Energy crisis is being exacerbated by inter-regional competition for gas: WEC CEO

Angela Wilkinson, the secretary-general and CEO of the World Energy Council (WEC) said that the present energy crisis in Europe is not driven by geopolitics, but rather by a combination of factors, including the unexpected recovery of demand and countries stealing market share away from one another.

As per the reports of Sputnik, Wilkinson further stated that what's happening in Europe, China, Oceania, Latin America and North America is a combination of a surprise in the recovery of demand where it's shifted after the COVID problem as they emerge from lockdown. According to Wilkinson, more energy is delivered more quickly, yet various outcomes may be expected in different areas. Asia's gas consumption has skyrocketed. This is depriving Europe of a market share.

Current energy crisis driven by various factors

Gas providers all across the world, according to the WEC official, have resorted to Asia in search of higher pricing. She said that the long-term contracts encompass the majority of gas contracts, accounting for 80% of the total. All of these things are provided, and all of their needs are met, yet Europe failed to invest in a dust buffer during COVID because it did not believe it was necessary. According to Sputnik, Wilkinson also said that they are seeing more extreme weather, and as a result, they are more vulnerable. She believes that the systems must adapt.

Wilkinson went on to say that the current scenario is different from previous energy crises and is a new occurrence, emphasising the significance of looking ahead and learning to balance issues of energy security, justice and sustainability. Due to an economic resurgence following months of COVID limitations, gas prices have been rising around the world as demand outpaces supply. To make issues even more complicated, Asia's shift away from coal and toward gas has increased buyer competition. As a result, gas futures in the Dutch TTF market soared to nearly $2,000, which is a new European high, according to Sputnik.

Gas price surges to a record high in Europe

Prices on the European gas futures market have more than quadrupled in recent weeks, owing to a supply shortage triggered by last year's abnormally long winter, governments' failure to replenish supplies throughout the summer, market speculation and lower-than-expected returns on green energy investments. The increase in prices has affected the United Kingdom particularly hard.

(Image: Twitter/@WECouncil)