Europe’s two largest suppliers of pipeline gas, Norway’s Equinor and Russia’s Gazprom, have lost market share for the first time in at least four years amid a tripling LNG imports into the region over the past 10 months.
According to a Reuters report, LNG imports into Europe have jumped due to lower than expected spot demand from Asia, which helped to send European gas prices to 10-year lows and filled European storage facilities to multi-year highs.
Data compiled by Refinitiv showing Norwegian, Russian and LNG sources market share changes is the latest example of how LNG is transforming Europe’s gas market.
The share of LNG in gas supplied to western and central Europe increased to 14% between October, 2018 and August, 2019 from 5% in the same period of 2017-18..
Norwegian gas share dropped to 33% from 38%, a multi-year low, according to the Refintiv data.
Gazprom’s share was around the average of the past three years, edging down by 1% from the previous year to 32%. But it was the first year-on-year drop since 2014-2015, when it was hit by low gas demand in Europe.
US LNG imported into northwest Europe accounted for 2% of total gas supply into the region, also contributing to the strong increase in LNG in Europe.
Despite its market share drop, Gazprom’s total gas exports to Europe rose, as the region imported 9% more gas from October to August, compared with the same period in 2017-2018.
“Most of the increase, which we see in Russian supply this year came to Slovakia and the Czech Republic - countries which do not have direct access to LNG and which need to prepare their storages in case transit via Ukraine stops from January, 2020,” said Marina Tsygankova, gas market analyst at Refintiv.
The gas transit agreement between Russia and Ukraine is due to expire at the end of this year. The lack of progress in talks has spurred Europe to stockpile gas to prevent possible supply disruption during the winter months.
This analysis was based on gas volumes for Germany, France, Austria, the Netherlands, Britain, Belgium, the Czech Republic and Slovakia from October to August over the past six years, Reuters explained.