The energy crisis threatens to shatter European unity, warns the head of the IEA

The head of the International Energy Agency has warned European countries against an energy security rush this winter that threatens to shatter EU unity and spark social unrest.

Fatih Birol, executive director of the IEA, said he feared “a wild west scenario” if European countries moved to restrict their trade or stop partnering with neighbors amid growing anxieties over fuel shortages this winter. .

“The implications will be bad for energy, bad for the economy, but extremely bad politically,” Birol said Thursday in an interview with the inaugural Global Clean Energy Action Forum in Pittsburgh. “If Europe fails this energy test, it can go beyond the energy implications.”

European countries have become more contentious as they try to maintain a united front amid the surge in energy prices that have brought the continent to the brink of an economic recession. But the growing crisis has sparked fears that some countries may cut collateral deals for Russian supply or restrict energy exports to their neighbors.

There were “two scenarios,” said Birol, whose Paris-based enforcement agency is funded primarily by OECD members. “The EU and its members will work in solidarity, supporting each other. . . or there is another scenario, if everyone is for himself.

“One of the founding values ​​of the EU is solidarity. It will negatively affect the weight of the EU in the world, “Birol said of the latter scenario.

Norway’s northern neighbors last month blew up Oslo for “selfish” behavior as it considered suspending electricity exports while filling its hydroelectric reservoirs.

Andreas Bjelland Eriksen, secretary of state of the Norwegian oil and energy ministry, denied that he would stop exports, however, telling the Financial Times that the country was simply “prioritizing replenishment for the same reason that the ‘Europe is filling up its gas (storage) “.

The EU faced opposition from Hungary and some other Member States as it stepped up sanctions against Russia in response to its invasion of Ukraine.

Birol also warned against European complacency after the continent managed to stockpile natural gas before the winter months when demand peaks.

Even if the continent avoids new “negative surprises” in its gas supply, such as a colder-than-expected winter, Europe would suffer “bruises” in the coming months, Birol said, including economic recession and “significant damage to gas budgets. families”.

The crisis for Europe will also last until 2023, he said, given stagnation in global supply and the likelihood of increased competition for liquefied natural gas from a recovering China and other importers.

“When we look around, there aren’t many new gases [projects] Arriving . . . And the Norway, Algeria, Azerbaijan oil pipelines are close to their maximum capacity. It will be another difficult time, “she said.

But Birol was also adamant that Moscow had “already lost the energy battle” with Europe as the continent sought alternative suppliers.

Most of Russia’s oil and gas exports had gone to Europe before the war, he said, but now it was over.

“Russia has lost a good customer, and forever. This client paid the money on time and didn’t create any political problems, ”Birol said.

The head of the IEA has rejected Russian efforts to replace the European gas market with exports to Asia. “You don’t sell onions in the market. You have to build pipelines, infrastructure, logistics. It will take at least 10 years, “he said.

Russia would also have difficulty maintaining production as sanctions restricted its access to Western technology and the capital it needed to continue repairing old oil and gas fields, Birol said.