Russia’s Gazprom CEO warns of volatile future for European gas market

Russia’s Gazprom CEO Alexei Miller has issued a cautionary forecast regarding the future of the European gas market at the St. Petersburg International Gas Forum.

He emphasised the increasing volatility of gas prices and the likelihood of new price shocks and supply disruptions. Miller linked these risks to Europe’s ongoing "deindustrialization," driven by high energy prices that diminish the competitiveness of European industries compared to their global peers, Caliber.Az reports via foreign media.

He reported that gas demand in the EU and the UK fell by 11 billion cubic metres in the first nine months of 2024, with sectors such as steel, cement, and chemicals experiencing significant declines—some seeing production drop by 10 per cent over the past 18 months.

This trend has led many industrial enterprises, particularly in Germany, to shut down or relocate their operations. Miller highlighted that energy costs in Europe are 2-3 times higher than in the US, while gas prices are 4-5 times greater, creating challenges for European companies trying to compete globally.

Looking ahead, Gazprom anticipates global gas demand to reach 5.7 trillion cubic metres by 2050, fueled by population growth and digitalisation, with most of the increase coming from countries like China, India, and Russia, along with rising demand from the Global South. 

He also noted a slowdown in US gas production due to depleting shale deposits and increasing domestic demand, along with the surprising trend of the US boosting gas imports from Canada, signaling that even the world's largest gas producer is encountering supply difficulties.

Miller highlighted that Russia is recognising new opportunities for collaboration with global organisations such as BRICS, which could influence the future of the gas market. Recently, Russia's Finance Minister Anton Siluanov stated that the country is working to decrease its reliance on unstable income sources and lessen its dependence on oil and gas.

By Naila Huseynova