As the weather turns colder, Europeans may feel a chill like never before:
After a three-day overhaul, Gazprom announced that the Nord Stream-1 gas pipeline would no longer resume gas supply on schedule due to multiple equipment failures.
On August 31, the "Nord Stream-1" natural gas pipeline began to be overhauled and stopped supplying gas again.
After Gazprom announced the outage, European gas prices rose nearly a week, up nearly 40 percent.
Whenever the flow of the Nord Stream-1 gas pipeline decreases, it is a turning point in the jump in European gas prices:
From June 16, the gas supply of "Nord Stream-1" was reduced to 40%, and on the 15th, the price of natural gas in Europe rose by 24%;
Since July 27, nord stream-1 gas supply has been reduced to 20%, and on the 25th and 26th, European natural gas prices have risen by at least 10%.
The valve switch of nord stream-1 stirs the nerves of Europe.
What's more, this outage is even closer to the upcoming winter, and a crisis is beginning to brew in Europe.
Winter is approaching, and europe's crisis is not just a lack of gas.
Whether Europe can survive the winter smoothly, the EU's gas reserve ratio is an important indicator.
The data shows that on August 30, the EU natural gas reserve rate has reached 80.4%, and is advancing at the normal reserve rate of previous years.
This means that the EU has already completed its gas storage targets at this stage ahead of schedule and in excess.
The EU's target for this year's gas storage is also after the escalation of the Russian-Ukrainian conflict and the first round of surge in European gas prices. At that time, the EU's natural gas reserve rate was only less than 40%, and there was a trend of reduction at one point.
After assessing the risk of gas supply disruptions from Russia in the winter, the EU passed a deal requiring EU member states to have gas reserves at least 80 percent of their total capacity by November 1.
Germany, which used to import half of its natural gas from Russia, now has a reserve rate of 84 percent, and the executive director of the European Trade Center, the operator of the gas market, recently predicted that there will be no nationwide gas shortage in Germany and that Germans will not be frozen this winter.
But the risk remains – regional shortages cannot be ruled out.
This is especially true at the EU level. Although the overall EU is up to standard, Italy, Hungary and other countries, gas storage has been lower than the past average.
△ European Commission President von der Leyen has pinned the news that the EU's gas reserve rate has reached 80% on social media, and the photos are, from left to right: The Prime Minister of Latvia, the Prime Minister of Estonia, the Prime Minister of Denmark, the Prime Minister of Finland, the President of Lithuania, von der Leyen.
With russia supplying less gas, EU countries must look for alternatives. After the escalation of the Russian-Ukrainian conflict, EU member states began to travel outside the continent to buy natural gas:
In April, Italy frequently sent senior officials to Africa to find natural gas supply sources, signing cooperation agreements with at least three countries;
In May, Italy was followed by Germany, where Chancellor Schoelz embarked on his first trip to Africa, visiting three countries in succession;
In August, French President Emmanuel Macron visited Algeria, where relations were deteriorating last year, and the two sides began negotiations to increase algerian gas supply to France by 50%;
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When EU countries start to act separately at the same time, this is no longer a simple supply and demand problem, but will trigger the butterfly effect.
This is the same as the food crisis, if the grain production is reduced by 20%, the price of food will not only rise by 20%, but will be infinitely high - everyone is worried that they will become the one who cannot eat food, and under the robbery, the price of food will continue to rise.
This is also directly reflected in the trading price of natural gas. Now, take the transport ship full of liquefied natural gas, exporting from the United States, the cost is 60 million US dollars / ship, but the final sale price to Europe is as high as 275 million US dollars / ship.
Meanwhile, benchmark Dutch gas futures, known as the "weather vane" for European gas prices, broke through €300/MWh in August, seven times the same period last year and more than 10 times higher than the average price before the energy crisis.
△ In March, Biden went to Europe to participate in the NATO special summit, the G7 summit and the EU summit, promising to export more LNG to Europe
And it's not just the price of energy itself that's being inflated.
Due to the tight transportation of LNG, as long as there are empty ships, they will be ordered immediately. According to the data of the LNG Freight Price Assessment Agency, the price of the LNG transport ship is more than twice that of the same period last year.
