European countries will eventually resume increasing their imports of Russian gas, Qatar’s Energy Minister and CEO of QatarEnergy said, as he warned market volatility could last for years
Speaking at the Global Energy Forum in Abu Dhabi Saad Sherida Al-Kaabi said while Russian gas exports to Europe fell in light of Moscow’s invasion of Ukraine, a reversal of the trend is likely.
“The Europeans today are saying there’s no way we’re going back” to Russian gas, he said.
“We’re all blessed to have to be able to forget and to forgive. And I think things get mended with time… they learn from that situation and probably have a much bigger diversity,” he said.
“But Russian gas is going back, in my view, to Europe,” he added.
Europe has grappled with an energy crisis following Russia’s war on Ukraine, causing many countries in the region to turn to Qatar and the US in an effort to reduce their reliance on Moscow’s gas.
Russian energy giant Gazprom, which previously regarded Europe as its primary export market, reported this month that its gas exports to the European Union and Switzerland decreased by 55% in 2022.
In turn, the trend strengthened Qatar’s role as a top exporter of liquified natural gas (LNG).
Long-term need for LNG
On Saturday, energy ministers from Qatar and the United Arab Emirates said they expect a long-term demand for liquefied natural gas and that additional investment is necessary to ensure supply security and affordable prices during the transition to a new global energy system.
This came as Al-Kaabi explained that because there won’t be much new LNG on the market until 2025, volatility will last “for some time to come.”
Speaking about Europe, QatarEnergy’s CEO said “luckily they haven’t had a very high demand for gas due to the warmer weather.”
“The issue is what’s going to happen when they want to replenish their storages this coming year, and there isn’t much gas coming into the market until ’25, ’26, ’27,” he said.
He added that energy producers are concerned about a decrease in demand. The issue, he said, “is what’s going to happen when [Europe] want to replenish their storages this coming year and next year.”
Suhail Al-Mazrouei, the UAE’s energy minister, said during the joint panel discussion that “gas would be there for a very long time” and that additional investment was needed in gas as a base load even though more renewable energy would be generated
The UAE, an OPEC oil producer, has been concentrating more on the gas market ss Europe looks to replace Russian energy imports as a result of supply reductions brought on by western sanctions.
Qatar is already leading the LNG race through its mega multibillion-dollar North Field Expansion project, which is expected to increase its LNG production capacity to 126 million tonnes per annum by 2027.
State-owned energy company QatarEnergy is also set to become the world’s largest trader of LNG within the next decade.
Last week, QatarEnergy and the US multinational ConocoPhillips announced a deal to sell two million tonnes of liquefied natural gas (LNG) to Germany for at least 15 years starting in 2026.
“[The agreements] mark the first ever long-term LNG supply agreement to Germany, with a supply period that extends for at least 15 years, thus contributing to Germany’s long-term energy security,” Al-Kaabi said during a joint news conference with ConocoPhillips CEO Ryan Lance.
Source : Doha News
