more LNG terminals so as to replace the Russian gas pipeline deliveries.

However, the luck also favoured them this time around as the winter was mild with dampening demand as well as economic weakness in China which further led to the consumption drop. Barol explained that it is right to say that this winter they are off the hook as long as there are no last-minute surprises; however, the real issue is what will take place next winter. An additional 23 billion cubic metres of LNG is expected in 2023. Even with a marginal increase in the economic output since the restrictions on the pandemic eases-off, China is anticipated to take-up 80% of the additional gas.

Although there are sufficient LNG import terminals, there may be a dearth of gas to import, and thereby, it is not going to be an easy winter for Europe this year as all this is going to push the prices up yet again. He asserted that this is not the right time to relax or to celebrate. Even with a fresh push to develop new gas fields, it will take years before they come online.

It is thereby sought from firms as well as households to thrive in their efforts in reduction of gas and expand the renewable energy output at a faster rate. Head of the German network agency that is into regulating gas and electricity markets, Klaus Mueller said recently that possible gas shortages taking place next year can be a possibility especially when the German storage facilities will have to be filled minus the Russian pipeline gas.

He added that although they can manage it, they will have to make a big effort. As per him, it will always be better not to let the levels of storage drop below the current 71.52% levels.

Birol has also gone on to warn a few countries which had taken a decision to get rid of nuclear energy and in fact asked them to reconsider the scenario saying that the temporary nuclear plants extension up until April was a right step forward. He is of an opinion that all energy sources are the need of the hour to prepare for the next winter.

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