Following the bitter fruit of the United States, can Europe survive the winter safely

Reference News Network reported on November 19 (text / Kangyi) Price soaring, enterprise bankruptcy, people's livelihood difficulties, economic slowdown... Nearly nine months after the outbreak of the Ukraine crisis, the European Union blindly followed the United States to impose multiple rounds of sanctions on Russia, causing bitter results, the road to green transformation was frustrated, and it was unable to extricate itself from the energy crisis. The United States, on the other hand, took advantage of the opportunity to make a big profit, turning the "European crisis" into "the American opportunity", making Europe more and more embarrassing.

Europe's energy shortage The United States took advantage of the fire

Winter is approaching, and northwestern Europe, the Mediterranean Sea and the Iberian Peninsula are suddenly flooding with American LNG ships. As natural gas prices soared, U.S. energy companies and traders made a lot of money. Tanker tracking data showed that a total of 87 cargo ships loaded with liquefied natural gas departed from U.S. ports in September, 70% of which sailed to Europe.

"Almost crazy" and "incredibly profitable" - said energy expert Laurent Segren and Felix Booth, LNG analyst at the British consulting company Voteksa. According to their calculations, when natural gas prices were high in August, a single shipment could net about $100 million to $200 million.

Shortage of energy supply, looking for gas to save energy; Inflation has repeatedly reached double digits; Economic recovery is hopeless and sliding to the brink of recession... As the backlash brought about by multiple rounds of sanctions against Russia intensifies, European countries also have to face up to the serious consequences of following the United States.

An elderly man walks the streets of Athens, Greece, on October 6. (Photo by Leftrice Pacharis)

At the same time, the euro's exchange rate against the dollar fell to a 20-year low due to the Fed's aggressive interest rate hike policy, pushing up dollar-denominated commodity prices and bringing high bills to Europe. Under the energy crisis, European industry is in the dilemma of enterprise relocation and industrial transfer, while the United States is becoming the main destination for capacity with lower energy prices and subsidies.

As the Ukraine crisis continues to unfold, the American eagle, which Europe regards as a savior, turns out to be a vulture. Observers point out that in the long run, the EU still fails to take energy security into its own hands, but has aggravated the United States' binding on Europe.

In the face of the United States' robbery, French President Emmanuel Macron publicly denounced at a press conference after the EU summit, saying that the United States has lowered energy prices in the domestic market but supplied natural gas to the European market at record prices, which is a double standard, "involving the sincerity of transatlantic trade." As an energy producer, he said, the United States has reaped real excess profits from geopolitical battles.

In addition to France, Germany, which relies heavily on energy imports, has also complained. German Deputy Chancellor and Minister of Economy Habeck also alluded in an interview with the media that the United States and other "friendly" countries supply gas to Germany at exorbitant prices and take advantage of the Ukraine crisis to make a fortune. Hungarian Prime Minister Orban was even more blunt in saying that Europe used sanctions as a weapon, but hit itself in the foot, "it's time to discuss the consequences of sanctions against Russia with the United States."

The measures are a drop in the bucket and the people are full of complaints

To reduce expenses, workers at a ceramics factory in central Italy shifted their working hours to early mornings when energy prices were lower. While the children are still asleep, the parents have left for work early... European Commission President Ursula von der Leyen spoke with emotion in his State of the Union address.

This is what she calls an "example" of Europeans actively coping with the energy crisis, and it is also the real situation in which Europeans are forced to adapt to the new reality. French Minister of Economy and Finance Le Maire said that the energy crisis is comparable in degree and intensity to the first oil crisis. Orban pointed out that under the large-scale energy crisis, Europe is "slowly losing blood and dying".

In response to the energy dilemma, many European governments have introduced a series of subsidies, tax reduction policies, windfall profits taxes on energy companies, and measures such as limiting energy prices. But a drop in the bucket still cannot guarantee a safe winter in Europe.

