Russian gas weapons are more powerful than oil

Gas is a valuable commodity for industries, the generation of electricity and for heating buildings, especially in Northern Europe, where winters are often very cold and long. This explains why European countries import gas from many sources, but are increasingly dependent on supplies from Russia to warm their homes and sustain economic development.

Cutting gas is more powerful than an oil embargo

In 1967 and 1973, Arab countries cut oil exports to the United States and Western countries supported Israel in its conflict with its Arab neighbors. Withdrawing oil supplies is a way to damage the other side’s economy and get policy concessions.

But today, the oil embargo is not as effective as it once was. Petroleum is a substitute in the global market. If one source cuts off exports, importing countries can switch to buying more oil from other sources, although they may have to pay higher prices than if they entered into long-term contracts.

This is possible because more than 60% of the world’s daily oil consumption is delivered by sea. At any given time there is a fleet of ships carrying crude oil from one point to another across the globe. If there is any disruption, the ships could change course and reach new destinations within weeks.

Therefore, it is difficult for an oil-producing country to prevent oil-consuming countries from buying oil on the global market.

In contrast, gas is transported mainly by pipeline. Only 13% of the world’s gas is supplied through liquefied petroleum gas storage. This makes gas more of a regional or continental commodity, with sellers and buyers all having direct contact with each other.

It is more difficult for buyers to find alternative gas than for oil, because laying gas pipelines or building new liquefied petroleum gas import or export terminals can cost billions of dollars and take years. As a result, gas disruptions are often quickly felt and can be prolonged.

The real cost of buying Russian gas

European countries’ dependence on Russian energy, especially gas, complicates their foreign policy.

Since Russia launched its offensive against Ukraine at the end of February 2022, observers have pointed out that this dependence for decades has made President Putin’s government tougher and European governments more resilient. Europe hesitates in the face of the moves of the Russian authorities. It is no coincidence that Russia began to attack Ukraine in February – the time when Europe is coldest and has the highest demand for gas to heat buildings.

Because the European gas network spans many countries, Russia’s shutdown of gas valves leading to Poland and Bulgaria has affected more than just those two countries. Gas prices will increase as the pressure of gas in pipelines running from these two countries to other countries decreases. The gas shortage will eventually affect countries further down the gas stream, such as France and Germany.

Countermeasures of EU countries

If European countries can rapidly reduce gas consumption and their gas-fired power plants choose other fuel sources, they can slow the painful process. Greater use of liquefied petroleum gas imported through coastal terminals also improves the situation somewhat.

In the longer term, the European Union is working to increase energy efficiency in existing buildings, which are now more efficient than those of the United States. They also aim to fill gas reserves to 90 percent capacity during off-peak seasons when demand for gas is lower. In addition, the EU can also promote local production of biogas, which can be used to replace fossil gas. Biogas is generated from agricultural waste as well as other organic, renewable sources.

Building more terminals to import liquefied natural gas from the US, Canada and other EU “friendly” countries is also an option. However, creating fossil fuel infrastructure would conflict with efforts to reduce greenhouse gas emissions to slow climate change.

A key EU priority is to increase wind, solar, geothermal and nuclear power plants as soon as possible to replace power plants using natural gas. Another solution is to replace gas heating with electric heat pumps, which also help regulate temperatures in Europe during summer heatwaves. These solutions are all in line with the EU’s climate goals. Thus, Russia’s shutdown of the gas valve can again help European countries transition to renewable energy sources and use electricity more efficiently.

However all these solutions are time consuming. And before the coming winter, Europe doesn’t have many options.

Russia closed the gas valve is counterproductive?

On the one hand this is painful for European consumers; On the other hand, that move is not very pleasant for Russia because Russia also needs money.

Currently, President Putin is forcing “unfriendly” countries to pay for Russian energy in rubles to boost the Russian currency, which has been depreciated due to the impact of Western economic sanctions. However, there are countries like Poland and Bulgaria that refuse to pay in rubles.

A key question now is whether Europe needs Russian gas more or Russia needs the money from energy sales to Europe more.