Austria won a case from Gazprom, but without gas

Alexey Belogoryev, Research and Development Director of the Institute for Energy and Finance, commented to the Neft and Capital internet portal on the consequences of the Russian gas supplies termination under the contract between Gazprom Export and the Austrian company OMV.

As Alexey Belogoryev said, it is unlikely that OMV did this without looking at the Austrian government. Surely all this was agreed in advance with the authorities, who decided that the country was ready for both a short-term physical shortage of gas and an increase in spot prices.

"Austria now has large gas reserves (enough for a whole year). The problem is that, from a technical point of view, it is impossible to select hydrocarbons so quickly and pump them to the consumer. In winter, and only on peak consumption days, there will be a physical deficit of 5-10%. The country will not freeze, but it will supply less energy and heat to households, and less gas to industrial enterprises," the expert explained.

He added that Vienna really has the opportunity to organize reverse deliveries from Greece, Germany, and Italy. The problem is that these will be intermediaries who purchase LNG and after regasification and transit, the cost of gas for the Austrian end user will be clearly higher than usual.

"There is a question here whether LNG terminals in other countries will have the right amount of gas for Vienna. For this reason, an increase in the cost of gas on the spot from 20% to 30% is possible on the exchanges in Germany and Austria. That's if nothing out of the ordinary happens.

And it's bad for everyone. For Gazprom, the loss of exports of 6 billion is not fatal, but it is still bad with current supplies. Austria will have to buy LNG from intermediaries. Slovakia, if supplies through Austria physically stop, will have to urgently look for about 3 billion cubic meters per year. At the same time, it makes no sense to fight for Ukrainian transit, which may stop in 2025," Alexey Belogoryev believes.