International Gas Union, against expensive gas investing in production and infrastructure

To curb the run in the price of natural gas, fueled by the war in Ukraine and the tensions between Europe and Russia, investments must be increased. Since the start of the Covid pandemic, investments have decreased, making the situation on the gas market progressively more tense. We must not react to this situation with anti-market measures, such as the imposition of price caps, but by investing in production and infrastructure, including terminals to liquefy and regasify natural gas, diversifying supplies and continuing on the path of transition. energy and decarbonisation. This is what is indicated by Tatiana Kahnberg, head of public affairs at the Igu, the International Gas Union, the international organization of the gas industry, which has over 160 members among associations and companies in the sector, representing over 95% of the global gas market. The current level of gas prices, Kahnberg explains to Adnkronos, “derives from a pre-existing crisis in energy prices and from a tight and tense gas market, in which the increase in demand and the scarcity of supply already left a limited room for maneuver “. A situation due to investments in the sector, which “have recorded a downward trend in recent years and which have been particularly depressed by the coronavirus pandemic”. In this scenario, the war in Ukraine was then triggered and a “significant premium” was added to gas prices due to geopolitical risks. However, this factor also applies to the entire energy and raw materials market. A positive political scenario, on the contrary, “would be important to encourage investments, strengthen energy security and further diversify sources of supply”. In particular, countries and companies in the sector should invest “in all phases of the gas supply chain, from production to transport, from storage to liquefied natural gas, to improve energy security”. Khanberg, on the other hand, rejects the possibility of establishing gas price caps, as proposed by the Italian government. “The Igu supports the principles of trade, including transparency, competitiveness and the removal of obstacles to progress in global gas markets. Price caps would probably not be consistent with these principles.” And from the perspective of the energy transition, gas, which provides a quarter of the world’s energy, “continues to be a key component”. For Khanberg “it is important that the world remains steadfast on the path of the energy transition and does not lose momentum in the global effort to combat climate change. In this, gas will continue to play an important role”. In this sense, he concludes, “we have long supported the need to accelerate investments in hydrogen and renewable gas technologies”, which have “great potential to accompany the decarbonisation of the world’s energy supply”, but for this potential to be realized “investments and projects on the ground must be strengthened as a matter of urgency”.