Miriam Elder has a good one in the FT today about the problems at Gazprom, no doubt worsened by European incoherence:
“If the company cuts [its investment] too much, it may be harmful for them if demand surges. They will miss an opportunity,” says Fatih Birol, chief economist at the International Energy Agency. “It may give an impetus to European governments to look at other options,” he says, including renewables and nuclear energy.
Gazprom says it will keep investments down as long as European demand remains in a slump. “Why invest money in what is not in demand?” Gazprom deputy chief executive Alexander Ananenkov said when first floating the Bovanenkovo delay in June. (…)
In the short term, that should have little effect on European supply, as demand remains low and work at the massive Bovanenkovo field is close to completion, says Jonathan Stern, director of gas research at the Oxford Institute of Energy Studies. The long-term is a different story, but one with a similar narrative to the main discussion pre-crisis.
“Europe is fundamentally confused,” he says. “It doesn’t know whether it wants more Russian gas because it can’t rely on other people, or less because it can’t rely on Russia.” That could lead to an increased push for alternative sources and liquefied natural gas, as well as the Nabucco pipeline to deliver central Asian gas to Europe.