The European Union wants to quit all forms of Russian energy imports by the end of 2027. The EU has spoken a lot about this, but action has been mostly absent, with Russia still the second-biggest supplier of gas to the bloc. Now, a non-EU country’s gas ambitions could make Brussels’ task of quitting Russian gas even harder.
The European Commission this week announced plans to bring Russian natural gas imports to zero. This will, apparently, happen by the central government of the EU banning member states from signing new supply contracts with Gazprom while looking for a way to also get them out of existing contracts without having to pay penalties for breaching these contracts.
The first problem with this is that not all EU members are on board with the idea. Hungary and Slovakia are, in fact, very much opposed to the idea, arguing it would further compromise the competitiveness of European businesses for reasons relating to costs. Now, the Commission could get the two into line by adopting the plan with a qualified, rather than a full majority of member states. What it can’t do, however, is stop Turkey from turning into a gas hub, featuring a lot of Russian gas.
Hungary and Slovakia are currently getting their Russian natural gas supply via the TurkStream pipeline that runs under the Black Sea to Turkey and then on to Eastern Europe. According to one Bulgarian energy analyst from the progressive think-tank Center for the Study of Democracy, the existence of this pipeline can prolong the European Union’s reliance on Russian gas. Indeed, it has already increased Russian gas imports to Central and Southeastern Europe from some 30% back in 2021 to over 50% as of last year, Martin Vladimirov wrote in an op-ed for Reuters.
Tukey imports a lot of Russian gas. It uses some of it at home and exports the rest to Southeastern Europe. Turkey also has plans to become a major regional natural gas hub, both via imports from Russia and Central Asia, and through local exploration and production. The Turkish government has also made public plans to essentially replace Ukraine as a key transit route between Russia’s gas fields and European consumers.
According to figures cited by the Center for the Study of Democracy’s Vladimirov, Hungary is the biggest importer of TurkStream gas, with flows expected to reach 8 billion cu m this year. That’s up from 6 billion cu m in 2023. Slovakia, meanwhile, plans to ramp-up gas flows via the pipe by amending its long-term contract with Gazprom. Other countries getting gas from the TurkStream pipeline include Bulgaria, which is part of the transit route, Serbia, Romania, and some Western Balkan states.
Now, Vladimirov argues that these flows can be replaced entirely with liquefied natural gas. He does acknowledge, however, that this would come at a price, and it is not an insignificant price. This is what makes stopping Russian gas imports so difficult and what, combined with the presence of the TurkStream pipeline and Turkey’s LNG import terminals, suggests any attempt to bring those Commission plans to fruition is doomed. Because even if Brussels somehow bans Hungary and Slovakia from buying their gas from whoever they please, it would likely still continue to utilize Turkey as a middleman in gas supply—and gas molecules don’t come with a stamp of origin. The gas that the EU imports from Turkey in the future may be coming from Central Asia, but it may also come from Russia, despite any forceful measures to make sure this doesn’t happen. Just like it happened with oil and imports from India replacing imports from Russia itself.
Source: By Irina Slav from Oilprice.com