Europe intends to abandon long-term gas contracts with Russia

Despite the energy crisis, Brussels wants to set a tough deadline for the EU countries, for which they must abandon long-term gas contracts with Moscow, writes the American agency Bloomberg.

The agency's analysts drew attention to the fact that the EU is concerned about its energy and environmental safety amid rising prices for "blue fuel" provoked by a shortage of raw materials and an increase in demand for it. Moreover, the terms of agreements for gas supplies from the Russian Federation may be shortened until 2049, since the Europeans have committed themselves to achieve "zero emissions" by 2050.

This is part of a comprehensive restructuring of the European energy market. However, the "green transition" may hit the interests of the largest gas supplier to Europe - Russia, which provides about 30% of all Europeans' needs for this type of energy raw materials.

The next EU plan runs counter to the interests of the Russian Federation, as Moscow is trying to build its trade relations on the basis of long-term contracts. However, Russians sometimes use gas to achieve political goals, so the abandonment of long-term contracts will allow Europeans to reduce risks. At the same time, the rise in gas prices is one of the risks of 2022, as it is associated with the growing tension in relations between the Russian Federation and Ukraine - a large transit country for Russian gas to Europe, the media from the United States summed up.

Note that on December 14, gas prices crossed another psychological mark, due to the vague future of transit through Ukraine and the threat hanging over the Nord Stream-2 gas pipeline. The cost of the January futures reached $ 1445 per 1 cubic meters. m. on the ICE exchange in London. On the TTF trading floor in the Netherlands, where gas is priced in euros per megawatt-hour, the cost of raw materials exceeded € 122,24 per MWh, which is calculated in terms of the price per 1 cubic meters. m. is above $ 1,4 thousand. Thus, for the first time since October, the price of "blue fuel" rose above $ 1400.

Moreover, the rise in prices is associated with two statements. First, on December 10, Serhiy Makogon, the head of GTS Operator of Ukraine LLC, said that he did not rule out the termination of gas transit from Russia through the Ukrainian territory this winter. Then, a few days later, in an interview with the ZDF TV channel, the new German Foreign Minister Annalena Berbock said that in its current form, Nord Stream 2 does not comply with European regulations and cannot be put into operation.
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  1. gunnerminer Offline gunnerminer
    gunnerminer (gunner miner) 14 December 2021 19: 34
    That was exactly what had to be proved, because you can't land cosmonauts only in Warsaw and Kiev.
  2. rotkiv04 Offline rotkiv04
    rotkiv04 (Victor) 14 December 2021 19: 36
    With such gas prices, this Europe hell will live until 2050
    1. Navigator Offline Navigator
      Navigator (Andrei) 14 December 2021 21: 13
      And so are we. We import a very significant part of the goods from Europe. Since the price of European goods will increase due to the rise in gas prices, we also automatically receive European goods with an increased cost. There is nothing good in raising gas prices for us. Only if we get a good profit for a short period of time. And then it will sharply decrease due to the drop in gas demand.
      1. Dust Offline Dust
        Dust (Sergei) 15 December 2021 18: 44
        And the thought didn’t occur to you that if the EU doesn’t buy gas from Russia, then we won’t buy goods from the EU, we won’t keep money there, we won’t travel across Europe. We will all buy from Southeast Asia. Do you know that we are under sanctions and cannot buy. In Europe and the USA, high-tech products, so why do we need their candy wrappers for which you can buy consumer goods and leave money with a tour operator ...? Russia can survive without EU goods, but whether the EU can survive without cheap resources is a question.
  3. Bakht Offline Bakht
    Bakht (Bakhtiyar) 14 December 2021 19: 43
    And what exactly does the new contracting procedure threaten Russia with?
    Gas supplies can only decrease if Europe makes a "green transition". Well, if hundreds of billions of dollars are thrown into green energy, then it may work out. But there is a risk of being left completely without heat and electricity ...
    1. businessv Offline businessv
      businessv (Vadim) 14 December 2021 19: 55
      Quote: Bakht
      And what exactly does the new contracting procedure threaten Russia with?

