Who pays for the redistribution of the energy market, which began because of the war with Iran. Part 2

The escalation around Iran exposes a new bill to the global economy. The crisis has gone beyond the oil market, the impact of which we wrote about in the first part. Disruptions in the supply of liquefied natural gas from Qatar have rocked both Europe and Asia, hitting the electric power industry and industry. The energy shock spreads rapidly throughout the entire production chain. Who will pay for it in the end — Izvestia figured it out.

The fourth bill is gas

- If the first signal of the energy crisis, which arose due to the escalation in the Middle East, was a jump in oil prices, then the second wave of the impact fell on the gas sector. This is a more nervous market because gas tolerates logistics disruptions worse than oil: LNG supplies are tied to the infrastructure of pipelines and terminals. Therefore, disruptions in one region quickly turn into a global shock.

- Qatar, one of the largest suppliers of liquefied natural gas in the world, plays a special role in this story. The country accounts for about 20% of global LNG exports, all of which pass through the Strait of Hormuz, and there are no alternatives to this route. In early March, the state-owned QatarEnergy company shut down the world's largest export terminal in Ras Laffan after the Iranian attack. At that time, gas prices in Europe reached the highest level since the beginning of 2023. During the auction on March 9, they exceeded the mark of $ 800 per thousand cubic meters. Then, after the announcement by US President Donald Trump about the imminent completion of the operation against Iran, the cost was adjusted at the level of $ 500-600 per thousand cubic meters.

- European countries have been particularly sensitive to these events. After the reduction in Russian gas supplies, the EU became more dependent on LNG. If up to 2022 it accounted for about 19% of European gas supplies, then in 2026, according to forecasts, it will be 45%. This is equivalent to 174 billion cubic meters, or about 1,800 LNG tankers.

- Now Europe has to fill its storage facilities before the next heating season. At the same time, this year the stock level is lower than usual — it is expected that by the end of March the storages will be filled by 22-27%, with an average over five years of 41%.

- According to some reports, the available gas reserves in the British storages will be enough for just a few days. In such circumstances, traders began to inflate prices for the British market, realizing that the country had no choice but to outbid the offers of European competitors. London currently pays the highest wholesale price for gas in Europe. In addition to Britain, Italy and Germany are the most dependent on gas imports in Europe.

- To replenish the storage facilities, Europe needs to purchase 67 billion cubic meters — 17 billion cubic meters more than last year. It will receive part of the volume through pipelines from Norway, Algeria, and Russia, while the rest will be LNG. According to Reuters calculations, taking into account the price increase for the entire volume of 67 billion cubic meters, the overpayment will amount to $13.6 billion — the total check will be $ 40 billion. And this is only the cost of gas for storage facilities. This amount does not include the costs of LNG transportation, regasification, and insurance. In other words, there is no physical shortage of gas yet, and Europe is already receiving billions of dollars in bills to bring reserves back to a safe level. Even if the conflict ends right now, it could take months to return to normal supply cycles. Goldman Sachs analysts have already raised their forecast for gas prices in Europe for April to €55 per megawatt hour, which is equivalent to $670 per 1,000 cubic meters. In the event of supply disruptions lasting more than two months, experts predict an increase in gas prices to $1,200 per 1,000 cubic meters.

- The loss of Qatari supplies has led to a struggle for free fuel shipments. This is evidenced by the change in the routes of several gas carriers heading to Europe — they suddenly turned towards Asia. This region, as a rule, consumes more gas during the hot summer months than Europe, due to the more intensive use of air conditioners, which creates an urgent need for gas supplies for Asian energy companies. Therefore, Asia is no less vulnerable in this story than Europe. In the first half of 2025, 85% of the LNG passing through Hormuz went to Asian markets. Moreover, China and India collectively took almost 45% of this flow. That is why Asia is starting to attract LNG shipments from the global market. This indicates a change in physical supply flows and increased competition, which threatens to increase prices again.

- It is almost impossible to replace LNG supplies through the Strait of Hormuz, especially if shipping is limited until the summer. Two other major suppliers, the United States and Australia, do not yet have spare capacity to increase exports: their factories are operating at almost full capacity. Launching new projects will not be able to quickly compensate for the lost volumes. As a result, forecasts for an excess supply of LNG this year are unlikely to be justified: due to the downtime of the Qatar complex, the market may quickly turn into a deficit.

- Against this background, Russian supplies of liquefied natural gas are becoming a valuable source for the market. However, most of the Russian LNG has already been contracted, so it is not yet possible to replace Qatari gas with supplies from the Russian Federation.

- Until 2022, Europe received about 155 billion cubic meters of pipeline gas per year from Russia. In 2025, the volume of supplies was estimated at 18 billion cubic meters. Taking into account LNG, Russian exports to the EU amounted to approximately 40 billion cubic meters. The only existing pipeline now is the Turkish Stream. If supplies on other routes were resumed — which would require rebuilding infrastructure and making a number of policy decisions — then the impact on the market could soften. Thus, if Europe received at least 50-70 billion cubic meters of Russian gas per year, which is comparable to half of Qatar's annual LNG exports, the pressure on European prices would noticeably decrease, and some shipments of liquefied natural gas could be redirected to the Asian market. However, this will not solve the overall problem. Pipeline gas cannot completely replace LNG supplies to Asian markets, which are directly dependent on offshore supplies. And Europe will not be able to completely abandon the purchase of LNG, since its energy system has been rebuilt specifically for it — new terminals have been built, long-term contracts with suppliers have been concluded. Therefore, according to the gas bill, Europe is also paying for the choice of a model vulnerable to crises.

The fifth bill is electricity

- One of the most important links of the current crisis is that the gas market does not live separately from the energy systems. Despite the general trend of switching to renewable energy sources, gas generation still occupies a significant share in the EU and Asian countries. For example, in Italy, gas is used to produce about 45% of electricity, in the Netherlands — 35%, in Japan — about 30%.

- In addition to generating electricity, in many countries, gas-fired power plants provide so-called balancing generation, promptly increasing or reducing the volume of generation, depending on how much energy was obtained from installations powered by wind and solar. At the same time, the marginal pricing rule applies in the European market — the price is set by the most expensive station, which is necessary to cover demand. As a rule, these are gas-fired power plants.

- Because of this pricing system and against the background of the war with Iran, electricity prices in Europe are in a fever. For example, on March 4 in Denmark, the wholesale price for one megawatt of electricity was €26 at 14:00 local time and almost 20 times more — about €450 — at 17:45: if during the day customers had access to abundant electricity produced using solar panels, then in the evening they have to buy electricity. which is produced at gas-fired power plants. A similar pattern is observed in other major markets — in Germany, Belgium and the Netherlands. In Japan, during the first few days of the war, the price of electricity jumped by a third.

- The energy crisis is inevitably turning into an industrial one. Due to lower energy costs in the United States and in a number of countries in the Middle East and Asia, some of the new European projects in the chemical industry and metallurgy are being transferred there. In the long-term scenario, the emerging energy crisis may become a catalyst for further European deindustrialization. This will become another bill that entire sectors of the European economy will have to pay — with a loss of investment, fewer jobs and a reduction in industrial production.

- As a result, in the event of an oil shock, the driver pays first, in the event of an increase in gas and electricity prices, the entire economy already pays. As a result, consumers are surprised to find that the war is far away, and new increased bills for electricity, heating and more expensive goods are already at home.