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Europe appears to have avoided an energy catastrophe this year thanks to a relatively mild winter. Reducing its reliance on Russian oil is viewed as a positive long-term step for Europe, but experts say that a more typical winter next year could send natural gas prices soaring and put pressure on the entire system.
That’s not the only concern. Straight Arrow News contributor Peter Zeihan warns that various factors like declining demand indicate that an energy crisis in Europe is inevitable.
Excerpted from Peter’s April 13 “Zeihan on Geopolitics” newsletter:
Horrible views today up on the Isthmus Peak Trail in New Zealand. Europe’s energy situation looked pretty dire last year as concerns began to mount over the impending winter season. Thankfully they dodged a bullet this year, but how many more bullets can the Europeans dodge? The issue with Europe’s lucky streak is that none of what saved them can be replicated.
Industrial demand has already plummeted, and maintaining these levels would have detrimental effects. Paying through their teeth for liquified natural gas isn’t sustainable. And unless the Europeans have Mother Nature on speed dial, they can’t expect another moderate winter like this year. Unfortunately for all of us, current global energy supplies are likely the best they’ll be for years to come. So the Europeans need to say thanks for the extra time and head back to the drawing board to get out of this pickle.