Compared to before the pandemic, the price of natural gas in Europe has risen more than 10 times. Even with a brief recent decline, it remains at all-time highs and well above the long-term average. Affected by this, people's purchasing power has seriously declined, and consumer confidence is at a historical low. At the same time, the surge in costs has spilled over into production, leading to a decline in industrial output and unprecedented fears that Europe's economy is about to fall into stagflation.

According to a study published by Allianz Trading, energy-intensive companies such as paper, metallurgy, machinery and mining have been hit hard in Europe. If the energy crisis intensifies, the bankruptcy rate of European companies could be as high as 25% by 2023.

Recently, strikes and protests have broken out in many European countries. In September, tens of thousands of Czechs rallied to oppose the European Union and NATO's energy sanctions against Russia, demanding that the government curb electricity prices and ensure security of supply. In early October, Germans gathered outside the parliament building to express their dissatisfaction with the government's energy policy and call for the lifting of sanctions against Russia. According to the latest poll results released by Hungary, 66% of respondents believe that sanctions against Russia have hurt European countries even more.

At the same time, due to the large differences in the energy structure and different needs of European countries, the government first "takes care of itself" in the face of the crisis, and the lack of unity has also led to internal contradictions, and joint measures to deal with the energy crisis have been delayed for a long time.

The energy problem always seems to be linked to the fate of Europe. In the past, European countries came together because of coal and steel, and now they are gradually divided due to oil and gas differences. The energy crisis triggered by sanctions is like a mirror, and Europe is reflecting it in an increasingly bizarre and complex color. As Pavel Zeka, a policy fellow at the European Council on Foreign Relations, puts it, the coming winter could freeze Europe's sense of shared belonging and trust in each other.

Policies are frequently reversed, and the energy transition is blocked

In response to energy supply tensions, a number of European countries that have strongly called for coal abandonment have successively reopened coal power plants and supported coal power projects. EDF will restart all nuclear reactors in a shutdown state to accelerate nuclear power construction; The European Parliament voted for the "green label" of gas and nuclear ...

This is despite EU officials arguing that the measures are merely "expedient" aimed at solving the problem of wintering. However, analysts pointed out that the EU's frequent "reversal" on the issue of emission reduction will not only fail to solve the root cause of the energy crisis and improve Europe's energy independence, but also affect the energy transition process, greatly reducing its "green ambition".

"The decision to restart or increase the use of thermal power plants is very problematic from a climate and environmental point of view." Tomislav Tkalets, an energy expert at the Slovenian Focus Association for Sustainable Development, told this reporter that climate experts have been calling for "decontamination" measures, while these measures in European countries are going backwards.

Tcalets is also wrong to think that the EU is "greenwashing" gas. "EU countries should make greater strides in investing in renewable energy, rather than going from coal to gas, which is just swapping one fossil for another," he said. ”

Wojko Bernard, president of the international environmental organization Alpe Adria Green, expressed understanding that the government is under pressure due to energy shortages, but said that the government has not used all possibilities to alleviate the energy crisis. "Slovenia should make better use of geothermal and solar energy before it intends to build a second nuclear power plant."

Analysts pointed out that the construction of infrastructure related to natural gas imports, the signing of gas contracts, and the guidance of funds into fossil energy and nuclear energy are all long-term plans, which cannot be said to change, and will inevitably crowd out the resources of the green energy transition, resulting in an increase in dependence on fossil fuels.

Jane Rossnolt, European program director at Regulatory Assistance Project, which focuses on the energy transition, points out that once fossil fuel infrastructure is in place, companies will want to use these assets for as long as possible to ensure a return on investment.

In any case, this winter is destined to be difficult for Europe. In the face of soaring prices and soaring costs, European companies and people can obviously "wait" for the energy transition that the EU says is still "in time". (Contributors: Tang Ji, reporter in Paris, Zhou Yue, reporter in Ljubljana, Zhu Sheng, correspondent in Berlin, and Pan Geping, correspondent in Brussels)

Source: Reference News Network