      you shouldn't pay attention to this American chant! Green energy in Germany has already stepped on a corn so much that they will soon abandon it in real life, although they will virtually be “for” it.
      1. Bakht Offline Bakht
        Bakht (Bakhtiyar) 14 December 2021 20: 02
        The essence of the EC energy proposal is not to abandon long-term contracts. This is all planned for 2049. Who will survive by that time - donkey or padishah is not entirely clear.
        The article does not highlight other key points of this proposal. The point is to provide access to gas reserves in European UGS facilities. That is why I also believe that ensuring that UGS facilities are filled with Russian gas is not entirely correct practice.
        1. businessv Offline businessv
          businessv (Vadim) 28 December 2021 18: 51
          Quote: Bakht
          That is why I also believe that ensuring that UGS facilities are filled with Russian gas is not entirely correct practice.

          This is true, but how else can you ensure uninterrupted supply? No way! Therefore, there is mutual dependence, which is normal in all respects, given the adequacy of the parties.
          1. Bakht Offline Bakht
            Bakht (Bakhtiyar) 28 December 2021 21: 29
            Uninterrupted supplies are assured. Based on the results of this year, it turned out that with 40 billion cubic meters through Ukraine and with the SP-2 inoperative, all deliveries were completed.
            Given that the European Commission is preparing new additions to the energy package (free access to gas storage facilities), this gas can be trite stolen. Referring to force majeure.
            In any case, I do not yet see a great desire of Gazprom to fill these very storage facilities. Uncertainty was in 2019, and it was then that Gazprom filled these storage facilities to capacity. But in 2020, the situation is slightly different. There is a transit agreement for 40 billion cubic meters. SP-1, South and Turkish Streams are working at 100%. Even the Polish transit was no longer needed.
            So Gazprom has reserve transit capacities. These are Ukraine and Poland. And leaving YOUR gas in a foreign territory is not very reasonable. Moreover, no one knows what other trick the EU will throw out.
            1. businessv Offline businessv
              businessv (Vadim) 29 December 2021 17: 09
              Quote: Bakht
              Moreover, no one knows what other trick the EU will throw out.

              smile I supported your idea, but as a reasonable person, I ask the question: for what purpose was the reserve created? Just for such a case, which happened - the price of gas increased by almost 10 times relative to long-term contracts. As a result, Gazprom earned a lot of money. Do you remember at what price the gas was at the time of injection? Whatever you are looking for: So everything is justified, even if they decide to use this gas, it will not be free because confiscation requires a court decision at least. This is just the chatter of narrow-minded EU politicians.
              1. Bakht Offline Bakht
                Bakht (Bakhtiyar) 29 December 2021 17: 38
                This is understandable, but intermediaries have earned much more.
                These are all the consequences of the innovations of the European Commission and the Stockholm Arbitration.
                What happened? Long-term contracts stipulated a mechanism for the impossibility of gas resale. That is, no small firms could resell gas. This condition has now been canceled. It was done to please Ukraine so that it could receive gas "by reverse". As a result, speculators gained access to gas.
                Now there is a provision that the gas in the storage facilities belongs to Gazprom. An innovation is being prepared that in the event of a crisis this gas can be withdrawn.
                The conditions for gas supply and storage have changed. This is not idle talk, but a directive is being prepared according to which the European gas market will operate. And no court decision will be required.
    2. Vdars Offline Vdars
      Vdars (Victor) 14 December 2021 22: 58
      But there is a risk of being left completely without heat and electricity ...

      - this is the whole point. Without gas, they WILL NOT MAKE the green transition !!! Or they will burn coal for an extremely long time and all the stated terms WILL REMOVE !!!
    3. ZAV69 Offline ZAV69
      ZAV69 (Zhukov A.V.) 15 December 2021 07: 53
      Green transition? Another attempt at someone else's expense on someone else's hump will ride. Europe thinks that Ivan will supply them with hydrogen for a penny, they will also tear the carbon tax from him for it, the whole industry will be sidelined, Uncle Liao will sell everything for 3 euro cents, and they will enjoy life. What if Ivan does not want to give away hydrogen for a penny and Liao asks for the real price for his product, where will their green transition be? That's right, in the ass. It is now possible to write the right pieces of paper and to master the money for this business, but nature cannot be fooled. If you want to live well - produce and consume energy, but if you want greenery - you will have water on the cards, recycled clothes and a chip under your skin for control
  4. Bakht Offline Bakht
    Bakht (Bakhtiyar) 14 December 2021 20: 23
    The main provision is not long-term contracts, but this

    The project, which the agency has seen, should be officially published tomorrow, December 15th. To improve the energy security of the European Union, Brussels intends to introduce several new regulations:

    - taking measures to ensure a high filling level of gas storages at the beginning of the heating season. In September of this year, underground gas storage facilities in Europe were filled to only 72%, which was the lowest in ten years. Analysts cited this as one of the reasons for the rise in gas prices;
    - voluntary joint purchases of strategic gas reserves by operators of gas transmission systems. Such reserves can be used in case of unforeseen circumstances.;
    - the obligation of the participating countries to assess the risks and take measures if gas storage facilities are owned by foreign companies. Where there is any risk, countries will have to, for example, establish mandatory occupancy levels for such storage facilities. Several large UGS facilities are controlled by Gazprom's subsidiaries in Europe: Reden, Jemgum and Katharina in Germany, Haidach in Austria and Bergermeer in the Netherlands. Before the beginning of autumn, they were filled only to 12,8% of their design capacity, which the company attributed to an accident at the condensate preparation plant in Novy Urengoy, which led to a reduction in Russian gas supplies through the Yamal-Europe gas pipeline.
  5. gunnerminer Offline gunnerminer
    gunnerminer (gunner miner) 14 December 2021 20: 47
    Gas prices are pushing the EU to develop a set of measures on how to avoid the use of gas in the future. A document has been prepared according to which the EU member states after 2049 will be prohibited from concluding long-term contracts for the import of blue fuel.
    Gazprom insists that its European partners conclude long-term gas supply contracts with it. With such agreements Gazprom is trying to keep permanent income for itself, and to save its European partners from high gas prices.
    Oil was as high as $ 140 a barrel during the 2008-2009 crisis, and gas was also expensive at that time, which is when alternative energy sources began to be created.
    Today the situation is somewhat similar to this situation. Oil, however, has not reached such heights, but gas is very expensive.
    You can say as much as you like that the world will not go anywhere from the use of oil and gas, and all the same they will come to us for a new portion of energy carriers. Green energy has taken a share of the market from traditional energy sources. And in the future it may increase its share. The PRC is investing impressive sums in green energy. The Power of Siberia pipeline may become unprofitable.
    But all this might not have happened if gas and oil cost so much that it would not be costly for consumers to buy it. Still, it is better if the price of gas is less, and this would suit both buyers and sellers. In the future, the Russian budget may lose a third of its income.
    1. Bakht Offline Bakht
      Bakht (Bakhtiyar) 14 December 2021 20: 59
      It is necessary to invest in the development of "green energy" only in Europe and only within ten years (until 2030) one (only) but a trillion dollars. Decarbonation is a great power. But you have to freeze.
      Flag in hand and a tailwind in the humped back.
      The EU's desire to lay its hands on Russian gas in European storage facilities looks more dangerous.
      1. gunnerminer Offline gunnerminer
        gunnerminer (gunner miner) 14 December 2021 22: 01
        The PRC is investing even more.
        1. Bakht Offline Bakht
          Bakht (Bakhtiyar) 14 December 2021 22: 04
          The PRC has more money. And the PRC pays more for LNG too. Europe cannot even pay 800 bucks per thousand cubic meters. If the EU has an extra trillion, then they are just in chocolate.
          But so far this is not visible. Or the gentlemen just want to get the gas connected.
  6. Valery Vinokurov (valery vinokurov) 14 December 2021 20: 59
    Why do we need long-term contracts? Who's to say?
    They are twice, or even 2/XNUMX cheaper than short-term
    And green energy is a myth, just like sick Greta Tumberg
    Eropa will not go anywhere from our oil and gas, only they will be for her now at exorbitant prices
    Well, okay ..
    PS: but in general, Europe still has to survive until 2049, as well as the outskirts)
  7. kriten Offline kriten
    kriten (Vladimir) 14 December 2021 21: 00
    The sooner they begin to destroy their economy, the better not only the United States, but also us. Just a few years and they can be ignored at all. There, power was seized by illiterate cooks, who do not follow analysis and forecasts, but slogans, moreover, from someone else's, from the owner.
  8. Scharnhorst Offline Scharnhorst
    Scharnhorst (Scharnhorst) 14 December 2021 21: 32
    In 2020, natural gas production in the Russian Federation amounted to 692,9 billion cubic meters. To maintain consistently high prices for gas abroad (profitable for the Russian Federation), I propose to adopt a law on a phased limitation of production by 2040 to the level of 500 billion. Something similar limits fish catch. Benefits: maintaining consistently high export prices; a gradual smooth transition from a resource-based economy; launch of energy-saving technologies in the country and preferences from decarbonization. Coal and oil, by the way, also concerns as non-renewable energy sources.
    1. Bakht Offline Bakht
      Bakht (Bakhtiyar) 14 December 2021 22: 09
      Yes, it would be nice to lower production. The problem is that, according to Gazprom's reports for the third quarter, gas production is at its maximum. And no one is going to reduce it. For the third quarter, GazProm reported super-high profits. More than 0,5 trillion rubles.

