Nicholas Newman Flame Europe's Leading Natural Gas & LNG Conference March 2016
Russian-owned Gazprom is the EU’s largest foreign supplier of gas accounting for around 30 per cent of Europe’s total gas consumption of 543 bcm (billion cubic metres) in 2013 reports the IEA 2014. Until summer 2014, buoyed by the rising price of gas alongside oil, Gazprom consolidated its market position, with a shopping spree across Europe for assets of energy companies and pipeline construction such as Nordstream, linking Russian gas fields with major European markets such as Germany, Holland and France.
In the face of Gazprom’s market behaviour over price and even stoppages of gas supplies to Ukraine in 2005, 2008-2009 and 2015 many central and eastern European countries have sought to diversify their gas suppliers. For example, during the 2008- 2009 Russia–Ukraine gas dispute, supplies were reduced not only to Ukraine but also to Hungary, Romania, Bulgaria and Poland (since all were supplied by the Brotherhood pipeline network) resulting in many factory closures to save gas for heating and power during an especially cold winter, reported the BBC in January 2009. And it was perhaps these demonstrations of market power that galvanised Brussel’s (European Commission’s) fightback in the form of market liberalisation reforms, increased gas storage facilities and interconnections to secure greater market integration and energy security.