Russian natural gas exports to Europe break record high

30 December 2013 16:33 Source:ICIS

Russian natural gas exports to Europe hit a record high in 2013 year amid lower supply from competitor sources and attractive LNG prices in Asia, according to Russia’s Gazprom Export.

Exports to Europe in 2013 reached 161.5 billion cubic metres (bcm) according to preliminary figures, a year-on-year increase of 16%, Gazprom Export said on Monday.

The company also confirmed that the average price of European exports over 2013, at $380 (€275)/thousand cubic metres (kcm) was down 5.5% year on year.

In 2012, Russian gas exports to Europe came to 138.8/bcm at an average price of $402/kcm.

The countries that saw the biggest increase of gas from Gazprom were Germany, with an increase of more than 20%, Italy by more than 60% and the UK which increased by about 50%. The exporter attributed increases into Germany to natural market growth while Italy is making up for very low take-up during 2010-2012.

As a general rule, however, demand for gas as a source for power generation remains subdued. Year-on-year increases in demand have come from colder weather earlier in 2013. Demand for gas for storage injection over the summer was also up from 2012 with stocks at unusually low levels.

“For the general increase in all markets, the reasons are combined. One is falling supplies from other sources – all importers to Europe saw a fall in their supply volumes in 2013, except for Russia and the Netherlands. Another reason is that LNG has been lured away from Europe by more attractive prices. Consequences of the Arab Spring also added to the shrinking supply,” said Gazprom.

In November, Gazprom increased deliveries through Nord Stream, as flows were lifted through the NEL pipe which reached full capacity at the start of the month.

The previous record high in exports to Europe was 158.8bcm in 2008. Miriam Siers

By Miriam Siers