Russia’s gas cuts throw fuel on Asia’s energy security woes

by | Jul 28, 2022 | World

Taipei, Taiwan – The latest cut in Russian natural gas flows to Europe threatens to further destabilise energy security in Asia and could accelerate a move away from liquified natural gas (LNG) in the region, experts say.On Wednesday, Russia’s state-run energy giant Gazprom cut gas supplies to Europe via Nord Stream 1 to just 20 percent of the pipeline’s capacity.
While Gazprom cited turbine maintenance for the disruption, European Union officials cast the latest in a series of supply disruptions as a  “politically motivated” move linked to the tensions between Brussels and the Kremlin over the war in Ukraine.
LNG futures in Europe leaped as much as 10 percent on the news, while spot prices in North Asia soared to their highest point since March.
Utilities in South Korea and Japan are reportedly anxious that Europe will hoard more gas as northern winter approaches and are moving quickly to secure as many LNG cargoes as possible.
“The direct impact of Nord Stream cuts will be intensified competition for very limited LNG cargoes,” Kaushal Ramesh, a Singapore-based gas analyst at Rystad Energy, told Al Jazeera.
“We expect Asian buyers who can afford it – mainly Japan and Taiwan – to compete with Europe. Physical transactions in Asia are already topping $47/MMBtu (Metric Million British thermal units) and yet we’re nowhere near winter.”
Russia’s state-run energy giant Gazprom has cut supplies of gas to Europe via Nord Stream 1 to just 20 percent of the pipeline’s capacity [Fi …

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