      Revenue: 2 billion rubles. (+ 373% QoQ; + 14,8% YoY)
      Adjusted EBITDA: RUB 809,6 billion (+ 15% qoq, + 142% yoy)
      Net profit: 584,4 billion rubles (+ 10,3% QoQ; -247,7 billion rubles in 2020Q XNUMX)
      Net debt: RUB 3 billion (-484,6% qoq, -2,6% yoy)
      Gazprom's export price to non-CIS countries in Q313,4: $ XNUMX per thousand cubic meters
  9. Jacques sekavar Offline Jacques sekavar
    Jacques sekavar (Jacques Sekavar) 14 December 2021 23: 09
    Demagogy about human influence on climate change is purely political and economic.
    For today and in the near future, there is no alternative to natural energy sources.
    Nuclear energy is ecologically clean, but potentially dangerous - a huge number of emergency situations and failures, attempts at cyberattacks.
    Thermonuclear fusion does not go beyond the scope of experiments, and it is not known when it will reach the industrial level.
    Solar, wind, tidal depend on geography and weather conditions, occupy vast areas and, in principle, cannot meet the growing needs of the economy.
    Hydrogen energy requires high energy costs, which reduces its profitability.
    Perhaps the development of the Earth's satellite will give an impetus to the development of solar energy and means of its transmission.
    If the “ecologists” have decided to fight for the purity of the environment (climate change does not depend on human activities and the change of geological eras proves this with all possible evidence), then one should focus on real tasks - wireless transmission of energy, which will significantly reduce its losses in the web of wires , processing of industrial and household waste, reclamation of land and water resources, uniform production requirements, etc., which will not have any effect within one or several state formations - a common problem can be solved only together, but together it will not work because the world's single environmental standards will consolidate the superiority of developed state institutions and will hinder the development of the rest, which actually puts them in neo-colonial dependence on the developed ones.
  10. zzdimk Offline zzdimk
    zzdimk 15 December 2021 05: 37
    Quote: rotkiv04
    With such gas prices, this Europe hell will live until 2050

    Life will be bad, but not for long?
  11. Kapany3 Offline Kapany3
    Kapany3 15 December 2021 08: 12
    Quote: gunnerminer
    That was exactly what had to be proved, because you can't land cosmonauts only in Warsaw and Kiev.