Lease prices are soaring, orders for shipbuilding are already full, and South Korea, the world's largest producer of LNG carriers, has no shipyards to take on new orders until 2027. With limited capacity, the cost of new vessels has risen by about 26%.
The upper and lower chains of the LNG market have all entered a situation of mutual price increase.
You know, these extra costs can be borne by the buyer, the EU countries themselves. If the EU does not reach a tacit understanding of unified bidding and unified acquisition, it will "pry" the leverage of the global gas market to the European market.
△ Britain launched a "freeze on profits, not the people" protest
Since the EU countries are "fighting their own battles" on the issue of "open source" and cannot be coordinated and unified, the EU decided to find ways to intervene from "throttling".
More than a month ago, the EU proposed a new political agreement under which:
To ensure the security of the EU's energy supply, EU member states need to reduce their natural gas demand by 15% over the next 8 months, on a voluntary basis, based on average consumption over the past 5 years. The savings in natural gas surplus can be replenished by transfers between countries.
However, after seeing EU countries "hoarding gas" at any cost, this sign of self-endangerment made the EU have to add half a sentence after "voluntary":
In the event of a shortage of natural gas supply, the EU will take enforcement measures to reduce the demand for natural gas.
According to the EU, this was done precisely because of the fear that inconsistencies and contradictions among EU member states would distort the EU's unified market.
Afraid of what is coming, the EU market is experiencing unprecedented chaos.
The word "mandatory" has also aroused great opposition from EU member states, and some countries have directly questioned that the EU is suspected of "ultra vires".
Dong Yifan, an expert on European economy at the China Institute of Contemporary International Relations, told Tan that according to the EU's operating mechanism, it is not in line with EU law for the European Commission to unilaterally introduce a policy without the authorization of various countries and then require other countries to enforce it.
From the EU's standpoint, the original intention of the agreement is to allow EU countries to maintain the bottom line of EU energy security with the smallest possible collective concessions.
However, from the standpoint of EU member states, the policies introduced by the EU cannot actually match their own national conditions - each country's dependence on Russian natural gas is not the same, and the energy crisis caused by the Russian-Ukrainian conflict is not a crisis for some countries.
Spain's natural gas sources do not depend on Russian pipelines. Spain's Deputy Prime Minister and Minister of Ecological Transformation has said he is not willing to pay the economic price for non-Spanish problems.
Hungary, on the other hand, is the most dependent on Russian gas among EU member states – 80 percent, 15 percent cuts, and no solution to Hungary's energy crisis.
The Hungarian foreign minister bluntly criticized that "this is an unreasonable, meaningless, unimplementable and harmful proposal." ”
The European Commission, inside and out, is not flattering. But in the face of the crisis, the European Commission always has to show its role, which is why the EU will not hesitate to cross the line and propose this policy.
△ Before the meeting to finalize the final version of the agreement, the representatives of Spain and Germany had a peer-to-peer exchange
Two weeks later, 15% of the throttling protocol was passed. But the final version, it goes like this:
In the event of a supply shortage, member countries need to reduce their natural gas demand by 15 percent. At the same time, in view of the special circumstances of different member states, in order to improve the effectiveness of the implementation of the agreement, the EU exempts some or all of its obligations from some member states.
The island countries of Ireland, Cyprus and Malta are not connected to the EU gas network, and even if they save natural gas, they cannot be used by other countries, and the cost-saving obligation can be completely exempted;
The Baltic states of Estonia, Latvia and Lithuania, which are close to Russia, have not yet officially transferred from the Russian grid to the EU grid, and forced gas restrictions may lead to direct interruptions in power supply, and their obligations can be exempted.
Countries whose natural gas reserve rate exceeds the target, or whose energy structure is heavily dependent on natural gas and whose natural gas consumption has increased significantly in the past year, may also be exempted from the obligation. There are many countries that can be included in this article, including the Czech Republic, Denmark, Poland, Bulgaria, Greece, Slovakia and other countries.
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Counting down, the EU has a total of 27 member states, and the countries that can receive special care account for about half.
The policy was introduced, but it was a heavily shrunken version.
