What if Russia cut off the gas at the end of July? The prospect freezes the European capitals. The question is not rhetorical: for the past few days, all eyes have been on the Nord Stream 1 gas pipeline and its maintenance operations. In theory, the pipeline, which supplies a third of Russia’s gas exported to Europe, should work again after July 21. But no one is risking a prognosis: after all, Moscow has already interrupted or reduced its deliveries to a dozen countries. While most Europeans are thinking about their holidays, the 27 have therefore decided to greatly accelerate their preparations to reduce their dependence.
Last March, after the start of the military offensive in Ukraine, they had given themselves until 2027 to do without Russian gas. This calendar is exploding with the realization that everything can stop overnight. “Russia uses gas as a strategic weapon. Even if Nord Stream 1 is put back into service, we should not be asleep or have any illusions, because Putin may decide to cut everything in the heart of winter”, decrypts Simone Tagliapietra, professor at the Catholic University of Milan and researcher at the Bruegel Center in Brussels.
No leverage for Putin
On Wednesday July 20, the European Commission will present an emergency plan to deal with a sudden interruption. In June, Siberian gas still accounted for 20% of European imports. The 27 are supposed to fill their stocks to at least 80% of their capacity by November, but the Commission estimates that they will not succeed if the tap is cut quickly. At least 20 billion cubic meters would be missing, or about 5% of last year’s consumption. Brussels therefore advocates a general mobilization. “We must prepare immediately!” reads in a working version of the document. The International Energy Agency has also sounded the alarm. “It is better to take action now to prepare for next winter than to leave hundreds of millions of people at the mercy of the weather and give additional leverage to President Putin”, pleads its executive director Fatih Birol.
As a first step, Brussels wants to encourage European countries to voluntarily reduce their gas consumption, for example by limiting heating to 19 degrees and air conditioning to 25 degrees in public buildings. If everyone lowers their heating by one degree, this saves 10 billion cubic meters across Europe. Households are among the protected users whose energy cannot be cut off, but contingency plans will have to be drawn up for energy-intensive businesses. The Commission also recommends changing energy sources, moving towards oil or coal whenever possible. These measures are within the competence of the States, which have begun to put themselves in battle order. In France, during his speech on July 14, Emmanuel Macron announced a national sobriety plan which has yet to be detailed.
A watchword: mutual aid
Rapid and effective action would limit the repercussions on the economy, argues the Commission. If the detail of the measures is national, the European level remains crucial to coordinate efforts and ensure that everyone is pushing in the same direction, as quickly as possible. According to the International Monetary Fund, if the Europeans act in dispersed order, the gas cut could cost them between 2 and 3% of GDP. If they coordinate and help each other, the damage would be more limited, at most 1.5% of GDP. The economic think tank Bruegel has calculated that, to cope, European gas demand must be reduced by 15% compared to the average of previous years. As not all European countries are connected to each other and standards may differ, some areas may find themselves in greater difficulty. France, Spain and Portugal are among the least vulnerable, unlike Germany, the Baltic countries or Finland.
If they coordinate and help each other, the damage will be more limited for the Europeans
Secondly, if voluntary efforts are not enough and the situation becomes critical with the approach of winter, Brussels provides for a more restrictive instrument which would set objectives for each country and organize solidarity. In Brussels, many fear to relive the first months of the Covid epidemic, when the European states played “personal” before realizing that they had to organize themselves to buy vaccines together.
Russian trap
In recent weeks, each capital has also tried to secure supplies on its side. Just this week, France spoke with the United Arab Emirates, the Italian Draghi went to negotiate a contract of 30 billion cubic meters with Algeria, the Germans had taken the lead via a tour of the Gulf. “The risk this winter is energy protectionism with countries that will not cooperate, warns economist Simone Tagliapietra. This can have strategic consequences, for example on the unity of European foreign policy. we must not fall into the trap that the Russians are setting for us.”
On June 1, the European Commission created a platform that centralizes needs and will be able to make group purchases, as at the time of vaccines. On Monday July 18, the President of the Commission Ursula Von der Leyen was for example in Azerbaijan to sign a memorandum, which should make it possible to increase the volumes sent to Europe from 8 to 12 billion cubic meters. Contracts have been concluded with the USA, Egypt or Israel. Purchases of liquefied natural gas thus increased by 24 billion cubic meters in the first half, almost offsetting the decrease in Russian imports. But this track is now reaching its limits. “The LNG market is not a supermarket where we can go shopping before going home for dinner. It’s a very tight market with limited capacities and constraints at the terminal level”, underlines a European source.
Peace or air conditioning
It is therefore really on demand and our consumption that next winter will be decided. “Every household, every person can help save gas,” writes the European Commission. Its proposals will be considered by energy ministers on July 26. “Do we want peace or do we want to stay quietly with the air conditioning on all summer?” asked Italian Prime Minister Mario Draghi on 8th April last, referring to the end of European dependence. This question will be imposed on all Europeans.