The Institute for Energy Economics and Financial Analysis (IEEFA) reported a significant decrease in gas consumption in Europe, including the UK, Norway, and Turkey, in 2023. The drop in consumption to 452 billion cubic meters, the lowest in a decade, was attributed to increased energy efficiency measures and renewable energy use, marking a substantial decrease from 472 billion cubic meters consumed in 2014.
Following the onset of the war in Ukraine, the study revealed a 20% drop in European demand. This decrease was due to the cessation of Russian hydrocarbon shipments via gas pipelines, prompting Europe to turn to liquefied natural gas (LNG) transported by ship. The sales of LNG to Europe in 2022 and 2023 exceeded 170 billion euros.
During this period, Europe’s primary source of LNG imports was the United States, amounting to 75.15 billion euros. Despite the conflict, Russia still ranked second with 23.84 billion euros, closely followed by Qatar with 23.8 billion euros.
LNG deliveries from Russia to Europe saw an 11% increase between 2021 and 2023. Deliveries doubled to Spain and tripled to Belgium, while France, despite a 35% decrease in Russian LNG imports over the past year, remained the second-largest importer of Russian LNG in Europe.
Two years after the commencement of the Russian offensive in Ukraine, Ana-Maria Jaller-Makarewicz from IEEFA notes that the European energy system has become more diverse and resilient. She highlighted that Europe’s adaptation efforts have allowed it to continue reducing its gas demand, which could lead to a potential peak in global LNG demand as early as 2025, especially given the steep increase in LNG prices following the outbreak of the war in Ukraine.