Evaluate this shrunken protocol from different perspectives:
For the EU as a whole, as long as any country does not implement the agreement, the agreement is meaningless, not only the preset goals cannot be achieved, but in the face of the crisis, once someone chooses to break away from the collective and protect themselves, it will plunge the collective into a vicious circle of unevenness;
For any EU member state, the risks and costs of relying solely on the other 26 member states to make concerted sacrifices in the face of the crisis are immeasurable.
This creates a very awkward situation, and the decisions made by the EU are not beneficial, whether they are based on the EU as a whole or from the individual countries.
It can be said that the compromise mechanism of the EU's joint decision-making has fallen into the prisoner's dilemma - when everyone covets the individual optimal solution, everyone can still reach a suboptimal solution, but in fact, only the most inferior solution can be reached.
This fundamentally goes against the logic of EU development.
Xu Qinhua, deputy dean of the National Institute of Development and Strategic Studies at Chinese Min University, told Tan that from the European Coal and Steel Community, to the European Economic Community, and then to the European Union, various member states are making more connections step by step to achieve the purpose of "hugging the group for warmth".
The fact that member states have chosen to join the EU is itself a natural weakness of wanting to use the power of integration to make up for the single power of each member state.
This is also the fundamental reason for the establishment of the European Union:
The underlying logic of the EU, which grew up in peacetime, is to make upward trade-offs – to move forward with the goal of maximizing common interests and to use a unified market to make up for the lack of size in member countries.
The establishment of the European Coal and Steel Community, the predecessor of the European Union, is a political and economic win-win for each member state: on the one hand, it can expand the political influence of each member state, especially the defeated countries in World War II, on the other hand, it can invest its resources, industry and other potentials in a larger unified market.
At that time, Europe had the real embarrassment of being consumed by the war, and wanted to return to the pole of the international political stage, relying on each other and learning from each other's strong points naturally became a necessary choice for Europe.
△ In 1950, then German Chancellor Adenauer (right) received the visiting French Foreign Minister Schumann (left), and after the war, France and Germany reconciled and agreed on coal and steel production and reserves, which was the basis for the establishment of the European Coal and Steel Community
Stimulated by the rekindling of war on the European continent, EU member states have long abandoned the original intention of European regional integration, they dare not hand over the "bottom card" to collective organizations, and they have started from the bottom line thinking and tried to find the "optimal solution" for themselves.
One consequence of this is that the EU's common policy can only focus on how to stop losses, not to make member states better, that is to say, the EU's common policy is not to take the smallest common multiple of the interests of each member state, but the greatest common denominator.
There is a key factor behind the fragile trust that EU countries built up through integration after World War II and was shattered in the face of the crisis – the United States.
After the end of World War II, the United States has been striving to "operate" on the European continent, treating different countries in Europe differently through the estrangement of interests, and in the process of interaction between the European Union and the United States, the orientation of each member state is different, which will also lead to its inability to form a unified will to the outside world.
The difference between EU member states and the United States has allowed the United States to find a loophole and punch the wedge into the foundation of trust among EU countries.
When the "Nord Stream-1" natural gas pipeline cannot supply gas, will the EU countries remember how the "Nord Stream-2" natural gas pipeline, which has been shut down before, was pinched by the United States to split the EU.
You know, for a long time before, the gas trade between Germany and Russia was basically no trouble.
According to the United States, Nord Stream-2 threatens European energy security. On this basis, the United States has repeatedly encouraged some EU member states to oppose the construction of nord Stream-2.
Under such provocations, an energy cooperation project eventually became a victim of geopolitics.
This is just a microcosm of the US involvement in the EUROPEAN Union.
Not only that, but the United States has further divided European countries through various circles.
It is worth noting that on the same day that the Russian side announced that the Nord Stream-1 pipeline would not be restored as scheduled, the G7 countries led by the United States had just announced that they had agreed to impose a price cap on Russian oil.
Oil is followed by the European Union, which is considering a price cap on Russian gas. Russia responded that once the EU made such a decision, It would no longer supply gas to Europe.
I don't know how those EU countries that are still busy with natural gas feel after seeing these two news?
Today's EU pays a greater price than energy shortages – the failure of collective decision-making.
Winter is approaching, and the regression of European integration is a greater crisis than energy shortages.
Source: Yuyuan Tan Tian