The quantities delivered by the Ukrainian route in the first four months of this year were the lowest since this country separated from the Soviet Union.
The fact that Russian transit deliveries of natural gas to Europe via Ukraine were reduced in the first quarter of this year by 47 percent compared to the same period last year, and that this is the lowest amount of gas delivered in the last 30 years, and that the reason is commissioning The Turkish Stream pipeline raises the question of whether gas consumption is declining. Or the Covid 19 pandemic is to blame for everything, which halved the industrial gas consumption, since the economy in most countries has not worked for more than two and a half months.
The quantities delivered by the Ukrainian route during the first four months of this year were the lowest since Ukraine separated from the Soviet Union, confirm the data of the Ukrainian operator of the gas pipeline transport system LLC. According to them, the main culprit is “Turkish Stream”.
If that is the case, the question is whether Serbia, when the construction through Bulgaria is completed, the Turkish Stream gas pipeline will be the main supply route, both for its own and for export needs, and whether Ukraine will remain a backup option for our country or will it all go by a new gas pipeline from Turkey through Bulgaria, Serbia, Hungary to Austria. Especially if we keep in mind the latest developments with “North Stream 2”, which the Federal Network of German Agencies will not release from the regulations of the EU gas directive, that is, the application of the third energy package.
More precisely, it wants to oblige Russian “Gazprom” to cede half of its gas capacities to a third party. The same thing that was asked of Serbia on the occasion of the “Turkish Stream”, and which our country solved through domestic legislation.
Ljubinko Savic, an independent energy advisor at the Serbian Chamber of Commerce, says that there are many reasons why the situation is like that, and that the main reason is certainly not “Turkish Stream”.
“First of all, a mild and warm winter. Then the gas pipeline “North Stream”, which now supplies Germany with gas, but also the pandemic of Covid 19, which caused a decline in industrial production in all countries of the world. “In the European Union, especially in Italy and Germany, as the largest importers of Russian gas,” he said.
We should not overlook the fact that there were significant surpluses of electricity, which halved the price of electricity in Europe compared to January. This led to replacement, that is, to consume electricity instead of gas, because it was more cost-effective. And all that then further reduced the quantities of gas that were delivered to Europe via Ukraine.
It is unlikely, he points out, that the reason for such a drastic drop in gas transit through Ukraine is only the Turkish stream, because in the first phase it supplies Turkey, which is not in the EU, and a little bit Bulgaria. Only with the completion of the route through Bulgaria and Serbia, we should expect a more active and greater participation of gas in this corridor as well, says Savic.
“In the future, Serbia is counting on this direction of supply and on revenues from transit. First of all, it counts on gas for its own needs, and that will be the dominant direction of supply. Whether the transit route through Ukraine will be used will depend on the partner – the Russian side. “The Turkish stream is designed to supply southern Europe, and therefore Serbia as well,” Savic explains.
It is not good for Serbia to close its doors to itself by cutting off supplies through Ukraine, but to use both directions. The reason is security of supply, to which all countries attach first-class importance, says Srecko Djukic, an expert on gas conditions in the EU.
“Besides that, we should not lose sight of the increasingly strong position of the European Union towards the uncompromising application of the third energy package in the construction and transport of gas intended for the European market, with which Serbia had problems, and which should be the reason why we should not give up,” our interlocutor points out.
Djukic adds that there are several reasons why the demand fell, that is, the consumption of Russian gas through Ukraine.
“The main reason is the extremely mild winter, which did not require the consumption of gas from full gas storages. The second is the fact that liquefied natural gas, regardless of which side it reaches the European shores, is becoming more and more competitive with gas from pipelines and its consumption is constantly growing and exceeds one third of the total gas consumption,” our interlocutor points out.
And thirdly, all this was followed by a pandemic, which stopped economic life.
“It also caused a drop in oil demand, but also a significant reduction in the price of gas to below 100 dollars per thousand cubic meters.” In any case, Serbia should use both directions for gas supply, even though it is the same, Russian gas, both through Ukraine and through the “Turkish Stream”. The reason is simply security of supply, to which all countries attach first-class importance,” he points out.
What, he points out, will be the fate of the “Turkish Stream”, which extends across the Balkans to Central Europe, as well as the unfinished “North Stream 2”, hardly anyone can say now. One is wishes, and the other is a very real energy and gas security policy in Europe, which is wholeheartedly supported by US policy, Politika reports.
