UA Norwegian giant has discreetly replaced a Russian colossus on the European gas market. Two years after the start of the war in Ukraine, Equinor dethroned Gazprom and established itself as the strategic supplier of the Old Continent. Its energy security is thus less threatened by geopolitical hazards. However, it remains dependent on the Stavanger company and other local producers for 30% of its needs, a little less than the 35% of the Russian public group. This shows their importance, particularly for Germany, which thanked Oslo for mobilizing to replace Gazprom in a few months.
Norwegian Energy Minister Terje Aasland repeats that his country will be “a stable, long-term supplier” for decades to come. There is no reason to doubt it. And there is no great risk that Norway will invade its Swedish neighbor… However, a leak in the Equinor liquefied natural gas (LNG) plant at Hammerfest on April 23 was enough for its shutdown to cause a surge in spot price.
A phenomenon already observed a year earlier, during long maintenance operations, in the largest European LNG plant, located above the Polar Circle. If a dominant player is in difficulty, the markets have the unfortunate tendency to overreact.
The country’s gas revenue reached 120 billion euros in 2022 and 55 billion in 2023, feeding the extremely wealthy sovereign fund intended for future generations, already full of petrodollars. This earned it the accusation of “profiting from the war” and taking liberties with its environmental commitments, by boosting its production of fossil energy.
Putin’s adventurism
Norway benefited from an emergency situation, its proximity to the Twenty-Seven and its previous position as the second supplier to the European Union. The ballet of German leaders and the Commission, who in Oslo, who in Stavanger, who on the giant Troll deposit, attest to the crucial role of the small Scandinavian kingdom.
It will probably not last, even if this source of supply remains important. The production of new gas liquefaction trains, in the United States and Qatar in particular, will arrive on the market within two years and should give the Europeans greater room to negotiate better prices. In the meantime, Equinor is doing everything to continue to play a key role as a reliable supplier. Precisely the one endorsed by Gazprom, from the 1970s until the Russian-Ukrainian conflict.
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