Some friends in Scotland are also struggling with very high energy prices though no actual shortages.
Zeus to Putin: I helped you guys out with Napoleon and Hitler, but now you’re just being a jerk.
Here’s a chart of the natural gas price. This is the NYMEX future, Louisiana delivery, so it doesn’t capture all of the supply peculiarities of actually getting it delivered to where it’s needed, but it sums up the big picture: the price has collapsed.
Europe has been having an unseasonably warm winter, fortunately.
Putin’s Energy Gambit Fizzles as Warm Winter Saves Europe
‘Meltdown’ of European industry averted, Germany’s Habeck says
Gas reserves are robust and prices are back at pre-war levels
Not just Europe. There’s a very large country in North America (well, two of them) that had to bite its tongue and do business with Venezuela to help with the shortages too…
Saw a news article yesterday that German gas prices have dropped down to the level from before the war in Ukraine. (But as others mentioned, many utilities are still working through high-priced supplies.)
It didn’t in hurt lowering the import numbers from Russia to Germany that the main Baltic pipeline seems to have sprung a leak, mysteriously.
There are several projects to build LNG storage and port facilities, notably in Holland. This will allow shipping liquified gas from overseas. Apparently Portugal had one of the bigger existing terminals and was piping gas to the nearby countries. Plenty of measures being taken.
Spare us the self-righteous drivel.
Let’s keep politics out of FQ, please.
This is an official warning for personal insults outside of the Pit.
Since you have a very long history of warnings for personal insults, you are also suspended while we review your posting privileges here.
The US LNG Industry (liquefied natural gas ) is running on steroids right now exporting to Europe (much of it to Germany). Many of my friends are making record bonuses and plants are running at over capacity. Germany just completed a gas plant/pipeline in record time.
Germany has also resorted to burning coal (brown coal actually which is one of the worst coals) to produce power. Concessions on emissions / pollution have been given.
However I have heard that the price of natural gas from US is thrice that of Russia. A lot of Europe’s economy relied on cheap Russian gas and that has gone away. I think an economist can better predict the results.
Also Americans have been cutting down forests on steroids too and making wood pellets for Europeans to use. Wood pellets count as green fuels in Europe but the process of making it is pollution intensive in the US.
This is just a small part of the realpolitik. Europe is buying fossil fuels from the gulf states and that means that poor countries that used to buy from Gulf states can no longer get their fuels . Europe has driven the prices sky high. There is a finite amount of fuel in the world and rich Europe should not be punishing the poor countries of the world !!
So yeah Europe should stand its high moral grounds and not buy from the gulf states and bear the winter with less energy. Or they should ensure that the poor countries get the fossil fuels at pre-war prices.
I can vouch for this. I live in the UK and it’s really bad. People are paying monthly what they used to pay per quarter… and it’s only going to get worse. Prices are due to rise again in April.
Really sorry to hear that and wish things get better. I have been reading reports like this which portray Brexit as one of the main causes Is Brexit to Blame for Britain’s Winter of Discontent? - Impakter
What’s your take on this ? (Not to hijack this thread and maybe I’ll start another thread. )
It’s interesting. A big part of what Russia has been trying to do the last couple of decades is prove that liberal democracy doesn’t work. It’s nice to see that, in a crisis created by Russia for the purposes of delegitimizing democracy, Germany and the rest of Europe stood up and showed him that we can get shit done if we really want it done.
And I have to wonder if this is another example of believing your own bullshit biting Russia in the ass. With climate change happening, the traditional Russian plan of “using winter to beat our enemies” is going to be less and less effective. Russia apparently really believed that Germany in particular, and Europe in general, would be freezing their asses off by now, and be just begging Russia to rescue them. How much of that is because they won’t acknowledge the reality that the climate is shifting?
A question for the Europeans - and the British bobbing adjacent - to what extent is energy conservation, in any form, being promoted and is it capable of having any effect at regular person level?
I think the reality is that Brexit plays a huge part. The narrative from UK Gov. is that the war and the pandemic are to blame for the whole ‘Cost of Living Crisis’ over here, but I honestly don’t think we’d be struggling quite like this if it wasn’t for Brexit.
There are also so many other issues, like food shortages, medication shortages, the National Health Service is in crisis (staff shortages, hospital beds completely full, doctors leaving to work in the private sector/abroad), the strikes (rail workers, postal workers, border control workers, teachers, nurses, doctors, ambulance and fire services)… the country is in a mess imo, due to a decade of this Gov. being in power. Brexit tipped it over the edge
OTOH the repercussions are global. Canada is a big energy supplier, yet my natural gas heating bill - for the same meter consumption - is 33% higher for last November than for last March. Obviously nowhere near the pain of UK or EU, but still significant.
It’s been wisely mentioned already, but I watched the Vice Chair of the International Panel on Climate Change discuss the issue. She really emphasized the ‘good fortune’ of the mild winter affecting most of Europe right now:
I’d rather that (Europe get to) be lucky than good – in this regard, at least.
NB: Canada has some of the lowest energy costs outside of the middle east.
So take the pain you’re experiencing, multiply it by four and you’re approaching the cost per kW in the UK.
I thought heating pellets came from waste product at lumber mills.
AIUI, Russia is pretty clued in to climage-change realities as far as impacts on their planned development of Arctic oil reserves are concerned, at least.
The tonnage of wood chips used by power stations converted from burning coal are huge. There is a debate about whether these bio fuels are carbon neutral. They are no doubt shipped using bulk carrier ships burning low grade bunker oil. Do the carbon neutral numbers add up or is this greenwashing by industries anxious to preserve their existing investment by switching the fuel.
A similar debate is going on in the gas business about how Hydrogen is made. The processes comes in a lot of different colours depending on the energy used and CO2 created and only one of these is green.
There was even a time, not so long ago, when diesel engines were regarded as a lower carbon producing engines deserving of tax concessions.
Balance sheets versus ice sheets.
The effects of Brexit on the economy, which was a political decision internal to the UK. Versus the massive borrowing to deal with the Covid pandemic lockdowns and the international energy crisis caused by Putin’s invasion of Ukraine. These were both huge events that had a cause that was external and cannot be blamed directly on the UK government.
Brexit may have been a foolhardy policy akin to shooting yourself in the foot. But the country can still hobble around trying to fix the damage to the economy from these far bigger global events.
The reckoning will come much later, when questions will be asked about why the economy is recovering so slowly and why there is a massive skills shortage. Comparisons will be made with EU countries of a similar size. Until then Covid and Putin are two very useful ‘Get out of Jail free’ cards in the game of political monopoly.
There may be delays in this being reflected in home heating bills, but things are looking much brighter. I found a Natural Gas futures contract for U.K. delivery, and the price has indeed collapsed just like the Louisiana price. The wholesale price peaked at 875p in August, it was as high as 345p in early December, but it is now 161p. It’s now lower than it was last winter, pre-Ukraine.
GWM00 | ICE UK Natural Gas Continuous Contract Overview | MarketWatch
It’s still much higher than it was pre-2021, but the panic and fear of people freezing in their homes is over. Putin has failed, Europe now has another year to work on power infrastructure and independence from Russian energy supplies before next winter. There is a lot to be done longer term, of course, but I have some degree of faith in human ingenuity, and I think this will strengthen Europe in the long run.
I’m surprised that the press hasn’t reported this well in the U.K. I guess headlines of impending doom get more clicks. This looks like a fairly balanced take on it: