EU proposes mandatory national gas cuts

  • : Coal, Natural gas
  • 22/07/20

Industries in the EU could face mandatory gas consumption cuts if member states agree to a proposal by the European Commission.

The proposed legislation sets targets for all EU states to voluntarily reduce gas consumption by 45bn m³ — or 15pc — in August 2022-March 2023. The 15pc reduction is compared with countries' average consumption between 1 August and 31 March during the past five years. But the commission could, after "consulting" with countries, trigger an EU alert that would impose mandatory gas demand reductions.

Under the proposal, EU countries must update national emergency plans by the end of September. Member states would have to report back to the commission every two months, and would have to show that national measures are reducing domestic demand.

Commission executive vice president Frans Timmermans underlined that households remain protected, with voluntary cuts for other sectors and an emergency legal option for mandatory cuts at a later date if needed following a full cut-off by Russian state-controlled Gazprom.

Commission president Ursula von der Leyen called on member states to approve the emergency provision, which she said would give officials powers to propose "measures appropriate to the economic situation, in particular if severe difficulties arise in the supply of certain products, notably in the area of energy".

The EU needs to respond to Russian "blackmail" and the "likely scenario" of a full cut in Russian gas deliveries by securing other "trustworthy" supplies and acting "in unity" to cut demand, von der Leyen said.

EU member states normally have to approve measures under a qualified majority procedure, whereby no single European country can veto or unduly delay adoption — as Hungary did over further sanctions against Russia. EU measures aim to act in the common interest of Europe, "in a spirit of solidarity" between member states, but may face opposition from countries pursuing national interests.

Hungary has emergency measures that restrict energy exports to other EU countries. And Hungarian foreign minister Peter Szijjarto has confirmed negotiations with Gazprom to increase deliveries to Hungary through Serbia.

The commission also noted possible exemptions to pollutant and CO2 emissions rules to help power plants and refiners switch away from Russian fossil fuels. Without a full cut of Russian supplies and sufficient measures by EU countries, the commission's plan would constitute guidelines for EU states to further reduce gas demand without binding rules.


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24/05/02

Shell's 1Q profit supported by LNG and refining

Shell's 1Q profit supported by LNG and refining

London, 2 May (Argus) — Shell delivered a better-than-expected profit for the first quarter of 2024, helped by a strong performance from its LNG and oil product businesses. The company reported profit of $7.4bn for January-March, up sharply from an impairment-hit $474mn in the previous three months but down from $8.7bn in the first quarter of 2023. Adjusted for inventory valuation effects and one-off items, Shell's profit came in at $7.7bn, 6pc ahead of the preceding three months and above analysts' estimates of $6.3bn-$6.5bn, although it was 20pc lower than the first quarter of 2023 when gas prices were higher. Shell's oil and gas production increased by 3pc on the quarter in January-March and was broadly flat compared with a year earlier at 2.91mn b/d of oil equivalent (boe/d). For the current quarter, Shell expects production in a range of 2.55mn-2.81mn boe/d, reflecting the effect of scheduled maintenance across its portfolio. The company's Integrated Gas segment delivered a profit of $2.76bn in the first quarter, up from $1.73bn in the previous three months and $2.41bn a year earlier. The segment benefited from increased LNG volumes — 7.58mn t compared to 7.06mn t in the previous quarter and 7.19mn t a year earlier — as well as favourable deferred tax movements and lower operating expenses. For the current quarter, Shell expects to produce 6.8mn-7.4mn t of LNG. In the downstream, the company's Chemicals and Products segment swung to a profit of $1.16bn during the quarter from an impairment-driven loss of $1.83bn in the previous three months, supported by a strong contribution from oil trading operations and higher refining margins driven by greater utilisation of its refineries and global supply disruptions. Shell's refinery throughput increased to 1.43mn b/d in the first quarter from 1.32mn b/d in fourth quarter of last year and 1.41mn b/d in January-March 2023. Shell has maintained its quarterly dividend at $0.344/share. It also said it has completed the $3.5bn programme of share repurchases that it announced at its previous set of results and plans to buy back another $3.5bn of its shares before the company's next quarterly results announcement. The company said it expects its capital spending for the year to be within a $22bn-$25bn range. By Jon Mainwaring Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

US southbound barge demand falls off earlier than usual


24/05/01
24/05/01

US southbound barge demand falls off earlier than usual

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US Fed signals rates likely to stay high for longer


24/05/01
24/05/01

US Fed signals rates likely to stay high for longer

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FERC OK’s Virginia Transco gasline expansion


24/05/01
24/05/01

FERC OK’s Virginia Transco gasline expansion

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US gas industry pins hopes on AI power demand


24/05/01
24/05/01

US gas industry pins hopes on AI power demand

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