    Hooray! What a joy!!!
  12. boriz Offline boriz
    boriz (boriz) 15 December 2021 10: 29
    This already smacks of war communism. Which is not surprising. After all, the surplus allocation was not only with us. In Austria, it started almost earlier than here.
    That's just bad with their history and common sense. Well, Gazprom will work without contracts. But this will not be his initiative. The countries themselves will come and ask to change the treaties. If asked. But this is not critical either. The EU is not only until 2049, but also until 2030. will not live.
    And access to repositories without contracts is ridiculous. Well, they will get access, but there is no gas there. If you want to fill it, pay. The same is in the spirit of the 3rd energy package.
    The EU countries, seeing such an inadequacy of Brussels, will line up in the EurAsEC in an accelerated manner. Now there is a situation where any actions of the West are in Russia's favor.
    Berbock's words mean little. She is not a chancellor. Now, if they overwhelm Scholz, then yes. But this still needs to be done, and it will not change much. No contracts - no obligation to fill UGS facilities.
    The logic is simple: any whim for your money. Need gas - pay and receive. If you don’t want to receive it now, pay for storage if there is space in the UGS facility. No one is going to create gas reserves in UGS facilities at their own expense.
    Well, they don't certify SP2, so what, Berbock will personally pay for gas? She's just an idiot, not ready for leadership at the state level. She is purely a politician, I would say politician... Never led anything real. He understands nothing in international affairs. Duplicate of Kuleba: understands nothing of his duties and creeps into strangers, where he understands even less.
    1. Bakht Offline Bakht
      Bakht (Bakhtiyar) 15 December 2021 15: 45
      In this case, I do not agree.
      What is the point of access to gas storage facilities? The owner of the storage facility (and some of them belong to GazProm) MUST fill a certain volume. There is a contract or not, there is a buyer or not - it does not matter. The owner is obliged to fill up to some minimum. And store it there. That is, to pump gas at your own expense and pay for its storage yourself. And in a crisis situation (like now) the EU HAS THE RIGHT TO pick up this gas.
      Now, if Gazprom gets rid of its share in the storage facilities in Europe, then it will be a headache for the owners of storage facilities.
      But here the cunning dog from the EU is buried. GazProm did not buy any volumes of European storage facilities out of the blue. This was a guarantee of supplies if Ukraine or Poland (in general, any transit country) began to blackmail by cutting off supplies. These storage facilities served as a guarantee for the fulfillment of supplies and a guarantee for Gazprom to avoid penalties for disruption of supplies. If we now knock this trump card out of the hands of Gazprom, then with empty storage facilities, Gazprom will be FORCED to increase supplies through Ukraine and Poland.
      After all, the rejection of long-term contracts stretches for 28 years, and the issue of storage facilities can be accepted even tomorrow. This is a serious threat and must be dealt with somehow.
      1. boriz Offline boriz
        boriz (boriz) 15 December 2021 18: 52
        It is difficult to say so far, we have not seen their draft law and cannot judge its compliance with international law. I am not a legal expert. If there is a bill, there will be a reaction from lawyers, we'll see. With empty gas storage facilities, running into Gazprom is somehow risky. There are WTO norms. We just don't know. The US can afford to give a damn about VIO, but the EU - I doubt it.
        Again, how Scholz will react to Berbock's claims.
        And Ukraine is now very few people care. Germany refused to sell her arms. Zelensky was besieged, he does not suit anyone. Suspicious silence about G. Waldersee's visits to Kiev and Moscow. Waldersee is the UkroGTS representative from the USA, Russia and Germany. Zelya sent Merkel with proposals for the GTS. This aunt forgets nothing. Zelya threw both Biden and Putin and Merkel. No matter how they shoot him. When will Biden dance around Zela? Are you not enough of your own problems? How is he better than Kennedy? Will crash, dumped on the Natsik ...
  13. consultant Offline consultant
    consultant 15 December 2021 15: 04
    Quote: Valery Vinokurov
    Why do we need long-term contracts? Who's to say? They are twice, or even 2/XNUMX cheaper than short-term

    Long-term contracts are a guarantee of obtaining a concrete and stable profit. Short-term ones give a short-term effect of profit growth at the beginning, but then consumer bankruptcies, a sharp decline in demand, another economic crisis, a jump in prices and, as a result, a sharp drop in the profits of energy supplying companies, etc. follow. This is if in a simplified form.