Europe cuts gas demand by quarter in bid to shed reliance on Russia

EU countries cut gas demand by a quarter in November even as temperatures fell, in the latest evidence that the bloc is succeeding in reducing its reliance on Russian energy since Moscow’s invasion of Ukraine, Report informs via the Financial Times.

Provisional data from commodity analytics company ICIS showed gas demand in the EU was 24 per cent below the five-year average last month, following a similar fall in October.

European countries have been trying to pare back their reliance on Russian gas and oil by finding alternative sources or making changes to curb demand. They have been helped by an unseasonably warm autumn, although in the past two weeks temperatures have dropped closer to normal levels.

In Germany and Italy, the EU’s two largest gas-consuming countries, demand fell 23 and 21 per cent respectively in November, ICIS found. In France and Spain it fell by more than a fifth and in the Netherlands by just over a third.

Europe has also imposed sweeping new restrictions on Russia’s oil exports to limit its use of that energy source too.

The EU’s bar on seaborne Russian oil imports came into effect on Monday. Meanwhile G7 leaders have agreed to launch a so-called price cap that aims to keep Russian oil flowing to countries such as India and China to avoid creating widespread shortages, but only if the crude is sold at less than $60 a barrel to crimp Moscow’s revenues.

However industry executives and analysts have warned that without further declines in demand and more imports of LNG, gas shortages could persist for years in Europe.

The drop in demand meant gas storage facilities in the EU were at 95 per cent capacity in mid-November, according to industry body Gas Infrastructure Europe, close to an all-time high. Record inflows of LNG into the region also helped.

But colder weather in recent weeks has increased demand and storage facilities are now at about 93 per cent capacity.