Will Egypt’s Gas Crunch Make Europe Suffer?

EOA’s Main Takeaways

The decline in Egypt’s LNG shipments to Europe, and the possibility of a complete halt forces Europe to look for other sources of LNG. This leads to two problems that threaten energy security: Concentration of supplies on one hand and the loss of a source that is nearby. The situation might get worse if the EU decides to sanction Russian LNG imports. But as we stated in previous reports, we do not expect the EU to sanction Russian LNG simply because there are no alternatives.  However, as energy balances worsen, Egypt will compete with Europe for LNG supplies!

After gaining momentum as one of Europe’s gas suppliers to compensate for the lost Russian gas in the European market, Egypt is scheduled to import multiple LNG cargoes this summer. These imports will help to mitigate expected power shortages during peak demand season. The imports will also reverse Egypt’s emerging role as a reliable LNG supplier to Europe.