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Sep 17, 2022
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The US is bending its line, leaving Europe without oil and gas

The US is bending its line, leaving Europe without oil and gas

Photo: IMAGO/Panama Pictures/TASS

Representatives of the American industry refused to help Europe increase the supply of oil and gas in the coming winter, writes the British Financial Times.

U.S. shale executives, with vast reserves of oil and natural gas that could be used to cushion Europe’s energy crisis, will not be able to ramp up supplies fast enough to avert a winter shortage, as U.S. LNG and oil export opportunities to the EU are close to zero, according to the publication. have reached their maximum.

“It doesn’t look like the US can produce even more. Our production is what it is, ”quotes the publication of the head of the private equity group Quantum Energy Partners, one of the largest investors in the shale field. Wil Vanloch.

Executive director of the investment company Kimmeridge Energy Ben Dellin turn, he clarified that entrepreneurs who invest their money in oil and gas companies will not seek to increase production, since it is known that when less raw materials are produced, they are sold much more expensively.

The authors pay special attention to the fact that these statements come against the backdrop of fears that the fall in Russian exports will lead to a rise in oil prices. Thus, the situation will become more complicated when the EU embargo on Russian oil supplies comes into full force.

“There will be no help for Europe, neither from oil nor from gas,” Vanloch warns.

It turns out interesting: we introduce sanctions together, but tobacco separately? That is, the US is forcing Europe to abandon Russian oil and gas without offering anything in return? Did they not understand that this would lead Europe to an acute crisis? Or was this the goal – to weaken the economy of Europe?

But did the Europeans understand that they had nothing to expect from the United States, that promising does not mean getting married? Did the revelations of the shale workers to the British publication become a discovery for them? Or did they think that American reserves were limitless?

How huge are these reserves in reality? Or was it a soap bubble from the very beginning?

— The proven oil reserves of the United States are 8.2 billion tons. According to this indicator, the States are in 9th place in the world. For comparison, the same indicator in Russia is 14.8 billion tons, explains Deputy General Director of the National Energy Institute Alexander Frolov
– As for gas, according to BP, the proven reserves of the United States amount to 12.6 trillion cubic meters – the fifth place in the world (in Russia, 37.4 trillion cubic meters – the first place). The very posing of the question of the possibility of increasing supplies by American companies is more than sly. Promises to increase something somewhere are given by American politicians. But – here’s a surprise! – they do not have a single tool in their hands that would allow them to influence the direction and volume of hydrocarbon supplies from the United States. That is, politicians make promises without asking companies about their plans. And the companies did not promise anything to anyone.

“SP”: — Have the Americans increased production after the fever in the market in the spring of 2020 and the pandemic?
– Of course, they increased it. Thus, oil production reached 12.1 million barrels per day, 1.5 million barrels per day more than at the beginning of 2021. But 1 million barrels less than the March 2020 peak.

“SP”: “Then why can’t supplies be increased quickly?” And how soon, in theory, could they increase them, if at all possible?
— And why should companies increase some deliveries somewhere? They did not give any guarantees to anyone, they did not sign any contracts and did not conclude any agreements.
In principle, the technical capacity to export liquefied natural gas from the United States has increased by 16-20 billion cubic meters this year. m. This was within the expectations, which were based on the companies’ investments in production facilities. Building LNG plants is a very expensive pleasure: about $1 billion for 1 million tons of capacity.

“SP”: Will Americans have enough on their own? How long can they give up Russian oil? Or will they buy somewhere else? Where?
— The US is deeply dependent on crude oil imports. They replaced imports from Russia with imports from other sources. And Russia took its oil to where a market window arose due to the redistribution of flows.

“SP”: – How do you think the Europeans will get out? Did they have high hopes for the US, or do they have fallbacks?

– If Russian volumes do not leave the world market, then another redistribution of flows will take place. Someone will remove their volumes from other markets and take them to Europe, and we will occupy the market windows formed during this.

But if Russian volumes go away, there will be an acute shortage of oil on a global scale, prices will begin to grow uncontrollably.

Director of the EAEU Institute Vladimir Lepekhin I am convinced that there is no problem for Europe to survive the winter.

– Somewhere there will be a little lack of heat, somewhere water. It is not critical, and even more so not fatal. As a result, those who need it will buy both heat and water. And for those who don’t really need it, they’ll endure it. You have to look in your direction. But will Russians survive this winter with rising prices, with debts on housing and communal services and mortgages, with closing businesses and inadequate decisions of officials.

If it is more important for Europeans to kill Russia than to get gas, should we rejoice in this?

“SP”: Why, in your opinion, did the Americans not immediately say that we would not help you? Were you afraid that Europe would not go for sanctions then?

– There is no such word “help” in the Euro-American lexicon. Everyone helps each other for money. The Anglo-Saxons will profit from the problems of Europe and our problems. They did not appoint Borrell as head of the EU to help Europe.

“SP”: – Will this somehow affect the desire of the Europeans to impose an embargo? Or have they firmly embarked on the path of abandoning Russian energy sources?

– Europeans are beginning to be influenced by two things: firstly, the realization that the Anglo-Saxons are raking in the heat with their hands. All the goodies to them, but to the Europeans – problems, and, secondly, the prospect of the expansion of the Russian-Ukrainian war to the scale of a European one … Their attitude towards Russian energy carriers will not change significantly, because their attitude towards Russia and Putin will not change much.

“SP”: – To what extent, in general, can this affect relations between the EU and the USA?
– Unlike the “fraternal” peoples, Russian and Ukrainian, who managed to quarrel by showing both “candy”, the EU and the USA will not quarrel. Not because they are really brothers, but simply because they have no one to offer some kind of candy from the outside … Both the EU and the USA print their own sweets: dollars and euros. Unlike Ukraine and Russia, which really depend on the Western community.

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