for demand gas inside Europe will experience a record 10% decline this year increased due to rising prices Turning off the tap of Russian exports and demand contraction policies to avoid supply cuts this winter.
This scenario is Describes the International Energy Agency (IEA) in its quarterly report in the gas market, where it has accepted a high degree of uncertainty and revised its forecasts downwards and predicted a further 4% decrease in demand in Europe in 2023.
From the outset, the expected reduction in the Old Continent for 2022, Represents a cut of 54,000 million cubic metersIt will lead to a 0.8% drop globally because historically high prices affect the whole world.
During the first eight months of this exercise Europe absorbed 10% less gas compared to the same period in 2021 due to strong contractions in the residential and commercial sectors (-12%) and even more so in industrial uses (-15%).
However, gas for electricity generation was burned at almost the same level as in 2021, because drought cuts production of hydroelectric power plants More than half of the nuclear reactor fleet in Southern European countries and France has to make up for months of downtime due to maintenance work or detected defects.
Declining demand in Latin America
The drop in demand will not be a European phenomenon this year. In Latin America, the IEA expects a 4% decreaseThis is explained by the fact that hydroelectric production is much better than in 2021, but also by the decrease in demand in the sector due to high prices.
This evolution, first of all, Gas consumption in Brazil fell by 12% in the first half Compared to the same period last year, hydroelectric power plants were clearly operating at a higher rate, thanks to more abundant rainfall.
In Asia, the study’s authors predict the market will remain stagnant in 2022, which means: more than a sudden slowdown after the 7% shooting last year.
it has to do with it A very modest 1% increase in China partly due to the limitations and constraints of its policy. “zero covid“It was imposed by Beijing authorities.
Although North America is one of the few regions where demand has increased this year, prices there have also risen to levels not seen since 2008. However, this is largely due to the dynamics of production, which will increase by 4% in 2022 and 3% in 2023.
Close to recession in the global market in 2023
The IEA assumes that gas market will remain tense until 2023. In fact, it predicts an even lower increase compared to this year, with a new contraction of 4% in Europe, an increase of just 0.4%.
In his report, he details various crisis scenarios should Russia cut off its supply to the European Union altogether. It warns if this happens after Nov 1st, but reserve level is currently around 90%, this rate may drop below 20% and assuming the EU will receive highly liquefied natural gas (LNG) per ship.
If the arrival of methane tankers is not so smooth, reserves will remain around 5%this makes supply cuts reasonable in case of cold winter.
Avoid this black scenario and keep reserves at 25% will need to cut demand by 9% this winter 33% compared to the last five years and to guarantee a 13% more comfortable level.